<abstract xmlns="http://www.w3.org/1999/xhtml"><p>This paper examines the impact of financial literacy on stock price informativeness in a sample of firms from 20 countries. Using four measures of stock price informativeness, we find a significant relationship between higher financial literacy and higher stock price informativeness. The individual investors’ contribution regarding the incorporation of specific information into stock prices includes private information also and not mere specific information in the general sense. Financial knowledge is the key element that helps individual investors to incorporate specific information into stock prices.</p></abstract>

This paper examines the impact of financial literacy on stock price informativeness in a sample of firms from 20 countries. Using four measures of stock price informativeness, we find a significant relationship between higher financial literacy and higher stock price informativeness. The individual investors’ contribution regarding the incorporation of specific information into stock prices includes private information also and not mere specific information in the general sense. Financial knowledge is the key element that helps individual investors to incorporate specific information into stock prices.

Financial Literacy and Stock Price Informativeness: a Cross-Country Study

Studia Universitatis Babes-Bolyai Oeconomica

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

{"article-title":"Financial Literacy and Stock Price Informativeness: a Cross-Country Study"}

This paper examines the impact of financial literacy on stock price informativeness in a sample of firms from 20 countries. Using four measures of stock price...

Financial Literacy and Stock Price Informativeness: a Cross-Country Study

Published Online: May 26, 2018

Page range: 63 - 72

DOI: https://doi.org/10.2478/subboec-2018-0004

Keywords
price informativeness, financial literacy, financial knowledge, firm-specific information, private information

© 2018 Anita Todea, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Financial Literacy and Stock Price Informativeness: a Cross-Country Study

Published Online: May 26, 2018

Page range: 63 - 72

DOI: https://doi.org/10.2478/subboec-2018-0004

Keywordsprice informativeness, financial literacy, financial knowledge, firm-specific information, private information

© 2018 Anita Todea, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Keywords
price informativeness, financial literacy, financial knowledge, firm-specific information, private information