Corporate Information Disclosure by firms in twitter will have impact on its stock price

1. Twitter is extensively being used by Fortune 500 companies

1.1. Twitter provides companies instantaneous access and interaction with stakeholders

2. SEC allows companies to use social media to disseminate material, nonpublic information to investors consistent with Regulation FD , alternative to Form-8K

2.1. SEC allows any social media platform for disclosure, then why consider only Twitter communication?

2.1.1. More companies among fortune 500 have active Twitter account than other Social Network site

2.1.2. Research says, users respond more quickly to disclosures released on Twitter than on Facebook

3. Tweets of companies have price sensitive and material information

3.1. How to segregate price sensitive and material information from all tweets?

3.1.1. Identifying what is price sensitive information can be done only in hindsight.

3.1.1.1. 32% more tweeting activities around 8-K dates, corporate disclosure dates

3.1.2. Elevated levels of Twitter activity will indicate importance and market relevance disclosures

3.1.2.1. Security exchange (SE) 1994 report makes it clear that it is not feasible to define any theoretical percentage movement in a share price which makes the communication information price sensitive.

4. Corporate Twitter communication will update investor expectation about the company

4.1. Change in Investor expectation will result in trade action

4.1.1. Collective trade action will change the price

4.2. Are all investors of the company following the twitter handle?

4.2.1. All DJIA index company have followers in millions and because company use social media actively to disseminate information, active investors will follow to get authentic information