Buyback Derangement Syndrome

13 Pages Posted: 8 Dec 2017 Last revised: 28 Feb 2018

See all articles by Clifford S. Asness

Clifford S. Asness

AQR Capital Management, LLC

Todd M. Hazelkorn

AQR Capital Management, LLC

Scott A. Richardson

London Business School; Acadian Asset Management

Date Written: November 1, 2017


The popular press is replete with commentary seeking to damn the behavior of corporate managers in handing free cash flow back into the hands of shareholders. These criticisms are often, even regularly, without merit (at least merit that can be demonstrated), sometimes glaringly so. Aggregate share repurchase activity has not been at historical highs when measured properly, and when netted against debt issuance is almost a non-event, does not mechanically create earnings (EPS) growth, does not stifle aggregate investment activity, and has not been the primary cause for recent stock market strength. These myths should be discarded.

Keywords: Share Repurchases, Buybacks

JEL Classification: G35, G00, G10, G14, G30, G32

Suggested Citation

Asness, Cliff S. and Hazelkorn, Todd and Richardson, Scott Anthony, Buyback Derangement Syndrome (November 1, 2017). Journalof Portfolio Management, Forthcoming, Available at SSRN: or

Cliff S. Asness

AQR Capital Management, LLC ( email )

Two Greenwich Plaza, 3rd Floor
Greenwich, CT 06830
United States
203-742-3601 (Phone)
203-742-3101 (Fax)


Todd Hazelkorn (Contact Author)

AQR Capital Management, LLC ( email )

Greenwich, CT
United States
203 742 3914 (Phone)


Scott Anthony Richardson

London Business School ( email )

Sussex Place
Regent's Park
London, London NW1 4SA
United Kingdom

Acadian Asset Management ( email )

260 Franklin Street
Boston, MA 02110
United States

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