Active mutual funds that engage in securities lending through in-house lending agents should raise questions for institutional investors. These funds may “reach for lending fees” by overweighting high-fee stocks, according to a new working paper by Travis Johnson, an assistant professor of finance, and Gregory Weitzner, a PhD student, both from the University of Texas’ […]
“If you torture the data long enough, it will confess.” Opening the keynote address at the Northern Finance Association Conference in September with this quote by Nobel Prize-winning economist Ronald Coase, Campbell Harvey, professor of finance at Duke University, spoke about the challenges of using data empirically. He cited being careful about data selection, delegation, […]
In countries with weak law enforcement, what other market forces can help curb insider trading? A new working paper found the presence of foreign institutional investors can significantly reduce insider trading profitability, beyond the effect of domestic institutional ownership. This hypothesis is based on the reasoning that foreign institutional investors tend to come from home […]