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Article
Short Selling, Informed Trading, and the Role of Social Media
Journal of Accounting and Finance (2018)
  • Leslie Boni, California State University, Monterey Bay
  • Shwadhin Sharma, California State University, Monterey Bay
  • Christina Zhang, California State University, Monterey Bay
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.
Keywords
  • Accounting,
  • Finance,
  • Stocks,
  • Market
Disciplines
Publication Date
September 30, 2018
DOI
10.33423/jaf.v18i6.446
Citation Information
Leslie Boni, Shwadhin Sharma and Christina Zhang. "Short Selling, Informed Trading, and the Role of Social Media" Journal of Accounting and Finance Vol. 18 Iss. 6 (2018) p. 24 - 36
Available at: http://works.bepress.com/leslie-boni/2/