Rationality of Analysts' Earnings Forecasts: UK Evidence

Analysts play crucial role in capital market. However, numerous prior researches provide evidence that analysts' earning forecasts are not efficient with respect to new information. Basu and Markov (2004) re-examine the efficiency of analysts' earning forecasts using both quadratic loss fu...

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Main Author: Pan, Yixuan
Format: Dissertation (University of Nottingham only)
Language:English
Published: 2008
Subjects:
Online Access:https://eprints.nottingham.ac.uk/22108/
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author Pan, Yixuan
author_facet Pan, Yixuan
author_sort Pan, Yixuan
building Nottingham Research Data Repository
collection Online Access
description Analysts play crucial role in capital market. However, numerous prior researches provide evidence that analysts' earning forecasts are not efficient with respect to new information. Basu and Markov (2004) re-examine the efficiency of analysts' earning forecasts using both quadratic loss function and linear loss function. They argue that the forecasts are economically efficient under linear loss function. This dissertation replicates Basu and Markov (2004) method to examine the analysts'earnings forecast efficiency in UK market. The similar findings as Basu and Markov (2004) are obtained in my UK samples. The estimators of linear loss function is much closer to their predicted values than the estimators of quadratic loss function, and none of them are economically significant, indicating the analysts' earnings forecasts in UK market are economically efficient under linear loss function.
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institution University of Nottingham Malaysia Campus
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language English
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spelling nottingham-221082018-02-16T11:51:46Z https://eprints.nottingham.ac.uk/22108/ Rationality of Analysts' Earnings Forecasts: UK Evidence Pan, Yixuan Analysts play crucial role in capital market. However, numerous prior researches provide evidence that analysts' earning forecasts are not efficient with respect to new information. Basu and Markov (2004) re-examine the efficiency of analysts' earning forecasts using both quadratic loss function and linear loss function. They argue that the forecasts are economically efficient under linear loss function. This dissertation replicates Basu and Markov (2004) method to examine the analysts'earnings forecast efficiency in UK market. The similar findings as Basu and Markov (2004) are obtained in my UK samples. The estimators of linear loss function is much closer to their predicted values than the estimators of quadratic loss function, and none of them are economically significant, indicating the analysts' earnings forecasts in UK market are economically efficient under linear loss function. 2008 Dissertation (University of Nottingham only) NonPeerReviewed application/pdf en https://eprints.nottingham.ac.uk/22108/1/08MA_Finance_%26_Investment_lixyp2.pdf Pan, Yixuan (2008) Rationality of Analysts' Earnings Forecasts: UK Evidence. [Dissertation (University of Nottingham only)] (Unpublished) Earnings forecasts
spellingShingle Earnings forecasts
Pan, Yixuan
Rationality of Analysts' Earnings Forecasts: UK Evidence
title Rationality of Analysts' Earnings Forecasts: UK Evidence
title_full Rationality of Analysts' Earnings Forecasts: UK Evidence
title_fullStr Rationality of Analysts' Earnings Forecasts: UK Evidence
title_full_unstemmed Rationality of Analysts' Earnings Forecasts: UK Evidence
title_short Rationality of Analysts' Earnings Forecasts: UK Evidence
title_sort rationality of analysts' earnings forecasts: uk evidence
topic Earnings forecasts
url https://eprints.nottingham.ac.uk/22108/