Sky Blog
In recent years, regulatory shifts in financial reporting have garnered significant attention, especially concerning their implications for corporate governance and market dynamics. One notable change was the 2017 regulatory adjustment on the Tel-Aviv Stock Exchange (TASE), where small-cap firms were …
In a recent piece, I argue that corporate leaders should not shy away from making a public statement if they believe it is the right thing to do and consistent with the corporation’s values.[1]
The opportunities to speak are …
For decades, there has been an important debate over how much securities regulators should focus on protecting small investors. The regulators themselves have generally aimed to create a level playing field among investors, and historically, new technology has been an …
Many studies of seasoned equity offerings (SEOs) have attempted to explain the decline of a company’s stock price after it announces an SEO (see, e.g., Asquith and Mullins (1986) or Masulis and Korwar (1986)). The literature has focused on the …
On December 3, 2019, Japan’s Government Pension Fund (GPIF) announced that it would suspend share lending to short sellers. This is the latest development in a growing global regulatory skepticism of shorting, with Reuters recently reporting that short selling …
Advances in information technology have revolutionized the dissemination and acquisition of firm-specific information, allowing investors and other stakeholders to quickly assess firm performance and value and monitor management effectively. Our research examines the impact of information technology on the ability …
Institutional Shareholder Services (ISS) recently introduced Economic Value Added (EVA) as its latest approach to measuring company performance. Recent white papers from ISS, authored by Bennett Stewart (ISS Senior Advisor), who, along with former business partner Joel Stern, developed the …
How does the stock market respond to news reports about a company? Previous work has found that it takes a few days for prices to fully absorb news, and this underreaction has been attributed to investors’ limited ability to process …
Recent advances in machine learning and natural language processing (NLP) enable machines to better understand human languages. E-mail systems now routinely warn us when an email we receive may be a spam, suggest a quick response to an email, correct …
Prices convey information. Hayek (1945) put it this way: Prices “coordinate the separate actions of different people in the same way as subjective values help the individual to coordinate the parts of his plan.” Stock prices, in particular, matter a …
Legal academics and practitioners have long emphasized the important role that disclosure plays in the initial public offering (IPO) process. Issuers and their underwriters provide information via a prospectus and corresponding IPO roadshow to mitigate the information gap between the …
Prior research has documented the existence of disclosure externalities, or information spillovers, between firms in a number of different settings. The idea is that when two firms are economically related, public disclosures by one firm can affect the stock price …
Despite the extensive scholarship on insider trading, relatively little attention has been directed to a basic but fundamental question: Does insider trading law actually affect the amount of insider trading? In a new article, available here, I seek to …
Merger activity seems to rise in step with the market. Academic papers suggest this may be due to bidders exploiting overvalued shares, a pro-cyclicality of merger economies of scale or available capital for deals, or simply the behavioral pressures of …