Annual Conference

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Corporate Finance, Senior Fellows/Fellows

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May 2013

Does Corporate Hedging Attract Foreign Investors? Evidence from International Firms

Massimo MASSA, Lei ZHANG
We study how corporate hedging affects the demand of foreign institutional investors. We collect measures of foreign exchange hedging and interest rate hedging for a comprehensive sample of international companies. We document a strongly positive relationship between foreign institutional demand and...
Keywords: hedging, foreign exchange hedging, interest rate hedging, foreign ownership, international institutional investors
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Annual Conference

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Corporate Finance

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May 2013

Family Business Group Expansion through IPOs: The Role of Internal Capital in Financing Growth while Preserving Control

Peter Kien PHAM, Jason ZEIN, Stephanie DASH, Ronald W. MASULIS
Using data from 44 countries, we document a new channel through which a family business group's internal capital market supports its members. We find that groups use internal capital to incubate difficult-to-finance projects, making it feasible for them to rapidly scale up, thus facilitating their I...
Keywords: business groups, internal capital markets, Financing Constraints, IPOs
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Annual Conference

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Corporate Finance, Senior Fellows/Fellows

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May 2013

Employee Inside Debt and Firm Risk-Taking: Evidence from Employee Deposit Programs in Japan

Yupeng LIN, Takeshi YAMADA, Sudipto DASGUPTA, Zilong ZHANG
Unlike broad-based equity ownership by employees, ownership of company debt by rank-and-file employees has not received much attention. We argue that company debt held by employees in the form of in-company deposits can monitor risk-taking and facilitate risk discovery. Employee deposits have been h...
Keywords: inside debt, risk-taking, employee deposits, agency costs of debt
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Annual Conference

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Senior Fellows/Fellows, Capital Market Development: China and Asia

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May 2013

Fire-sales and Information Advantage: When Bank-Affiliation Helps

Massimo MASSA, Lei ZHANG
We study how information flows within international financial conglomerates and how such a flow reduces the transmission of liquidity crisis due to fire-sales. We focus on the role of international institutional investors affiliated with banks during the 2008-2009 global financial crisis. We argue t...
Keywords: fire-sales, crisis, bank-affiliation, foreign ownership, liquidity
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Annual Conference

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Senior Fellows/Fellows, Capital Market Development: China and Asia

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May 2013

Getting Better: Learning to Invest in an Emerging Stock Market

Tarun RAMADORAI, John Y. CAMPBELL, Benjamin RANISH
This paper reports evidence that individual investors in Indian equities hold better performing portfolios as they become more experienced in the equity market. Experienced investors tilt their portfolios profi…tably towards value stocks and stocks with low turnover, but these tilts do not fully ex...
Keywords: Emerging stock market, equity market, value stocks
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