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I find common institutional ownership in a customer and its supplier increases the duration of their supply chain relationship, particularly when the common ownership is long-term and vertical frictions are greater. Using an instrument constructed around a shock to common ownership following a...
Persistent link: https://www.econbiz.de/10012902630
We examine the influence of common ownership on commonalities in the information environment. Specifically, we study commonalities in financial statements and in the actions of key agents such as financial analysts and firm managers who contribute and respond to the information environment....
Persistent link: https://www.econbiz.de/10012866578
We examine whether earnings myopia among publicly traded companies motivates private equity firms to acquire them. Using a sample of private equity takeovers, we show that multiple measures of myopia increase the likelihood of takeover by private equity buyers. In contrast, private takeovers...
Persistent link: https://www.econbiz.de/10013212865
In this paper, I study the inclusion of cost savings and synergy add-backs (cost-synergy add-backs hereafter) in loan contracts. Such add-backs allow borrowers to add unrealized cost savings and synergy gains into contractual earnings calculations and thus reflect timely gain recognition in debt...
Persistent link: https://www.econbiz.de/10012595453
The overall market for derivative securities is often estimated as more than ten times the World's GDP and many decry the complexity of derivatives as a main contributor to the subprime financial crisis. In this paper, we investigate whether and why complexity is used as a proxy for risk when...
Persistent link: https://www.econbiz.de/10012837576
In this study, we examine how banks' stock price crash risk is affected by recourse uncertainty embedded in securitizations. By recourse uncertainty, we mean the difficulty for equity market participants to assess the true extent of risk transfer between securitizing banks and investors in...
Persistent link: https://www.econbiz.de/10012838262
We investigate the relation between portfolio constraints (tests) that Collateralized Loan Obligations (CLOs) have to pass monthly, CLO managers' loan trading choices and CLO equity returns. We find that stringent portfolio constraints are positively associated with the influence of CLO junior...
Persistent link: https://www.econbiz.de/10012888741
Prior evidence suggests that managers learn indirectly from stock prices, which contain private information impounded by informed investors' trades. However, stock price is an indirect aggregate signal, which is likely to be insufficient for managerial learning. I propose that managers seek out...
Persistent link: https://www.econbiz.de/10012823411
In recent decades, management modes for pension obligations has been coevolving with political and financial economic strategies aimed to prompt and promote active financial markets and institutional investors, as well as transnational harmonisation and convergence of accounting standards...
Persistent link: https://www.econbiz.de/10012971014
This study sheds new light on the cross-sectional effects of inflation, which have substantial implications for stock valuation. I use financial statement analysis to examine systematic stock-valuation effects of aggregate price-level changes on individual companies, focusing on the implications...
Persistent link: https://www.econbiz.de/10013007381