We study how information about one firm transmits to otherwise unrelated firms sharing the same major blockholder. Using information on US firms over the 2001–2008 period, we show that the financial conditions of these firms signal the controlling ability of the owner and therefore indirectly...

We study how firms choose their debt maturity structure. We argue that because of lower information-gathering costs, institutional investors prefer to invest in firms with bonds outstanding across multiple maturities. We show that, in segmented markets, this preference for firms with bonds of...

We use a two-year panel of individual accounts in an S&P 500 index mutual fund to examine the trading and investment behavior of more than 91 thousand investors who have chosen a low-cost, passively managed vehicle for savings. This allows us to characterize investors' heterogeneity in terms of...

In the present paper we analyze the relationship between index funds and asset prices. In particular, our analysis of daily index fund flows indicates a strong contemporaneous correlation between fund inflows and S&P market returns. We also document a strong negative correlation between fund out...

We study holdings in merger and acquisition (M&A) targets by financial conglomerates in which affiliated investment banks advise the bidders. We show that advisors take positions in the targets before M&A announcements. These stakes are positively related to the probability of observing the bid...

Using a novel data set of institutional investors' bond holdings, we study a transmission mechanism that explains the contagion of the financial crisis of 2007-2008 from the securitized bond market to the corporate bond market. We argue that the crisis shock was propagated by the behavior of...

We examine the relation between international institutional ownership and payout policy using a comprehensive data set of equity holdings from 37 countries over the years 2000-2007. We find that foreign institutional ownership is negatively associated with the likelihood that a firm pays...

We study the role of institutional investors in cross-border mergers and acquisitions (M&As). We find that foreign institutional ownership is positively associated with the intensity of cross-border M&A activity worldwide. Foreign institutional ownership increases the probability that a merger...

We examine whether US shareholder-initiated class action lawsuits can discipline foreign firms. Using an international sample of firms over the period from 1995 to 2013, we find that a US class action lawsuit against a foreign firm cross-listed in the US negatively affects the value of that...

We study the role of institutional investors in cross-border mergers and acquisitions (Mamp;A). We find that foreign institutional ownership is positively associated with the intensity of cross-border Mamp;A activity worldwide. Foreign institutional ownership increases the probability that a...