Annual Conference

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Investment Finance

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May 2023

We uncover a significant relationship between the persistence of marketing employment strategy and fund performance in the U.S. mutual fund industry. Using regulatory filings, we show a large heterogeneity in fund companies’ marketing employment share, which refers to the fraction of employees dev...
Keywords: Marketing Employment Share, Persistence Marketing, Bayesian Persuasion, Costly Learning
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Annual Conference

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Investment Finance, Senior Fellows/Fellows

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May 2023

This paper examines the inflation forecastability of cross-sectional stocks. To differentiate the cross-sectional inflation exposures, we make the important observation that cross-sectional stock returns exhibit persistent sensitivity to headline inflation shocks during the calendar month of CPI, an...
Keywords: inflation, individual stock returns, core-CPI, announcements
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Annual Conference

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Investment Finance, Senior Fellows/Fellows

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May 2023

Recent evidence challenges the allocational efficiency of firms (in allocating capital to more productive sectors). We investigate whether financial intermediaries can help achieve better allocation. We find domestic mutual funds exhibit significant allocational efficiency in their equity investment...
Keywords: Allocational efficiency, Mutual Fund Investment, capital markets
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Annual Conference

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Investment Finance

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May 2023

Does emotional support matter for financial outcomes? Using microdata from U.S. and Australian household surveys, I document that individuals who lack emotional support are more likely to experience financial hardship. This relationship is not confounded by other forms of support—such as financial...
Keywords: emotional support, financial distress, social networks
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Annual Conference

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Investment Finance, Senior Fellows/Fellows

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May 2023

We explain stock mispricing linked to long-term expectations of earnings growth in terms of managerial manipulation in high-growth conglomerates. Manipulation does not affect analysts’ forecasts of conglomerate earnings, which are more accurate relative to pseudo-conglomerates. The combined effect...
Keywords: overreaction, analyst forecasts, return predictability, earnings predictability, managerial manipula
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