Short financial reports help the share price

Short financial reports are more effective than long ones.

Long reports: bouncy shares

Companies reporting their financial results with long and wordy documents are more likely to have volatile share prices, reports The Times. Analysis can’t see the wood for the trees.The length of the financial report is the dominant factor in the movement of share prices after the publication of reports, say the researchers from Notre Dame University.

Legal protection
They examined 66,000 filings in the USA over 1994 and 2011. Companies put as much detail as they can in their reports to protect themselves legally. But the affect of a long report on the share price is instability.
So keep it short and clear to avoid unnecessary fluctuations in your share price.

Have a go at our Caption Competition and win a free e-learning course of your choice!

Leave a Reply

Your email address will not be published.