Recent work presents evidence that certain groups of institutional investors are able to trade profitably based on private information about earnings and returns. We contribute to this literature in three ways. First, we test whether certain private information proxies are consistent with the...

This paper provides evidence that financial reporting quality (FRQ) influences the holding costs of trading strategies. While prior research has focused on the benefits of investment strategies based on poor FRQ (i.e., larger returns due to a greater amount of private information), we examine...

Agency theory suggests that if a principal observes a signal suggesting that an agent has made a value-destroying decision, then the principal would be more likely to dismiss that agent. We label the increase in the pressure a manager feels to retain his job following an acquisition poorly...

This paper investigates whether fundamental accounting information is appropriately priced in the options market. We find that fundamental accounting signals exhibit incremental predictive power with respect to future option returns above and beyond what is captured by implied and historical...

We examine the incidence, valuation and management of tax-related reputational costs during 2011, a year containing numerous protests that increased scrutiny of corporate tax avoidance. We report three main results. First, consistent with firms incurring tax-related reputational costs, we find...