García-Feijóo, Luis; Beyer, Scott; Johnson, Robert R. - In: The Financial Review 45 (2010) 3, pp. 541-556
We examine changes in equity and asset betas around convertible bond calls and report two major findings. First, calling firms exhibit an increase in asset betas following the call. We argue that the finding is consistent with the implications of the sequential financing theory but not of the...