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This research aims to examine the effects of SEC mandated segment data on price variability and the divergence of beliefs among financial analysts.

The impact of SEC mandated segment data on price variability and divergence of beliefs.

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Empirical analysis shows SEC mandated segment data increases price variability and lowers analysts' belief divergence.

This research aims to examine the effects of SEC mandated segment data on price variability and the divergence of beliefs among financial analysts.
Analyzed 10-K reports from 1969 and 1970 to compare price variability
Measured divergence of beliefs using earnings forecasts from financial analysts
Divided sample into control and experimental groups based on segment disclosures
Applied the Patell methodology for assessing price variability
Investigated correlations between number of segments and price variability/divergence results.
Experimental group showed significant increase in price variability after SEC disclosure
Divergence of beliefs decreased significantly for the experimental group post-disclosure
No significant effects observed in the control group
Magnitude of changes in price variability and belief divergence correlated with the number of segments.

Siva Swaniinothan (1991) studied this question.

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