Strategic News Releases in Equity Vesting Months

Alex Edmans, Luis Goncalves-Pinto, Yanbo Wang, Moqi Xu

NBER Working Paper No. 20476
Issued in September 2014
NBER Program(s):   CF

We show that CEOs strategically time corporate news releases to coincide with months in which their equity vests. These vesting months are determined by equity grants made several years prior, and thus unlikely driven by the current information environment. CEOs reallocate news into vesting months, and away from prior and subsequent months. They release 5% more discretionary news in vesting months than prior months, but there is no difference for non-discretionary news. These news releases lead to favourable media coverage, suggesting they are positive in tone. They also generate a temporary run-up in stock prices and market liquidity, potentially resulting from increased investor attention or reduced information asymmetry. The CEO takes advantage of these effects by cashing out shortly after the news releases.

You may purchase this paper on-line in .pdf format from ($5) for electronic delivery.

Access to NBER Papers

You are eligible for a free download if you are a subscriber, a corporate associate of the NBER, a journalist, an employee of the U.S. federal government with a ".GOV" domain name, or a resident of nearly any developing country or transition economy.

If you usually get free papers at work/university but do not at home, you can either connect to your work VPN or proxy (if any) or elect to have a link to the paper emailed to your work email address below. The email address must be connected to a subscribing college, university, or other subscribing institution. Gmail and other free email addresses will not have access.


A non-technical summary of this paper is available in the January 2015 NBER digest.  You can sign up to receive the NBER Digest by email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w20476

Users who downloaded this paper also downloaded* these:
Krueger, Kahneman, Schkade, Schwarz, and Stone National Time Accounting: The Currency of Life
Davis and Haltiwanger w20479 Labor Market Fluidity and Economic Performance
Bernheim and Garrett w5667 The Determinants and Consequences of Financial Education in the Workplace: Evidence from a Survey of Households
Edmans, Fang, and Lewellen w19407 Equity Vesting and Managerial Myopia
Haninger, Ma, and Timmins w20296 The Value of Brownfield Remediation
NBER Videos

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us