When Shareholders Disagree: Trading after Shareholder Meetings

Sophia Zhengzi Li; Ernst Maug; Miriam Schwartz-Ziv

doi:10.1093/rfs/hhab059

When Shareholders Disagree: Trading after Shareholder Meetings

Sophia Zhengzi Li, Ernst Maug^*, Miriam Schwartz-Ziv

^*Corresponding author for this work

Business Administration

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11 Scopus citations

Abstract

This paper analyzes how trading after shareholder meetings changes the composition of the shareholder base. Analyzing daily trades, we find that mutual funds reduce their holdings if their votes are opposed to the voting outcome. Trading volume is high even when stock prices do not change, peaks on the meeting date, and remains high up to four weeks after shareholder meetings. The results support models based on differences of opinion that predict that shareholders' beliefs may diverge more after observing voting outcomes. Hence, trading after meetings creates a more homogeneous shareholder base, which has important implications for corporate governance.

Original language	English
Pages (from-to)	1813-1867
Number of pages	55
Journal	Review of Financial Studies
Volume	35
Issue number	4
DOIs	https://doi.org/10.1093/rfs/hhab059
State	Published - 1 Apr 2022

Bibliographical note

Publisher Copyright:
© 2021 The Author(s) 2021. Published by Oxford University Press on behalf of The Society for Financial Studies. All rights reserved. For permissions, please e-mail: [email protected].

Keywords

G11
G12
G14
G30
G40

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When Shareholders Disagree: Trading after Shareholder Meetings

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