Hello everyone. I have a research question about analysts. I want to examine the effect on analysts forecasts at the level of individual analysts, and I think there is need to control analyst experience and analyst fixed effects. However, an analyst report is often made by more than one analyst. I feel concerned about how to deal with the research reports made by several analysts.
For example, if I want to explore the analyst i's most recent forecast on firm j in year t and the most recent forecast is made by 3 analysts together, should these 3 analysts be considered together as analyst i? Or should they be separated?
This is an exploratory research. Your research question, hypothesis to be tested, scope of the study and the available data will determine your results. Your discussion should be detailed enough for the audience's understanding of the effect (positive or negative)of individual analyst on the firm j in line with past researchers. Whilst the summary may reflect the combined effect of the 3 identified analysts on the firm.
When conducting research on the effect of analysts' forecasts at the individual analyst level, it's essential to carefully consider how to handle reports made by multiple analysts for a single forecast. This situation often arises in the field of financial analysis, where research reports may involve contributions from several analysts within a firm
Combine the forecasts of multiple analysts into a single consensus forecast for the firm and year in question.
This approach treats all the analysts who contributed to the report as a collective entity, representing the firm's official forecast. This is often referred to as the "consensus forecast."
hi everybody
Think of a person named Jane, who works for a well-known financial firm. Jane specializes in analyzing technology companies and has a history of making accurate predictions about how these companies will perform. Her insights and recommendations have a big impact on how both regular people and big investment firms make decisions.
People pay close attention to what Jane says because they trust her knowledge in the tech sector. If Jane publishes a report saying that a particular tech company looks promising because of its innovative products, investors tend to buy more of that company's stock. This increased demand for the stock can drive up its price, which benefits the people who invested in it based on Jane's advice.
On the flip side, if Jane were to write a report that's negative about another tech company, maybe because she's worried about its finances or how it's competing with others, investors might start selling their shares of that company. When lots of people sell, the stock price can drop.
So, individual analysts like Jane can have a pretty big impact on the stock market. Their analyses and recommendations can affect stock prices, how much trading happens, and how people feel about the market in general. It's important for investors to consider how good an analyst's track record is when deciding whether to follow their advice
Hello All,
I think we should consider it together as analyst "i". i can be anything, it may be a individual, or a firm or a any institute or any company.
Many people follows a opinion of a single analyst for some time, but every time it is practically not possible to hit. It also depends on the perception of that one analyst as well. it more or less runs on perception only. If this is the case then its very adventurous to have a trust on single analyst every time. Consensus analysis is very important here. When two or more analyst comes together, they all think from a different perspective that would be more useful result for all for a investment purpose.
If we check there are very well known companies which are covered by many analyst at a time. we can get a data of that very easily. On the other side very small companies are covered by one or null analyst in the market. it has become very critical to take a call of investment on such a small cap companies.
at the conclusion i think that we should consider "i" as a group of analyst belongs to one investing company. we should consider it together as a call from that single one company.
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