The Impact of a Likeable and Pronounceable Stock Ticker Symbol (Brand) on Firm Value and Liquidity Rate

Document Type : Research Paper

Authors

1 دانشیار گروه مدیریت دانشگاه الزهرا

2 full Professor in accounting department of tarbiat modares

3 phd candidate in accounting

Abstract

The notion that stock ticker symbols matter for firm value might appear at odds with conventional wisdom, which suggests that firm value depends only on fundamentals. However, fundamental valuation of firms is widely known to require judgment about open-ended issues, where feedback is noisy and often deferred. This uncertainty, coupled with complex information, information asymmetry, intangible assets and … result in using heuristics in value assessments. The main objective of this study is to analyze the impact of likeableand pronounceable stock ticker symbol on firm value and liquidity of Tehran listed companies. In pursuance of this objective, data of 102 Tehran listed companies in year 2017 and comparative information for 2014 were used. In order to gauge this correlation, white heteroscedasticity-consistent standard errors least squares was applied. Using a comprehensivedataset with hand-collected ratings of ticker symbols, wefind that higher pronounceability of ticker symbols leads to higher Tobin'sQ. Further findings show that the impact of ticker symbols on stock liquidity rate is also positive.

Keywords

References

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