Investor Climate Sentiment and Financial Markets
- Authors
- Publication Date
- Mar 01, 2023
- Source
- ORBi
- Keywords
- Language
- English
- License
- Green
- External links
Abstract
peer reviewed / We propose to measure investor climate sentiment by performing sentiment analysis on StockTwits posts on climate change and global warming. In financial markets, stocks of emission (carbon-intensive) firms underperform clean (low-emission) stocks when investor climate sentiment is more positive. We document investors overreaction to climate change risk and reversal in longer horizons. Salient but uninformative climate change events (i.e., release of a report on climate change, abnormal weather events, and high carbon prices) facilitate the investor learning process and correction of the mispricing.
