This paper examines how environmental and social (ES) performance, proxied by related incidents, affect the managerial and analyst tones in quarterly earnings conference calls and its incremental effect on post-earnings call returns. We document that firms experiencing poor ES performance in the quarter prior to the earnings call exhibit more negative management tone after controlling for quarterly financial performance metrics. Tone difference in conference calls between managers and analysts predicts negative abnormal returns in the three-day window around the call. In the 60-day post-call period, we show that firms with poor ES performance exhibit returns negatively related to the tone difference on the conference call – low tone difference leads to return continuation and high tone difference predicts reversals for firms with positive earnings surprises. These results are consistent with an increase in information asymmetry and lower transparency for firms following poor ES performance.

How are trading activity and performance impacted by material events during individual investors’ lifetimes? Using a unique dataset, we identify transfers of common stock initiated by the major event of divorce and analyze trading patterns and performance of divorced traders. In aggregate, divorcing individuals underperform, and part of this underperformance is due to liquidation needs arising from divorce. Cross-sectionally, however, actively-trading divorced investors demonstrate superior performance in the window surrounding divorce settlement, while underperforming just prior to divorce. This result survives a difference-in-differences analysis based on a propensity-score matched sample of non-divorced investors. Our analysis thus suggests that the life-cycle distraction of divorce temporarily reduces the performance of active retail traders, which improves once the stressor is removed.

This study examines whether trading patterns at the 52-week high reflect investor disagreement or behavioral convergence. Using StockTwits sentiment, TAQ microstructure data, and machine-learning-informed trading measures for S&P 500 stocks, we document that investor beliefs converge rather than diverge, thereby reducing disagreement by approximately 20%. Belief dispersion falls while both retail and institutional investors proportionally reduce trading and shift toward selling. Anchoring to the 52-week high generates a liquidity mirage, concentrated among the largest stocks where competitive market making prevails: effective spreads narrow and depth increases even as informed-trading intensity declines, consistent with adverse selection models but driven by behavioral convergence. Although liquidity appears to improve, price discovery weakens, and the stock subsequently underperforms characteristic and factor benchmarks by 20 to 30 basis points over five days. Our findings demonstrate how improvements in liquidity can coincide with weaker price discovery when investor beliefs converge around salient behavioral anchors.