Litigation against the largest subprime mortgage servicer in the US provides lessons about the appropriate regulation of mortgage servicing and adds to research about the causes of the financial crisis. Mortgage servicing is essential to the functioning of the financial system so servicers must...

We derive and test empirically a robust one-factor asset pricing model consistent with the multiple-priors approach of the ambiguity literature. The robust CAPM can explain the cross-section of expected U.S. stock returns without the need for additional risk factors. Further, observed anomalies...

Stock price ratios have long been used by finance practitioners as a relative value metric. A popular argument for this widespread use is that stock price ratios tend to revert to their long-run mean so that substantial deviations from historical averages could successfully be arbitraged away....

The stock price runup of target firms in the market for corporate control has been anecdotally attributed to inside trading. Moreover, the empirical merger and acquisitions literature documents a time-varying level and duration of the stock price runup of target firms. Using a market...