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CEO Incentives and Institutional Trader Monitoring are Substitutes : Theory and Evidence

Chen, Brandon - 2012

The traditional view on CEO pay suggests that the use of equity-based incentives (e.g., stocks and options) should … relative sense, when comparing with CEOs' non-equity-based incentives (e.g., bonus). We confirm our model's prediction to show … that the use of equity-based incentives actually falls when institutional traders impound more information in stock prices …

Persistent link: https://www.econbiz.de/10013116442

Dynamic Incentives for Buy-Side Analysts

Deb, Rahul - 2020

We develop a dynamic adverse selection model where a career-concerned buy-side analyst advises a fund manager about investment decisions. The analyst's ability is privately known, as is any information she learns over time. The manager wants to elicit information to maximize fund performance...

Persistent link: https://www.econbiz.de/10012849367

Do Institutional Incentives Distort Asset Prices?

Lines, Anton - 2016

without direct benchmarking incentives show no effect. My findings cannot be explained by fund flows and thus constitute a new …

Persistent link: https://www.econbiz.de/10012978817

Once a trader, always a trader : the role of traders in fund management

Cici, Gjergji; Schuster, Philipp; Weishaupt, Franziska - 2024

Mutual fund families are increasingly assigning traders to manage corporate bond mutual funds. Using this setting to study the role of traders in investment management, we document that trader managers identify and exploit short-term trading opportunities at lower transaction costs. These skills...

Persistent link: https://www.econbiz.de/10014467713

Risk management, rational herding and institutional investors : a macro view

Menkhoff, Lukas; Lütje, Torben - 2003

risk managers. This paper analyzes their risk management behavior from a macro perspective and focuses on their incentives … more strongly than more junior managers. Regarding herding as rational strategy of adapting to incentives, one might …

Persistent link: https://www.econbiz.de/10010262912

Risk Aversion : Differential Conditions for the Concavity in Transformed Two-Parameter Distributions

Corradin, Fausto; Sartore, Domenico - 2016

The condition of Risk Aversion implies that the Utility Function must be concave. Taking into account the dependence of the Utility Function on the wealth that in turn depends on the return, we consider a return with any type of two-parameter distribution. It is possible to define Risk and...

Persistent link: https://www.econbiz.de/10014124383

Origins of Mutual Fund Skill : Market versus Accounting Based Asset Pricing Anomalies

Christiansen, Charlotte; Xing, Ran; Xu, Yue - 2021

We investigate the information source of active U.S. equity mutual funds’ value added using 234 public asset pricing anomalies. On average, mutual funds add value through their positive exposures to anomalies based on market information (e.g., momentum and liquidity risk) and lose value...

Persistent link: https://www.econbiz.de/10013250271

Why Do Financial Analysts Strive to Be Irrelevant? Career Concerns and Endogenous Coverage Termination

Navone, Marco A. - 2016

In this paper we investigate the negative relationship between analysts' coverage and stocks idiosyncratic volatility. While prior research argues that analysts cause the low level of idiosyncratic risk because they lack access to firm-specific information we hypothesize that the causal relation...

Persistent link: https://www.econbiz.de/10013004785

On the Dynamics of Corporate Bond Ownership

Massa, Massimo - 2016

We examine the dynamic ownership structure of corporate bonds after initial issuance. We find that as bonds “season”, the market learns more about them. This learning leads to less concentrated bond ownership over time. Specifically, learning induces a shift in bond ownership from more...

Persistent link: https://www.econbiz.de/10013006063

Investing in Security Price Informativeness : The Role of IPO Underpricing

Brown, David C. - 2016

future, profitable IPO participation provide incentives for investors to produce information after the IPO. Increasing … underpricing strengthens these incentives, resulting in a more informative post-IPO price and higher firm value. Firms' desires for …

Persistent link: https://www.econbiz.de/10013007039