J.B. Heaton

One Hat Research LLC

20 West Kinzie

17th Floor

Chicago, IL 60654

United States

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SCHOLARLY PAPERS

47

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35,520

SSRN CITATIONS
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Top 3,838

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74

CROSSREF CITATIONS

242

Ideas:
“  “Speak what you think today in hard words and tomorrow speak what tomorrow thinks in hard words again, though it contradict every thing you said today.” ― Ralph Waldo Emerson, Self-Reliance  ”

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Scholarly Papers (47)

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1.

Deep Learning for Finance: Deep Portfolios

Applied Stochastic Models in Business and Industry 33 (1), 3-12.
Number of pages: 15 Posted: 14 Sep 2016 Last Revised: 29 Apr 2019
J.B. Heaton, Nick Polson and Jan Witte
One Hat Research LLC, University of Chicago - Booth School of Business and University College London - Department of Mathematics
Downloads 8,246 (715)
Citation 30

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Deep Learning, Machine Learning, Big Data, Artificial Intelligence, Finance, Asset Pricing, Volatility, Deep Frontier

2.

Why Indexing Works

Applied Stochastic Models in Business and Industry 33 (6), 690-693.
Number of pages: 7 Posted: 14 Oct 2015 Last Revised: 29 Apr 2019
J.B. Heaton, Nick Polson and Jan Witte
One Hat Research LLC, University of Chicago - Booth School of Business and University College London - Department of Mathematics
Downloads 6,309 (1,128)
Citation 3

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Indexing, Passive Management, Active Management

3.

Managerial Optimism and Corporate Finance

Financial Management, Summer 2002
Number of pages: 14 Posted: 25 Apr 2002 Last Revised: 18 Feb 2019
J.B. Heaton
One Hat Research LLC
Downloads 4,078 (2,462)
Citation 21

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Behavioral Finance, Corporate Finance, Agency Costs, Asymmetric Information, Underinvestment, Overinvestment, Free Cash Flow

4.

Competing Theories of Financial Anomalies

The Review of Financial Studies, v 15 n 2 2002
Number of pages: 32 Posted: 25 Jan 2000 Last Revised: 18 Feb 2019
Alon Brav and J.B. Heaton
Duke University - Fuqua School of Business and One Hat Research LLC
Downloads 2,979 (4,165)
Citation 24

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5.

The Rational-Behavioral Debate in Financial Economics

Journal of Economic Methodology, 11:4, 393–409 December 2004
Number of pages: 17 Posted: 14 Jul 2004 Last Revised: 18 Feb 2019
Alon Brav, J.B. Heaton and Alex Rosenberg
Duke University - Fuqua School of Business, One Hat Research LLC and Duke University
Downloads 1,430 (14,005)

Abstract:

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Raional Finance, Behavioral Finance, Economic Methodolology

6.

Solvency Tests

Business Lawyer, Vol. 62, No. 3, 983-1006 (2007).
Number of pages: 24 Posted: 19 Sep 2006 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 1,428 (14,034)
Citation 5

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Insolvency, Bankruptcy, Fiduciary Duties, Creditors, Valuation

7.

Who Fields the Best Team?: A (Better) Measure of the Top Ten U.S. Law Schools by Faculty Impact

Number of pages: 11 Posted: 16 Nov 2018 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 1,338 (15,512)

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rankings, legal scholarship, top law schools

8.

The Limits of the Limits of Arbitrage

Downloads 1,219 ( 17,850)
Citation 6

The Limits of the Limits of Arbitrage

Review of Finance, 14(1):157-187 (2010)
Number of pages: 35 Posted: 12 Jul 2006 Last Revised: 18 Feb 2019
Alon Brav, J.B. Heaton and Si Li
Duke University - Fuqua School of Business, One Hat Research LLC and Wilfrid Laurier University - School of Business & Economics
Downloads 1,219 (17,529)
Citation 6

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Market Efficiency, Behavioral Finance, Limits on Arbitrage, Idiosyncratic Volatility

The Limits of the Limits of Arbitrage

Review of Finance, Vol. 14, Issue 1, pp. 157-187, 2010
Posted: 25 Jan 2010 Last Revised: 18 Feb 2019
Alon Brav, J.B. Heaton and Si Li
Duke University - Fuqua School of Business, One Hat Research LLC and Wilfrid Laurier University - School of Business & Economics

Abstract:

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G11, G12, G14

9.

