We study the dynamic implications of capital investment in innovative capacity (IC) on future stock returns, investment …, and profitability by modeling the unique effects of IC investment on uncertain option generation/exercise and post …-exercise revenue. The model highlights the diverse effects of IC investment on expected returns in different post-investment regimes …

firm into two parts: (1) the risk due to the investment strategy of the pension plan (“Mismatch Risk”); and (2) the risk …We develop an analytical framework that divides the contribution of pension risk to the total systematic risk of the … due to the funded status of the pension plan (“Deficit Risk”). We then use this framework to show that the financial …

valuation changes are measures of target valuation uncertainty. Risk-averse acquirer managers likely require compensation when … their firms take on valuation risk through the acquisition of hard-to-value targets. Diversified shareholders of public … offloading idiosyncratic risk. Without compensation for the acquirer in the form of lower acquisition prices, acquirer managers …

borderline between investment grade and junk. Finally, we are able to empirically exclude a large number of alternative …

employers' investment banking (IB) and brokerage businesses. We consider four aspects of forecast quality: accuracy, bias, and …