Research On The Accuracy Of Ratings Of Securities Analysts And Its Influencing Factors

Securities analysts play a special role in the stock market.They obtained company information through telephone interviews,company research,etc.,tracking and forecasting the company's future stock price and releasing research report ratings.The listing conditions of the small and medium-sized board market are relatively loose.The majority of investors are in a weak position in information and lack investmentrelated knowledge.The analyst's research report is often used as an important reference for investment.However,is the analyst's research report accurate? Is there a difference in the accuracy of different categories of analyst reports? What other factors will affect the accuracy of the research report? This paper takes the analyst research report of China's small and medium-sized listed companies as an example to explore the above issues.This paper first reviews the literature and related theoretical basis for the accuracy of analyst ratings,using event research and multiple regression analysis.Using the research report of all small and medium-sized listed companies in the Eastern Fortune Choice database from April 2017 to October 2018 as a sample,study the accuracy of different rating research reports,whether investors can obtain excess returns according to analysts' reports,and the same Issues such as the accuracy of different categories of research reports under rating.On this basis,the factors such as the size of the company,the institutional attention of the company's stock,the nature of the company's controller,and the star analyst are used to further analyze the factors affecting the accuracy of the research report.The research in this paper finds that there is an “optimistic tendency” in the small and medium board analysts' research report,and the proportion of buy and overweight rating reports is too high.The short-term buy rating and overweight rating report are highly accurate and have low interim accuracy;while the neutral rating is more accurate in the medium term.The accuracy of the buy rating depth report is higher than that of the non-depth report;the buy rating of the well-known brokerage report is higher than the non-known brokerage,and the overweight rating of the well-known brokerage report is less accurate than the non-known brokerage.Before the securities analysts released positive ratings,the stocks had a very significant rate of extraordinary returns,indicating that the analysts did get some private information about the company through research,but the information was highly probable before the report was released.For the factors affecting the accuracy of the research report rating,the empirical results show that in the small and medium-sized board market,for the positive rating,the higher the organization's attention or the more famous the analyst,the higher the accuracy of the report.The size of the company and the nature of the company's controlling shareholder have little impact on the accuracy of the report.Finally,the paper makes recommendations for regulators and investors separately.Regulators should improve the information disclosure system,reduce information asymmetry in the market,and strengthen investor education.Investors should treat analysts' research reports with caution and reduce irrational investments.