DOI
10.3390/jrfm19040294
Author ORCID Identifier
Abdullah Kumas: https://orcid.org/0000-0001-7108-262X
Abstract
This study examines how institutional investors allocate trading across the earnings an- nouncement cycle and whether industry trading concentration strengthens that activity. The analysis is motivated by two complementary ideas: public disclosures can increase the value of investors’ prior information, and even sophisticated investors face costly information processing. These perspectives imply that institutional trading need not be concentrated only before disclosure and may be strongest after earnings announcements, when investors combine newly released public information with prior firm- and industry-specific signals. Using daily institutional trading data from Ancerno, we find that institutional net trading is positively related to earnings surprises before, during, and after earnings announcements, with the strongest relation occurring in the post-announcement period. We also document a clear asymmetry: trading is strongly related to positive earnings surprises across all three stages, whereas trading related to negative earnings surprises is concentrated mainly after disclosure. In addition, industry trading concentration strengthens the relation between institutional trading and earnings news across the announcement cycle, especially for positive surprises. These findings provide an integrated view of institutional information processing around a major recurring disclosure event, show that the timing of institutional trading is informative about how earnings news is incorporated into prices, and support the view that industry specialization is linked to stronger earnings-related trading.
Document Type
Article
Publication Date
2026
Publisher Statement
Journal of Risk and Financial Management is an international, peer-reviewed, open access journal on risk and financial management, published monthly online by MDPI (since Volume 6, Issue 1 - 2013).
- Open Access— free for readers, with article processing charges (APC) paid by authors or their institutions.
Recommended Citation
Sami, Keskek and Kumas Abdullah. . 2026. "Information Discovery, Interpretation, and Analysis by Institutional Investors Around Earnings Announcements," Journal of Risk and Financial Management 19 (4): 294. https://doi.org/10.3390/jrfm19040294.