How Active Management Survives

Downloads 1,014 ( 23,509)

How Active Management Survives

Financial Planning Review, forthcoming 2019.
Number of pages: 23 Posted: 20 Jun 2018 Last Revised: 28 Mar 2019
J.B. Heaton and Ginger Pennington
One Hat Research LLC and Northwestern University, Department of Psychology
Downloads 1,014 (23,123)
Citation 1

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Investor Psychology, Behavioral Finance, Active Management, Passive Management, Irrational Investors, Asset Management

How Active Management Survives

Financial Planning Review, Vol. 2, Issue 1, March 2019
Posted: 12 Nov 2019
J.B. Heaton and Ginger L. Pennington
One Hat Research LLC and University of Chicago - Booth School of Business

Abstract:

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10.

Naked Shorting

Regulation, 2008
Number of pages: 30 Posted: 30 Apr 2007 Last Revised: 18 Feb 2019
Christopher L. Culp and J.B. Heaton
Johns Hopkins University - Institute for Applied Economics, Global Health, and Study of Business Enterprise and One Hat Research LLC
Downloads 891 (28,343)
Citation 4

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Naked Shorting, Short Selling, Manipulation

11.

Deepening Insolvency

Downloads 673 ( 41,665)

Deepening Insolvency

Number of pages: 54 Posted: 23 Nov 2004 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 673 (41,073)

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Deepening insolvency, costs of financial distress

Deepening Insolvency

Posted: 27 Apr 2005
J.B. Heaton
One Hat Research LLC

Abstract:

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Deepening insolvency

12.

Event Studies in Securities Litigation: Low Power, Confounding Effects, and Bias

Washington University Law Review, Vol. 93, No. 2, 2015
Number of pages: 33 Posted: 21 Mar 2015 Last Revised: 23 Sep 2019
Alon Brav and J.B. Heaton
Duke University - Fuqua School of Business and One Hat Research LLC
Downloads 655 (43,230)
Citation 4

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event studies, securities litigation

13.

Quantitative Investing and the Limits of (Deep) Learning from Financial Data

47 Journal of Financial Transformation, 117-122 (2018).
Number of pages: 22 Posted: 08 Mar 2018 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 565 (52,462)
Citation 1

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quantitative investment management, hedge funds, deep learning, artificial intelligence, index funds

14.

Failed Anti-Activist Legislation: The Curious Case of the Brokaw Act

Journal of Business, Entrepreneurship and the Law, Forthcoming
Number of pages: 24 Posted: 29 Oct 2016 Last Revised: 23 Sep 2019
Alon Brav, J.B. Heaton and Jonathan Zandberg
Duke University - Fuqua School of Business, One Hat Research LLC and Boston College - Carroll School of Management
Downloads 550 (54,155)
Citation 2

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hedge fund activism, corporate law, shareholder activism, shareholder activist, hedge fund activist

15.

Overconfidence, Compensation Contracts, and Capital Budgeting

Journal of Finance, Vol. 66, No. 5, pp. 1725-77 (2011)
Number of pages: 53 Posted: 07 Mar 2011 Last Revised: 18 Feb 2019
Simon Gervais, J.B. Heaton and Terrance Odean
Duke University - Fuqua School of Business, One Hat Research LLC and University of California, Berkeley - Haas School of Business
Downloads 490 (62,688)
Citation 6

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overconfidence, capital budgeting, compensation, labor market

16.

Is the Cost of Equity Greater than the Risk-Free Rate?

Number of pages: 22 Posted: 23 Sep 2019 Last Revised: 14 Oct 2019
J.B. Heaton
One Hat Research LLC
Downloads 353 (92,493)

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discount rates, cost of capital, cost of equity, optimism

17.

Smart Money, Dumb Money, and Learning Type from Price

Number of pages: 23 Posted: 09 Aug 2011 Last Revised: 27 Sep 2019
J.B. Heaton and Nick Polson
One Hat Research LLC and University of Chicago - Booth School of Business
Downloads 308 (107,552)

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smart money, dumb money, noise traders, limits of arbitrage, learning, heterogeneous beliefs

18.

Corporate Governance and the Cult of Agency

Villanova Law Review, Forthcoming
Number of pages: 65 Posted: 10 Jul 2018 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 252 (132,922)
Citation 3

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Agency Problems, Agency Costs, Corporate Governance, Behavioral Law and Economics, Behavioral Finance, Corporate Law

19.

Sex, Drugs, and Rock 'N' Roll: Some Observations of Life on a Trial Team

64 South Dakota Law Review (2019), 175-182 (Lead Article).
Number of pages: 9 Posted: 22 Aug 2018 Last Revised: 27 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 230 (145,467)

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trial practice, substance abuse, legal education

20.

