I find that local investors, compared to nonlocal investors, significantly change the way through which they acquire information on the SEC EDGAR around earnings announcements. Local investors on average further increase the amount of information gathering starting approximately two weeks ahead...

I consider a rational expectations framework in which attention-constrained individuals compete against each other and institutions. The model reconciles a set of empirical facts that cannot be simultaneously explained by standard theories: retail trader portfolios are highly correlated, retail...

Portfolio constraints are widespread and have significant effects on asset prices. This paper studies the effects of constraints in a dynamic economy populated by investors with different risk aversions and beliefs about the rate of economic growth. The paper provides a comparison of various...

In this enhanced meta-study we categorize more than 200 different sources. Within it, we find a remarkable correlation between diligent sustainability business practices and economic performance. The first part of the report explores this thesis from a strategic management perspective, with...

This essay questions the notion that recent federal corporate governance regulation reflects the shareholder primacy model of corporate governance and argues that, instead, such regulation comports more closely with the investor protection norm embedded in the federal securities laws. A key to...

The primary market is that part of the capital markets that deals with the issue of new securities. Companies, governments or public sector institutions can obtain funding through the sale of a new stock or bond issue. With the reforms of industrial policy, public sector, financial sector and...

Mispricing (the difference between prices and their underlying fundamental values) is an important characteristic of markets. The literature on the topic consists of many different measures. This state of affairs is unsatisfactory, since it is not clear to which extent results are sensitive to...

Motivated by recent evidence of informed trading by individual investors (Kaniel, Liu, Saar and Titman, 2012; Kelley and Tetlock, 2012), we posit that individual investor trading enhances firm performance. Consistent with the conjecture, we find that individual investor trading positively impacts...

Examining a set of pilot stocks experiencing releases of short-sale price tests by Regulation SHO, we find a significant decrease in put volume and price pressure of options of the pilot stocks after Regulation SHO. Violations of put-call parity and information content of option trading...

We consider an investor who faces parameter uncertainty in a continuous-time financial market. We model the investor's preference by a power utility function leading to constant relative risk aversion. We show that the loss in expected utility is large when using a simple plug-in strategy for...