One of the most important developments in the corporate loan market over the past decade has been the growing participation of institutional investors. As lenders, institutional investors routinely receive private information about borrowers. However, most of these investors also trade in public...

Previous literature has found that stock returns comove more than fundamentals. In this paper, I document the role of institutional clienteles in generating the comovement. To define clienteles, I apply clustering algorithms to institutional holdings. I find that the majority of institutional...

Basic economic principles suggest that a well-known trading strategy offers little economic profit. In this paper, we investigate whether skilled hedge fund managers are more likely to pursue unique investment strategies that result in superior performance. We propose a measure of the...

Using two proxies for investors’ political affiliation, we document sharp differences in stock returns between firms likely dominated by Democratic investors (blue stocks) and those dominated by Republican investors (red stocks) during the COVID pandemic. Red stocks have 20 basis points higher...

This paper documents a high and increasing capital concentration in the bond fund industry over the past three decades. Large funds deliver better performance and receive larger inflows than small funds, which explains the concentration of bond funds. However, large funds take more risks by...

We provide novel evidence that hedge fund performance is persistent following weak hedge fund markets, but is not persistent following strong markets. Specifically, we construct two performance measures, DownsideReturns and UpsideReturns, conditioned on the level of overall hedge fund sector...