The 'Long Term' in Corporate Law

The Business Lawyer; Vol. 72, Spring 2017
Number of pages: 14 Posted: 07 Nov 2016 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 216 (154,432)
Citation 1

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Corporate Law, Corporate Governance, Shareholder Activism, Myopia

21.

The Altman Z Score Does Not Predict Bankruptcy

Number of pages: 8 Posted: 27 Apr 2020 Last Revised: 05 May 2020
J.B. Heaton
One Hat Research LLC
Downloads 214 (157,184)

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Altman Z, bankruptcy prediction, market evidence

22.

Simple Insolvency Detection for Publicly-Traded Firms

Business Lawyer (Summer 2019)
Number of pages: 12 Posted: 16 Feb 2019 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 186 (177,322)
Citation 1

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23.

Synthetic Financial Data: An Application to Regulatory Compliance for Broker-Dealers

Journal of Financial Transformation (Forthcoming)
Number of pages: 12 Posted: 23 Sep 2019 Last Revised: 23 Apr 2020
J.B. Heaton and Jan Witte
One Hat Research LLC and University College London - Department of Mathematics
Downloads 174 (188,064)
Citation 1

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Synthetic Data, Machine Learning, Best Interest, Compliance

24.

The Social Costs of Dividends and Share Repurchases

Journal of Business, Entrepreneurship & the Law (Forthcoming)
Number of pages: 17 Posted: 20 Feb 2019 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 157 (205,332)

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25.

The Siren Song of Litigation Funding

Forthcoming, Michigan Business & Entrepreneurial Law Review
Number of pages: 26 Posted: 21 Aug 2019 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 156 (206,431)

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26.

Hedge Fund Activism and Financial Performance

Forthcoming in The Oxford Handbook of Hedge Funds (Douglas Cumming and Geoffrey Wood, eds.)
Number of pages: 24 Posted: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 144 (220,508)

Abstract:

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shareholder activism, hedge fund activism, agency costs, corporate decline

27.

All You Need is Passive A Response to Professors Fisch, Hamdani, and Davidoff Solomon

Number of pages: 9 Posted: 10 Jul 2018 Last Revised: 02 Feb 2020
J.B. Heaton
One Hat Research LLC
Downloads 133 (234,981)
Citation 1

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Passive investing, corporate governance, securities law, mutual funds, ETFs, institutional investors, shareholder activism

28.

Kill Cammer: Securities Litigation Without Junk Science

11 Wm. & Mary Bus. L. Rev. 417 (2020).
Number of pages: 61 Posted: 28 Jun 2019 Last Revised: 04 May 2020
J.B. Heaton
One Hat Research LLC
Downloads 120 (254,059)

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29.

Three Reasons Active Equity Managers Underperform

Number of pages: 13 Posted: 16 Feb 2019 Last Revised: 10 Feb 2020
J.B. Heaton
One Hat Research LLC
Downloads 119 (255,622)

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Passive Management, Active Management, Indexing, Investment Strategy

30.

Simultaneous Risk Aversion and Risk-Seeking Behavior in an Expected Utility Framework with Optimism

Number of pages: 10 Posted: 19 Apr 2019 Last Revised: 14 Oct 2019
J.B. Heaton
One Hat Research LLC
Downloads 98 (292,480)

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optimism, prospect theory, Friedman-Savage utility, insurance, gambling, lotteries

31.

What Injures a Corporation? Toward Better Understanding Corporate Personality

Business Lawyer , Vol. 73, No. 4, 2018
Number of pages: 20 Posted: 11 Feb 2018 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 90 (308,701)

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Injury, Standing, Corporate Law, Corporate Litigation, Citizens United, Hobby Lobby, Corporate Personality

32.

Positive Equity Prices with Insolvency under Legal Solvency Tests

23 Journal of Forensic Economics, 63-70 (2018).
Number of pages: 15 Posted: 22 Nov 2016 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 90 (308,701)

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Solvency, Insolvency, Valuation, Option Value of Equity, Fraudulent Transfer, Preference, Shifting Fiduciary Duties

33.

Bias-Corrected Estimation of Price Impact in Securities Litigation

American Law and Economics Review, forthcoming 2019.
Number of pages: 25 Posted: 31 Jan 2019 Last Revised: 08 May 2019
Taylor Dove, Davidson Heath and J.B. Heaton
University of Utah - David Eccles School of Business, University of Utah - David Eccles School of Business and One Hat Research LLC
Downloads 83 (324,697)
Citation 1

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Event Studies, Securities Litigation, Bias Correction, Price Impact, Compensatory Damages, Punitive Damages

34.

