Document Type
Article
Publication Date
2023
Journal Title
The Journal of Financial Research
Volume Number
46
Issue Number
3
First Page
631
Last Page
679
DOI
doi.org/10.1111/jfir.12327
Version
Publisher PDF: the final published version of the article, with professional formatting and typesetting
Disciplines
Business
Abstract
The Shenzhen Stock Exchange (SZSE) in China is unique worldwide in requiring disclosure of the timing, participants, and selected content of private in‐house meetings between firm managers and outsider investors. We investigate whether these private meetings benefit hosting firms and their major outside institutional investors— blockholder mutual funds (i.e., funds with ownership ≥5%). Using a large data set of SZSE firms, we find that blockholder mutual funds have more access to private in‐ house meetings, and top management is more likely to be present, especially when a meeting is associated with negative news. Furthermore, when blockholder mutual funds attend negative‐news meetings with top management, they are less likely to sell shares, their investment relationship with the hosting firm lasts longer, and hosting firms experience lower postmeeting stock return volatility. These findings suggest that private in‐house meetings are an informative disclosure channel that improves social bonding between top management and blockholder mutual funds in ways that benefit hosting firms.
Digital USD Citation
Bowen, Robert M.; Dutta, Shantanu; Tang, Songlian; and Zhu, Pengcheng, "Blockholder Mutual Fund Participation in Private In‐House Meetings" (2023). School of Business: Faculty Scholarship. 34.
https://digital.sandiego.edu/busnfaculty/34