|
|
|
|
||||
|
||||
Investor Horizons and Corporate PoliciesFrançois DerrienHEC Paris - Finance Department David ThesmarHEC Paris - Finance Department Ambrus KecskesVirginia Polytechnic Institute & State University - Department of Finance, Insurance, and Business Law June 27, 2012 Journal of Financial and Quantitative Analysis (JFQA), Forthcoming Abstract: We study the effect of investor horizons on corporate behavior. We argue that longer investor horizons attenuate the effect of stock mispricing on corporate policies. Consistent with our argument, we find that when a firm is undervalued, greater long-term investor ownership is associated with more investment, more equity financing, and less payouts to shareholders. Our results do not appear to be explained by long-term investor self-selection, monitoring (corporate governance), or concentration (blockholdings). Our results are consistent with a version of market timing in which mispriced firms cater to the tastes of their short-term investors rather than their long-term investors.
Number of Pages in PDF File: 52 Keywords: Investor horizons, Institutional investors, Investment, Financing, Payouts, Mispricing, Market timing JEL Classification: G23, G31, G32, G35 Accepted Paper SeriesDate posted: October 21, 2009 ; Last revised: March 9, 2013Suggested CitationContact Information
|
|
|||||||||||||||||||||||||||||||
© 2013 Social Science Electronic Publishing, Inc. All Rights Reserved.
FAQ
Terms of Use
Privacy Policy
Copyright
This page was processed by apollo4 in 1.265 seconds
