Corporate invesment and asset proce dynamics: implications for SEO event studies and long-run performance

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Corporate invesment and asset proce dynamics: implications for SEO event studies and long-run performance

Carlson, Murray - ; Fisher, Adlai - ; Giammarino, Bon - ;

We present a rational theory of SEOs that explains a pre-issuance price run-up, a negative announcement effect, and long-run post-issuance underperformance. When SEOs finance investment in a real options framework, expected returns decrease endogenously because growth options are converted into assets in place. Regardless of their risk, the new assets are less risky than the options they replace. Although both size and book-to-market effects are present, standard matching procedures fail to fully capture the dynamics of risk and expected return. We calibrate the model and show that it closely matches the primary features of SEO return dynamics..Printed Journal

Ketersediaan

Call Number	Location	Available
	PSB lt.dasar - Pascasarjana	1

Penerbit	The American Finance Association.,
Edisi	-
Subjek	-
ISBN/ISSN	221082
Klasifikasi	-
Deskripsi Fisik	-
Info Detail Spesifik	-
Other Version/Related	Tidak tersedia versi lain
Lampiran Berkas	Tidak Ada Data