In this paper, we propose a tractable model to study the impact of path-dependent reference points on optimal trading strategies of a realization utility investor. We find that when reference points are adaptive to prior paper gains and losses, two interesting effects arise endogenously: (a)...

We consider a privately informed issuer which holds a portfolio of assets that can be sold to raise cash, where the fractions of assets sold serve as a multidimensional signal. If good news about one asset is good news for the others, then there is a unique equilibrium that satisfies the...