@article {Tavor93, author = {Tchai Tavor}, title = {Target Price Rumor and Its Effect on Market Efficiency}, volume = {22}, number = {4}, pages = {93--102}, year = {2013}, doi = {10.3905/joi.2013.22.4.093}, publisher = {Institutional Investor Journals Umbrella}, abstract = {The past decade has seen remarkable worldwide development in telecommunications and information technology. This process has occurred in the financial markets as well during the same period, manifesting as a significantly increased number of rumors reaching the Internet, which undoubtedly affected investors.This study focuses on a distinct, specific event{\textemdash}namely, target price rumors (TPR){\textemdash}and examining investors{\textquoteright} responses to such rumors. This study consists of two main tests. The first test involves a general observation of investors{\textquoteright} behavior in relation to TPR. The second test observes whether or not market behavior may be predicted for the post-publicity period, based on companies{\textquoteright} performance prior to that period. The first test{\textquoteright}s results suggest that the rumor was mostly effective for a five-day period, beginning three days prior to publicity and ending the day thereafter. The second test{\textquoteright}s results indicate an inverse trend between companies{\textquoteright} performance prior to publication and thereafter.TOPICS: Security analysis and valuation, portfolio theory}, issn = {1068-0896}, URL = {https://joi.pm-research.com/content/22/4/93}, eprint = {https://joi.pm-research.com/content/22/4/93.full.pdf}, journal = {The Journal of Investing} }