Showing 1 - 9 of 9
Persistent link: https://www.econbiz.de/10005302560
Merton's recent extension of the capital asset pricing model proposed that asset returns are an increasing function of their beta risk, residual risk, and size, and a decreasing function of the public availability of information about them. Associating the latter with asset liquidity and...
Persistent link: https://www.econbiz.de/10005302919
The effects of asset liquidity on expected returns for assets with infinite maturities (stocks) are examined for bonds (Treasury notes and bills with matched maturities of less than six months). The yield to maturity is higher on notes, which have lower liquidity. The yield differential between...
Persistent link: https://www.econbiz.de/10005309282
We provide an economic basis for permitting freezeouts of nontendering shareholders following successful takeovers. We describe a specific freezeout mechanism based on easily verifiable information that induces desirable efficiency and welfare properties in models of both corporations with...
Persistent link: https://www.econbiz.de/10005214087
The authors study the joint effect of the trading mechanism and the time at which transactions take place on the behavior of stock returns using data from Japan. The Tokyo Stock Exchange employs a periodic clearing procedure twice a day, at the opening of both the morning and the afternoon...
Persistent link: https://www.econbiz.de/10005214110
Persistent link: https://www.econbiz.de/10005214264
Merton (1987) proposes that an increase in a firm's investor base increases the firm's value. In Japan, companies can reduce their stock's minimum trading unit-the number of shares in a "round lot"-which facilitates trading in the stock by small investors. We find that a reduction in the minimum...
Persistent link: https://www.econbiz.de/10005214464
The authors test the proposition that corporate control considerations motivate the means of investment financing-cash (and debt) or stock. Corporate insiders who value control will prefer financing investments by cash or debt rather than by issuing new stock, which dilutes their holdings and...
Persistent link: https://www.econbiz.de/10005334789
The higher taxation of dividends in the United States gave rise to theories that explain why companies pay dividends. Tax-based signaling models propose that the higher tax on dividends is a necessary condition to make them informative about companies' values. In Germany, where dividends are not...
Persistent link: https://www.econbiz.de/10005691116