We investigate investor ESG preferences during economic distress revealed by US retail mutual fund flows. Using the COVID-19 pandemic as an unexpected shock to the economy, we show that "high ESG" funds with five-globe Morningstar sustainability ratings - which receive higher than average fund...

We propose a parsimonious measure based solely on daily stock returns to characterize the severity of microstructure frictions at the individual stock level and assess the impact of frictions on the cross section of stock returns. Stocks with the largest frictions command a value-weighted return...

Hedge fund activism removes the diversification discount in targeted conglomerate firms. Targeted conglomerates increase investment in segments with better growth opportunities, while reducing each division's over-reliance on their own cash flow relative to their reliance on cash flows from...