Exogenous and endogenous attention and the convergence of analysts’ forecasts

Robert B. Durand, Manapon Limkriangkrai, Lucia Fung

Research output: Contribution to journalArticleResearchpeer-review

Abstract

The propensity of the forecasts of sell-side financial analysts to converge (or diverge) is a function of their exogenous and endogenous selective attention and overconfidence. When returns are negative, the endogenous form of selective attention—a static measure of analysts’ goal-driven attention at a particular point in time—has a positive association with convergence. The exogenous form of selective attention—a relatively involuntary dynamic process of exogenous attentional shift driven by external changes in the market over time—is associated with a tendency for forecasts to diverge.

Original languageEnglish
Pages (from-to)154-172
Number of pages19
JournalJournal of Behavioral Finance
Volume20
Issue number2
DOIs
Publication statusPublished - 3 Apr 2019

Keywords

  • Behavioral finance
  • Converging/diverging forecasts
  • Distraction
  • Endogenous and exogenous selective attention
  • Overconfidence
  • Sell-side analysts

Cite this

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Exogenous and endogenous attention and the convergence of analysts’ forecasts. / Durand, Robert B.; Limkriangkrai, Manapon; Fung, Lucia.

In: Journal of Behavioral Finance, Vol. 20, No. 2, 03.04.2019, p. 154-172.

Research output: Contribution to journalArticleResearchpeer-review

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