The "momentum effect" holds that stocks that performed well in the recent past will continue to do so in the near future. Yet this is far from a universal effect. Although momentum profits can be substantial in places such as the U.S., the effect is much weaker in other places, notably East Asia. New research suggests there may be cultural-related factors at ... Read More

A company's relations with its stakeholders can have an important bearing on its financial performance. And while this obviously holds true for shareholders, it is also the case for non-financial stakeholders such as employees, suppliers and the community. In fact, the state of relations with this group can also be a determining factor in affecting the ... Read More

Manufacturers who want to launch a new product or upgrade an old one would do well to consider the channels they use to disclose the product's quality to their consumers. Going down the wrong route may reduce profitability. That's the recommendation of Liang Guo of HKUST, who constructed a model to look at the format options for disclosing information about ... Read More

Do individual investors, or those with little information about a company's prospects, affect stock prices? Over the past decade, this question has been at the forefront of research and debate in financial economics. On one side are the traditional "Chicago School" economists who believe that those with no valuable information have little impact on stock ... Read More

Creativity can be a valuable quality in employees. It can lead them to generate new ideas and approaches, refine existing procedures, and find alternatives, thus boosting their - and their company's - performance. A new study provides evidence of this phenomenon and identifies factors that enhance employee creativity. Yaping Gong and Jiing-Lih Farh of HKUST ... Read More

Analysts should be independent sources of information for investors, but it does not always turn out this way. By the early 2000s, analysts were issuing more and more Buy recommendations, and less and less Sell recommendations not because stocks are necessarily fundamentally good but because their Buy recommendations help their employers to maintain existing ... Read More

Cultural distance can be a key factor in how firms enter a foreign market and the type of investment they make, as research has shown. But what about when firms in the host country seek foreign involvement in their projects at home? Does cultural distance affect their decisions, too? Jiatao Li of HKUST and co-authors Seung-Hyun Lee and Oded Shenkar consider ... Read More

Reducing information asymmetry between managers and the market can benefit firms, as many firms well know. Those seeking external financing or reporting greater earnings growth are more likely to disclose financial information, and disclosure has also been shown to have a positive impact on share price. It's also linked to better corporate governance and CEO ... Read More

A salesperson's attempts blatantly flatter customers in order to make a sale - for example, by fulsomely complimenting their dress sense or taste - can annoy the recipients. But it turns out the sweet words may still have a desirable effect. Customers, in the long term, harbour more positive views of the flatterer. That was the finding in a study by Elaine ... Read More

New technology has opened new windows for sellers to market their products. E-mail, fax, telemarketing and direct mail can reach thousands of consumers at a relatively low cost. However, consumers pay a price because their privacy is violated - and their response can have interesting implications for sellers and consumers. Consumers may engage in concealment ... Read More