In this paper, we develop a theoretical model to explain the well-established empirical regularities that have been documented in the literature on closed-end funds (CEFs). In the presence of heterogeneous beliefs and short-sale constraints, both the CEF price and the price of the assets that it...

The well-documented negative association between idiosyncratic volatility (IV) and stock returns is puzzling if investors are risk-averse. We show that this anomaly is also prominent in the Chinese stock market. We attempt to explain the IV anomaly by using the key theories suggested by the...

Firms with higher R&D intensity subsequently experience higher stock returns in international stock markets, highlighting the role of intangible investments in international asset pricing. The R&D effect is stronger in countries where growth option risk is more likely priced, but is unrelated to...

Prior literature documents mixed evidence about how research and development activities affect corporate creditworthiness. We investigate whether publicly available patent information is incrementally useful in assessing the benefits and risks of corporate innovation from bondholders'...

By constructing high-frequency measures of informed trading and news about technological competition, we provide evidence that the news about a firm's disadvantage in competition leads to informed selling. Such a pattern is weaker among firms in the industries with faster technology obsolescence...

Patent thickets, a phenomenon of fragmented ownership of overlapping patent rights, hamper firms' commercialization of patents and thus deliver asset pricing implications. We show that firms with deeper patent thickets are involved in more patent litigations, launch fewer new products, and...