its core, the strategy is one that earns an excess return for the assumption of a specified risk. Merger arbs purchase … usually trade some measure below the agreed-upon merger price, due to the risk that the merger might not actually occur. If … identifies a merger arbitrage risk factor that is superior to market beta in explaining the risks assumed by a merger arbitrage …

important in merger arbitrage, where deal failure is a key risk. In this paper, I propose a dynamic asset pricing model that … addition, the model accurately predicts that merger arbitrage exhibits low volatility and a large Sharpe ratio when deals are …

Adjustment of behavior to maintain risk, known as risk homeostasis, has previously been studied in a variety of … psychological, health, social and economic contexts. This paper examines the evidence for risk homeostasis in corporate financial …-bidding peer firms prior to M&As, relative risk levels subsequently return to original levels. We argue this pattern is consistent …

-level uncertainty is characterized by a pecking order: the announcement of a domestic takeover leads to a reduction in the uncertainty …

Political and regulatory uncertainty is strongly negatively associated with merger and acquisition activity at the … cannot be delayed due to competition and for deals that hedge firm-level risk. Contractual mechanisms (deal premiums …

important in merger arbitrage, where deal failure is a key risk. In this paper, I propose a dynamic asset pricing model that … addition, the model accurately predicts that merger arbitrage exhibits low volatility and a large Sharpe ratio when deals are …

We use data from the past 30 years of takeover activity in the U.S. banking industry to test competing neoclassical and … misvaluation merger theories. Test results are consistent with evidence in the literature that merger activity is significantly … misvaluation reflect a rise in industry-wide risk taking and that increases in risk originate from changes in industry structure …

changes in risk arbitrageurs' holdings surrounding the time of an announcement, whose ability to predict deal outcomes is … be renegotiated, to feature slower completion times, and to fail even after controlling for merger arbitrage spreads and … announcement returns. A trading strategy that involves investing in target firms with a low degree of failure risk, as predicted by …