Key Findings: 2023 Wall Street Horizon Annual Event-Driven Data Survey

Published: July 6, 2023

Wall Street Horizon conducted an online survey focused on the impact of event-driven data. Conducted in April 2023, the majority of respondents were researchers, technologists and portfolio managers. The firms they represented were mostly institutional quantitative fund managers.  

Key findings include:

• Earnings announcements and M&A ranked as the top two corporate event types that are most important to follow.

• Approximately half of respondents experienced a loss due to an earnings date that was missing, incorrect or had changed.

• Out of the 47% that suffered a loss, 44% affected a trading strategy and 22% reported that they missed a trade

• Macroeconomic risk was the primary risk concern (41%) followed by geopolitical risk (35%) and data & misinformation risk (17%).

Earnings Announcements Still a Fan Favorite

Earnings announcement data led the charge historically and this year is no exception. As Figure 1 shows, the top 5 event types impacting stock price include: earnings announcement, M&A, dividend, earnings date change, and investor related conference. The survey allowed participants to rank in order of importance, therefore, Figure 1 reflects a weighted average.

Figure 1

Source: Wall Street Horizon

Similar to last year’s survey, investors are becoming more savvy by recognizing that earnings announcement dates and their changes can serve as volatility catalysts. 

In fact, the Wall Street Horizon Late Earnings Report Index (LERI) that tracks outlier earnings date changes among publicly traded companies closed the first quarter earnings season (reported in Q2 2023) with a LERI of 106. This suggested that companies were more worried than they have been in three quarters. Learn more about the uncertainty index 

No One Likes to Lose

In 2023, 47% of firms experienced a loss because an earnings date was missing, incorrect or had changed. Figure 2 shows the results over the past five years: 50% in 2022, 26% in 2021, 45% in 2019, 35% in 2018 and 45% in 2017.

Figure 2

Source: Wall Street Horizon

At Wall Street Horizon we recognize  ‘Corporate Body Language’ ─ such as a shift in an earnings date ─ includes signals public company executives relay to the market in their actions. For example, if a company delays an earnings date, according to independent academic research this typically indicates bad news is forthcoming.

Figure 3

Source: Wall Street Horizon

What was the result from a bad earnings date? Unfortunately, 44% said it affected a trading strategy and 22% reported that they missed a trade.

Top Risk Worries

Risk is top of mind now more than ever given the banking crisis, inflation rates and global unrest for starters. Survey participants flagged macroeconomic risk as the primary risk concern (41%) followed by geopolitical risk (35%) and data & misinformation risk (17%) in Figure 4. 

Figure 4

Source: Wall Street Horizon

In addition, Figure 5 shows we launched a similar poll during our Data Minds virtual panel “Chaos to Clarity: Leveraging Data in a Volatile Market” on May 4, 2023. Given the timing of the bank collapse, it makes sense that the economic impact of the recession (20%) and banking crisis (17%) were ranked up there for top worries along with geopolitical risk (20%).

Figure 5

Source: Wall Street Horizon

For more information on using event data for risk management, take a peek at The Importance of Timely and Accurate Corporate Event Data: Investment and Risk Strategy Use Cases