Loss aversion and reversion to mean earnings missed patterns

Companies that exhibited pattern

Netflix

• Earnings date: July 16th 2018
• Pre-earnings price: USD416
• After hours base price: USD340
• Next day opening price: USD359
• Net gain: 5.58%

Facebook

• Earnings date: July 25th 2018
• Pre-earnings price: USD220
• After hours base price: USD168
• Next day opening price: USD178
• Net gain: 5.9%

Spotify

• Earnings date: May 3rd 2018
• Pre-earnings price: USD170
• After hours base price: USD154.25
• Next day opening price: USD158
• Net gain: 2.5%

 

External references

• Loss aversion and reversion to mean