Despite the ability to explain many puzzling phenomena in financial markets, direct tests of reference-dependent preferences of Kahneman and Tversky (1979, 1992) have mainly been conducted in experimental settings. We propose a novel test based on revealed preferences of real-world investors....

Hedged mutual funds proliferated following the 2007-2009 financial crisis. They became particularly popular with financial advisors because of their alleged downside protection. Did these funds deliver what they promised? We examine the performance of these funds with a focus on the post-2009...

Studies examine the relation between mutual fund performance and trading cost using a variety of proxies - the most common being portfolio turnover. Overall, the evidence is consistent with informational equilibrium, i.e., trading has zero net impact on performance. We offer an alternative...