JOURNAL OF ACCOUNTING AND FINANCE
Short Selling, Informed Trading, and the Role of Social Media
Author(s): Leslie Boni, Shwadhin Sharma, Christina Zhang
Citation: Leslie Boni, Shwadhin Sharma, Christina Zhang, (2018) "Short Selling, Informed Trading, and the Role of Social Media", Journal of Accounting and Finance, Vol. 18, ss. 6, pp. 24-36
Article Type: Research paper
Publisher: North American Business Press
Abstract:
This paper investigates the relationship between short selling and Twitter activity prior to merger and
acquisition announcements. Data are for U.S.-listed banking firms from 2009 to 2013. In the week prior to the M&A announcement, we find abnormal daily short selling, particularly for cash deals. Twitter activity, rarely present in the week prior to the M&A announcement, spikes at the time the deal is announced. Social media tips do not appear to provide a channel for information transfer to short sellers prior to M&A announcements nor do sellers use social media to apply market pressure for stocks they have shorted.