Bhanot, Karan; Mansi, Sattar A.; Wald, John K. - In: Journal of Empirical Finance 17 (2010) 3, pp. 381-393
Existing research suggests that, for a given firm, stock returns and bond prices are positively related, and this implies a negative relation between stock returns and bond spreads. In this paper, we show how takeover risk influences this relation. Bondholders of high-rated firms can suffer...