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Keeping up with the Joneses and the real effects of S&P 500 inclusion
Bennett, Benjamin; Stulz, René M.; Wang, Zexi - 2021
Firms added to the S&P 500 index join a prestigious and exclusive club. They want to fit in the club, which creates a “keeping up with the Joneses” effect. Firms pay more attention to their index peers after inclusion and their investment, external financing, and payouts comove more with...
Persistent link: https://www.econbiz.de/10012584272
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Why are corporate payouts so high in the 2000s?
Kahle, Kathleen M.; Stulz, René M. - 2020
The average annual inflation-adjusted amount paid out through dividends and repurchases by public industrial firms is more than three times larger from 2000 to 2019 than from 1971 to 1999. We find that an increase in aggregate corporate income accounts for 37% of the increase in aggregate annual...
Persistent link: https://www.econbiz.de/10012301433
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Managing stablecoins : optimal strategies, regulation, and transaction data as productive capital
Li, Ye; Mayer, Simon - 2020
Stablecoins rise to meet the demand for safe assets in decentralized finance. Stablecoin issuers transform risky reserve assets into tokens of stable values, deploying a variety of tactics. To address the questions on the viability of stablecoins, regulations, and the initiatives led by large...
Persistent link: https://www.econbiz.de/10012501237
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Does joining the S&P 500 index hurt firms?
Bennett, Benjamin; Stulz, René M.; Wang, Zexi - 2020
We investigate the impact on firms of joining the S&P 500 index from 1997 to 2017. We find that the positive announcement effect on the stock price of index inclusion has disappeared and the long-run impact of index inclusion has become negative. Inclusion worsens stock price informativeness and...
Persistent link: https://www.econbiz.de/10012263191
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Cash, financial flexibility, and product prices : evidence from a natural experiment in the airline industry
Kim, Sehoon - 2017
Corporate cash holdings impact firms' product pricing strategies. Exploiting the Aviation Investment and Reform Act of the 21st Century as a quasi-natural experiment to identify exogenous shocks to competition in the airline industry, I find that firms with more cash than their rivals respond to...
Persistent link: https://www.econbiz.de/10011963285
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What is the impact of successful cyberattacks on target firms?
Kamiya, Shinichi; Kang, Jun-koo; Kim, Jungmin; … - 2018
We develop a model where a firm has an optimal exposure to cyber risk. With rational, fully informed agents and with no hysteresis, a successful cyberattack should have no impact on a financially unconstrained target's reputation and post-attack policies. In contrast, when a successful attack...
Persistent link: https://www.econbiz.de/10011969119
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q-factors and investment CAPM
Zhang, Lu - 2019
The q-factor model shows strong explanatory power and largely summarizes the cross section of average stock returns. In particular, the q-factor model fully subsumes the Fama-French (2018) 6-factor model in head-to-head factor spanning tests. The q-factor model is an empirical implementation of...
Persistent link: https://www.econbiz.de/10012168924
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How valuable is financial flexibility when revenue stops? : evidence from the COVID-19 crisis
Fahlenbrach, Rüdiger; Rageth, Kevin; Stulz, René M. - 2020 - Revised May 17, 2020
Firms with greater financial flexibility should be better able to fund a revenue shortfall resulting from the COVID-19 shock and benefit less from policy responses. We find that firms with high financial flexibility within an industry experience a stock price drop lower by 26% or 9.7 percentage...
Persistent link: https://www.econbiz.de/10012216704
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Dividend policy, agency costs, and earned equity
DeAngelo, Harry (contributor); DeAngelo, Linda (contributor) - 2004 - [Elektronische Ressource]
Persistent link: https://www.econbiz.de/10002128466
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Can reinvestment risk explain the dividend and bond term structures?
Gonçalves, Andrei S. - 2018 - This Version: January, 2018
tradeoff between market and reinvestment risk explains this pattern. Intuitively, while long-term dividend claims are highly … exposed to market risk, they are also good hedges for reinvestment risk because dividend prices rise as expected returns … long maturities, inducing relatively low risk premia on long-term dividend claims. The model is also consistent with the …
Persistent link: https://www.econbiz.de/10011963382