| Article ID | Journal | Published Year | Pages | File Type |
|---|---|---|---|---|
| 5069281 | Finance Research Letters | 2017 | 6 Pages |
â¢This paper investigates the relationship between earnings announcements and BHC quoted bid-ask spreads.â¢The findings suggest that earnings announcements cause BHC quoted bid-ask spreads to widen.â¢I argue that this is due to earnings releases increasing information asymmetry between informed traders and market makers.
This paper investigates the relationship between earnings announcements and quoted bid-ask spreads of US Bank Holding Companies (BHCs). Using a large sample of daily BHC market data, I hypothesize and find evidence of a positive relation between earnings announcements and the quoted bid-ask spread. I argue that this result is due to earnings releases helping to increase information asymmetries between informed traders and market makers.
