This paper examines the association between the default risk of foreign bank subsidiaries and their parents during the global financial crisis, with the purpose of understanding what factors can help insulate affiliates from their parents. The paper finds evidence of a significant positive...

Using close to 800,000 (2,000,000) transactions by 66,000 (303,000) households in the United States (in Finland), this paper shows that individual investors with longer holding periods choose to hold less liquid stocks in their portfolios, consistent with Amihud and Mendelson's (1986) theory of...

This work consists of three essays that investigate the effect of investor behavior on asset prices. In the first essay, titled “Transaction Costs and Investment Decisions of Individual Investors,” I study the liquidity decisions of 66,000 households from a large discount brokerage. My paper...

Although financial theory suggests a positive relationship between default risk and equity returns, recent empirical papers find anomalously low returns for stocks with high probabilities of default. The authors show that returns to distressed stocks previously documented are really an...