This paper investigates how precautionary trading behavior of fund managers induced by a higher junior fee component in … from Collateralized Loan Obligation (CLO) funds, we find that fund managers with a higher ratio of subordinate fee to total … fees are more likely to sell downgraded loans. Fund managers exhibit such precautionary trading behavior even when …

Prior research has often taken the view that entrenched managers tend to avoid debt. Contrary to this view, we find … that firms with entrenched managers, as measured by the Gompers et al. (2003) governance index, use more debt finance and … financing. Our evidence is consistent with entrenched managers receiving better access to debt markets (better credit ratings …

Prior research has often taken the view that entrenched managers tend to avoid debt. Contrary to this view, we find … that firms with entrenched managers, as measured by the Gompers et al. (2003) governance index, use more debt finance and … financing and have higher subsequent leverage. Our evidence is consistent with entrenched managers receiving better access to …