Text & Filings#391tier 2experimental liveNew

`item 1 02 termination material agreement short`

cadence: Eventdata: lowshort only

1990

McConnell, J. J., Servaes, H. (1990). "Additional Evidence on Equity Ownership and Corporate Value." Journal of Financial Economics 27(2), 595-612.

Read the paper →

What it checks

When a company terminates a material contract (Item 1.02), it signals lost revenue or a broken strategic relationship. Short for 1-3 months.

Mechanism

8-K Item 1.02 (Termination of a Material Definitive Agreement) flags the loss of a material supply, distribution, license, or partnership contract. McConnell-Servaes 1990 and the broader event-study literature show negative drift on growth-option destruction.

No production champion data for this family yet. Stats appear once the discovery pipeline promotes at least one strategy with this family tag, or once a multi-family blend that includes it earns a champion slot.

Signal rule

Any 8-K Item 1.02 filing on T+1 fires SHORT, hold 30/60/90d.

Data dependencies

daily_prices
Adjusted-close OHLCV for every US-listed ticker; primary price feed.
sec_8k_events
Item-coded 8-K events (1.01 material agreements, 4.02 non-reliance, etc.).

Expected edge

Paper alpha: -3 to -5% over 30-90d
Paper window: T+1 to T+90d

McConnell-Servaes 1990; -3 to -5% over 30-90d on contract termination.

Related families

item 2 03 debt obligation shortText & Filings

8-K Item 2.03 (Creation of a Direct Financial Obligation) discloses new debt issuance. Spiess-Affleck-Graves 1999 document negative long-run drift after debt offerings (consistent with capital-structure timing where managers issue debt when overvalued or facing constraints). Short the post-filing window for 60-180 days.

item 3 02 unregistered equity shortText & Filings

8-K Item 3.02 (Unregistered Sales of Equity Securities) reveals a PIPE or unregistered share issuance, typically at a discount. Hertzel-Smith 1993 documents negative long-run drift after PIPEs (signaling weak balance-sheet conditions and dilution). Short the post-filing window for 60-180 days.

item 2 05 restructuring shortText & Filings

8-K Item 2.05 (Costs Associated with Exit or Disposal Activities) flags material restructurings, plant closures, asset write-downs, and discontinued operations. The market under-reacts at filing; the underlying operating weakness leaks out over ~60d as the restructuring takes effect.

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item 1 02 termination material agreement short