%0 Unpublished work %T Stock Market Rumors and Credibility %+ Ecole des Hautes Etudes Commerciales (HEC Paris) %A Daniel, Schmidt %Z FIN-2019-1331 %8 2018-11-21 %D 2018 %K Rumors %K Cheap Talk %K Investment Horizons %K Information Efficiency %Z Humanities and Social Sciences/Business administrationPreprints, Working Papers, ... %X Stock prices occasionally move in response to unverified rumors. I propose a cheap talk model in which a rumormonger's incentives to tell the truth depend on the interaction between her investment horizon and the information acquisition decisions of message-receiving investors. The model's key prediction is that short investment horizons can facilitate credible information sharing between investors, thereby accelerating the information capitalization into market prices. Analyzing a dataset of takeover rumors covered by US newspapers, I find suggestive evidence in support of this prediction. %G English %Z HEC Research Paper Series %L hal-02896042 %U https://hec.hal.science/hal-02896042 %~ SHS %~ HEC