%0 Journal Article %A Tchai Tavor %T Target Price Rumor and Its Effect on Market Efficiency %D 2013 %R 10.3905/joi.2013.22.4.093 %J The Journal of Investing %P 93-102 %V 22 %N 4 %X 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—namely, target price rumors (TPR)—and examining investors’ responses to such rumors. This study consists of two main tests. The first test involves a general observation of investors’ 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’ performance prior to that period. The first test’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’s results indicate an inverse trend between companies’ performance prior to publication and thereafter.TOPICS: Security analysis and valuation, portfolio theory %U https://joi.pm-research.com/content/iijinvest/22/4/93.full.pdf