Study: flaw disclosure hurts software makers' stock

Tuesday, 7 June 2005, 1:08 PM EST

Software makers stand to lose significant market value whenever a flaw is found in their products, two university researcher said in a paper published last week.

The study analyzed the release of 146 vulnerabilities and found that a software company's stock price decreases 0.63 percent compared to the tech-heavy NASDAQ on the day a flaw in that company's product is announced. The study assumed that the stock of a company would have the same trend as the stock index, and that any departure from the index would be due to the disclosure.

By Robert Lemos at The Register.

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