Distance to Insolvency

AIRA Journal, Vol.32: No.4, 2020
Number of pages: 5 Posted: 27 Nov 2019 Last Revised: 18 Feb 2020
J.B. Heaton
One Hat Research LLC
Downloads 69 (360,769)

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distance to default, insolvency, Black-Scholes, Merton

35.

Market Indeterminacy

Number of pages: 36 Posted: 06 Oct 2003
Alon Brav and J.B. Heaton
Duke University - Fuqua School of Business and One Hat Research LLC
Downloads 63 (378,354)

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36.

Debt and Insolvency

38 Rev. Banking & Fin. L. 363 (2019).
Number of pages: 27 Posted: 20 Jun 2018 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 62 (381,400)

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Law and Finance, Security Design, Debt Capacity, Debt Yields, Insolvency, Capital Structure

37.

Managerial Optimism: New Observations on the Unifying Theory

Downloads 54 (407,582)

Managerial Optimism: New Observations on the Unifying Theory

European Financial Management (2019)
Number of pages: 18 Posted: 19 Apr 2019 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 54 (414,010)

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behavioral corporate finance, managerial optimism, agency cost theory, asymmetric information theory, pay for performance

Managerial Optimism: New Observations on the Unifying Theory

European Financial Management, Vol. 25, Issue 5, pp. 1150-1167, 2019
Number of pages: 18 Posted: 19 May 2020
J.B. Heaton
One Hat Research LLC
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agency cost theory, asymmetric information theory, behavioral corporate finance, managerial optimism, pay for performance

38.

Takeovers and the Dividend Discount Model

Number of pages: 10 Posted: 27 Jan 2020
J.B. Heaton
One Hat Research LLC
Downloads 52 (414,544)

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dividend discount model, implied cost of capital, takeovers, cost of equity

39.

Risk Aversion as Risk-Neutral Pessimism: A Simple Proof

International Review of Law and Economics, Forthcoming
Number of pages: 8 Posted: 29 May 2018 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 52 (414,544)
Citation 4

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Economic Analysis of Litigation, Risk Aversion, Risk Neutral Probabilities, Pessimism, Criminal Law, Plea Bargains, Settlement

40.

On the (Significant) Possibility of Informationally-Efficient Markets

Number of pages: 8 Posted: 23 Sep 2019 Last Revised: 04 Nov 2019
J.B. Heaton
One Hat Research LLC
Downloads 47 (432,871)

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optimism, overconfidence, market efficiency, limits to arbitrage, passive investing, active management

41.

Too Much Insolvency: 'Unmatured Interest' and 'Debt' Under the Code

American Bankruptcy Institute Law Review , Forthcoming
Number of pages: 5 Posted: 14 Dec 2017 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 45 (440,522)

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Insolvency, Solvency Tests, Bankruptcy Code

42.

Short Selling and the Game-Ending Greater Fool

Number of pages: 9 Posted: 27 Jan 2020 Last Revised: 28 Jan 2020
J.B. Heaton
One Hat Research LLC
Downloads 40 (461,059)

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short interest, short sellers, limits of arbitrage, optimism

43.

Insolvency Detection Using Publicly-Traded Debt and Equity

AIRA Journal, 32(2), 11-15 (2019).
Number of pages: 6 Posted: 23 Nov 2019
J.B. Heaton
One Hat Research LLC
Downloads 31 (502,319)

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44.

Settlement Pressure

International Review of Law and Economics, Vol. 25, pp. 264-275 (2005)
Number of pages: 12 Posted: 18 Apr 2004 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 17 (586,033)

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Class certification, settlement, civil procedure, economic analysis of litigation

45.

The Unfulfilled Promise of Hedge Fund Activism

Forthcoming, Virginia Law & Business Review
Posted: 19 Apr 2019 Last Revised: 23 Sep 2019
J.B. Heaton
One Hat Research LLC
Downloads 0 (725,758)

Abstract:

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46.

Worthless Companies

European Financial Management, Vol. 24, Issue 5, pp. 721-727, 2018
Number of pages: 7 Posted: 16 Nov 2018
J.B. Heaton
One Hat Research LLC
Downloads 0 (725,758)
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mergers & acquisitions, bad bidders, bubble company, unicorns, short selling

47.

Litigation Funding: An Economic Analysis

American Journl of Trial Advocacy, Forthcoming
Posted: 30 Jan 2018 Last Revised: 05 Jan 2020
J.B. Heaton
One Hat Research LLC
Downloads 0 (725,758)
Citation 1

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Litigation Funding, Economic Analysis of Litigation, Risk-Neutral Probabilities, Optimism, Pessimism