NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Tailspotting: Identifying and profiting from CEO vacation trips

David Yermack

NBER Working Paper No. 17940
Issued in March 2012
NBER Program(s):   CF   LE

This paper shows close connections between CEOs' absences from headquarters and corporate news disclosures. I identify CEO absences by merging corporate jet flight histories with records of CEOs' property ownership near leisure destinations. I find that CEOs go to their vacation homes just after companies report favorable news, and CEOs return to headquarters right before subsequent news is released. When CEOs are away, companies announce less news than usual, mandatory disclosures are more likely to occur late, and stock prices exhibit sharply lower volatility. Volatility increases when CEOs return to work. CEOs spend fewer days out of the office when their ownership is high and when the weather is bad at their vacation homes.

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This paper was revised on December 2, 2013

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Document Object Identifier (DOI): 10.3386/w17940

Tailspotting: Identifying and profiting from CEO vacation trips,” Journal of Financial Economics (forthcoming).

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