The personal traits of chief executive officers (CEOs) have been found to influence corporate policy decisions. We examine the impact of past professional distress experiences on payout policy. We hypothesize that CEOs experiencing a distress event in their past career, before becoming CEO,...

Using a sample of stocks experiencing large price changes in 40 countries over 20 years, we investigate the association between investors' traits that vary by national culture – overconfidence, conservatism, and risk tolerance – and proposed theoretical explanations for short-term equity...

In 2019, MIT hosted a 75th birthday symposium in honor of Robert C. Merton. The event included presentations by students and colleagues explaining the influence Merton has had on the profession and on their ideas. Each presenter focused on a specific aspect of Merton's life and contributions so...

We use an international sample of 20 developed countries to test theories predicting an association between operating leverage with stock returns and the value premium. Results suggest that operating leverage is related to stock returns and the value premium across the sampled countries. These...

We find strong evidence linking the momentum pattern in equity returns with a prominent measure of macroeconomic conditions, specifically the funding environment. We show that the size and consistency of the momentum premium varies systematically across funding states. Furthermore, we find...

We explore whether the well publicized anomalous returns associated with low-volatility stocks can be attributed to market mispricing or to compensation for higher systematic risk. Our results, conducted over a 46 year study period (1966-2011), indicate that the high returns related to...

Recent theoretical models (e.g., Carlson, Fisher and Giammarino, 2004) predict an association between the book-to-market (BE/ME) ratio and operating leverage in the cross-section. Consistent with these models, we find a strong positive association between BE/ME and the degree of operating...

We provide new evidence on the sequential financing explanation for the use of warrants. Consistent with sequential financing, capital spending starts increasing in the year of the call and peaks three years after the call. In addition, both equity and debt financing increase significantly in...