Company Name Fluency and Stock Returns

28 Pages Posted: 22 Feb 2018 Last revised: 3 Nov 2020

See all articles by Maurizio Montone

Maurizio Montone

Utrecht University

Martijn J. van den Assem

Vrije Universiteit Amsterdam

Remco C. J. Zwinkels

Vrije Universiteit Amsterdam; Tinbergen Institute

Date Written: November 2, 2020


Research shows that stocks with fluent names trade at higher prices. However, it is not clear whether fluency simply appeals to naive investors, or actually identifies better firms. In this paper, we disentangle these two explanations. Consistent with our theoretical model, we find that the effects of fluency are concentrated among firms with a below-median market capitalization and an above-median sentiment beta. Companies with fluent names are more profitable, but this information appears to be only partially reflected in stock prices due to the presence of unsophisticated investors. Correspondingly, stocks with fluent names yield higher abnormal returns relative to stocks with nonfluent names.

Keywords: Fluency; Investor Recognition; Asymmetric Information; Stock Returns

JEL Classification: G12, G14, G41

Suggested Citation

Montone, Maurizio and van den Assem, Martijn J. and Zwinkels, Remco C.J., Company Name Fluency and Stock Returns (November 2, 2020). Available at SSRN: or

Maurizio Montone

Utrecht University ( email )

Kriekenpitplein 21-22
Adam Smith Building
Utrecht, +31 30 253 7373 3584 EC

Martijn J. Van den Assem (Contact Author)

Vrije Universiteit Amsterdam ( email )

De Boelelaan 1105
Amsterdam, 1081HV

Remco C.J. Zwinkels

Vrije Universiteit Amsterdam ( email )

De Boelelaan 1105
Amsterdam, NL-1081HV
+31 20 59 85220 (Phone)


Tinbergen Institute ( email )

Gustav Mahlerplein 117
Amsterdam, 1082 MS

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
PlumX Metrics