This paper uses a market valuation model to explore why firms grant employee stock options. When insider managers and outside investors have different opinions about the future prospects of the firm, employee stock options can be used to capture future investor overvaluation and to save employee...

Malmendier and Shanthikumar (2014) find that some analysts issue relatively higher stock recommendations and relatively lower earnings forecast of the same firm on the same day. They describe this behavior as speaking in two different tongues. In this paper, we explore the cost of this strategy...

In this paper, we study the performance of hated stocks, those stocks with the average analyst recommendation level of hold or worse. We show that from the beginning of 2009 to the end of 2014, this group of hated stocks in S&P 500 performs better than the other stocks in S&P 500. When we extend...

We study the strategy of shorting a pair of leveraged ETF and inverse leveraged ETF of the same index. The profitability of this strategy does not depend on the direction of the underlying benchmark. We derive an approximation formula to show that the expected return is high when the weighted...