Lei Zhang, Assistant Professor of Finance, Nanyang Technological University: Level Playing Field or Obfuscation: The Informational Role of Overconfident CEOs
Topic: Level Playing Field or Obfuscation: The Informational Role of Overconfident CEOs
Speaker: Lei Zhang, Assistant Professor of Finance, Nanyang Business School, Nanyang Technological University
Date: April 11th (Tuesday)
Location: Building 4, Room 102
We study the informational role of overconfident CEOs. We find that the stocks of overconfident CEOs have lower analyst forecast dispersion, higher breadth of investor ownership, and lower informed trading intensity. These patterns also arise around CEO turnover. We also show that overconfident CEOs level the playing field between short sellers and other investors, as the (good) news in short interest (Boehmer, Huszár, and Jordan, 2010) exists only among stocks with non-overconfident CEOs and disappears among stocks with overconfident CEOs. Our results suggest that overconfident CEOs help increase information efficiency and lower the mispricing of their company shares.
About the speaker:
Lei Zhang is currently an assistant professor of finance in the School of Business since 2009. He received his Bachelor degree in Mathematics from Fudan University, Master and Ph.D. degrees from INSEAD respectively. His research interests include mergers and acquisitions, capital structure, risk management and financial intermediaries. He has published papers in academic journals including Journal of Financial Economics, Journal of Monetary Economics, Review of Asset Pricing Studies, Management Science, Review of Finance and Mathematical Finance.