Skip Navigation



RFS Advance Access published online on October 28, 2005
Review of Financial Studies, doi:10.1093/rfs/hhj004
This Article
Right arrow Advance Access manuscript (PDF)
Right arrow All Versions of this Article:
19/1/119    most recent
hhj004v1
Right arrow Alert me when this article is cited
Right arrow Alert me if a correction is posted
Services
Right arrow Email this article to a friend
Right arrow Similar articles in this journal
Right arrow Alert me to new issues of the journal
Right arrow Add to My Personal Archive
Right arrow Download to citation manager
Right arrowRequest Permissions
Google Scholar
Right arrow Articles by Odders-White, E. R.
Right arrow Articles by Ready, M. J.
Right arrow Search for Related Content
Social Bookmarking
Add to CiteULike   Add to Connotea   Add to Del.icio.us  
What's this?

© The Author 2005. Published by Oxford University Press on behalf of the by The Society for Financial Studies. All rights reserved. For permissions, please email: journals.permissions@oxfordjournals.org.

Article

Credit Ratings and Stock Liquidity

Elizabeth R. Odders-White 1* and Mark J. Ready 2
1 Assistant Professor, School of Business, University of Wisconsin - Madison
2 Aschenbrener Faculty Scholar, School of Business, University of Wisconsin - Madison

* To whom correspondence should be addressed.
Elizabeth R. Odders-White, E-mail: ewhite{at}bus.wisc.edu


  Abstract

We analyze contemporaneous and predictive relations between credit ratings and measures of equity market liquidity, and find that common measures of adverse selection, which reflect a portion of the uncertainty about future firm value, are larger when credit ratings are poorer. We also show that future rating changes can be predicted using current levels of adverse selection. Collectively, our results validate widely used microstructure measures of adverse selection, and offer new insights into the value of credit ratings and the specific nature of the information they contain.


Add to CiteULike CiteULike   Add to Connotea Connotea   Add to Del.icio.us Del.icio.us    What's this?


This article has been cited by other articles:


Home page
 REV FINANC STUDHome page
T. Foucault, S. Moinas, and E. Theissen
Does Anonymity Matter in Electronic Limit Order Markets?
Rev. Financ. Stud., September 1, 2007; 20(5): 1707 - 1747.
[Abstract] [Full Text] [PDF]

Home page
 REV FINANC STUDHome page
V. Dimitrov and S. Tice
Corporate Diversification and Credit Constraints: Real Effects across the Business Cycle
Rev. Financ. Stud., December 1, 2006; 19(4): 1465 - 1498.
[Abstract] [Full Text] [PDF]


Disclaimer:
Please note that abstracts for content published before 1996 were created through digital scanning and may therefore not exactly replicate the text of the original print issues. All efforts have been made to ensure accuracy, but the Publisher will not be held responsible for any remaining inaccuracies. If you require any further clarification, please contact our Customer Services Department.