Study on the relationship between Word Preference and Stock Returns under the background of intelligent information

摘要

Based on intelligent informatics, this study examines whether corporate names with implications of luck and taboo have different effects on firm value using a sample of Chinese IPO firms. With the help of the green service system, it can provides investment decisions for the consumers. We find that after controlling for other influencing factors, P/E ratios are positively associated with lucky names but have a slightly negative relationship with taboo names. Similarly, CARs are positively correlated to lucky names but negatively with taboo names. The results also indicate that China’s IPO firms with taboo names have higher first-day returns, but drop faster than do other firms, indicating that these firms experience lower pricing when getting listed. Our findings highlight the economically meaningful role of firms’ names in the process of going public.