Research by Itzhak Ben-David, the Neil Klatskin Chair in Finance and Real Estate, and Justin Birru, associate professor of finance, helps add context to the discussion about the historical and actual performance and management fees associated with hedge funds. 

Assistant Professor of Finance Amin Shams explains one reason why cryptocurrency crashes often happen on weekends, volatility that has drawn scrutiny from regulators weighing the future of digital currency.

Research from Rene Stulz, the Everett D. Reese Chair of Banking and Monetary Economics, shows the percentage of total corporate profits coming from the 100 biggest earners has skyrocketed over the past three decades. And what previously was a danger sign —  outsized valuation — may now be the new normal.

Rene Stulz, the Everett D. Reese Chair of Banking and Monetary Economics, and his colleagues detail a new paper that explores whether a firm’s corporate policies are influenced more by index peers after it becomes a member of the S&P 500 than before.

With investments, popular is not better. And the increase of new cash into stocks doesn't always portend good news. In fact, research by Itzhak Ben-David, the Neil Klatskin Chair in Finance and Real Estate, and Byungwook Kim, focused on the specialized ETFs that are created to capitalize on investor fads and market trends, and which typically receive a big influx of cash soon after launch. They found that these ETFs over their first five years after launch lag the market on a risk-adjusted basis by 5% per year on average.

Research from Rene Stulz, the Everett D. Reese Chair in Banking and Monetary Finance, supports the belief that the shift to a “winner-take-all” economy, in which the largest corporations earn an increasing share of all corporate profits, has resulted in industries being dominated by their very largest companies.

A major trader of digital currency went live on the NASDAQ Wednesday, soaring and plunging in the first few hours of trading. Although it’s an exciting day for digital currency, it doesn’t mark the end of dollars and cents, says Matt Sheridan, a senior lecturer in finance. It does, however, legitimize other crypto assets such as Bitcoin.

Thematic ETFs are one of the big investment stories of the last year, with major success in areas such as clean energy. Yet niche investments come with risks, including the prospect of buying in at the top and structural complications, according to new research from Itzhak Ben-David, the Neil Klatskin Chair in Finance and Real Estate, and his colleagues.

A study by Itzhak Ben-David, the Neil Klatskin Chair in Finance and Real Estate, and Fisher PhD candidate Byung Wook Kim finds that many new ETFs invest in overvalued stocks, and then lag behind the broad market’s returns.

Finance lecturer Matt Sheridan on the Robinhood and GameStop situation: "This is so crazy that if this was the plot of an episode of Showtime’s "Billions," people would think it’s too unrealistic." He explains the factors at play in the unique investing situation.

Research conducted by Itzhak Ben-David, the Neil Klatskin Chair in Finance and Real Estate, and his colleagues, shows average returns underperform the market by about four percentage points a year. The researchers argue that the huge growth in the ETF industry has intensified competition to the point that issuers are “competing for investors’ attention by emphasizing either the low price or the product’s unique features."

New research from Itzhak Ben-David, the Neil Klatskin Chair in Finance and Real Estate, doctoral student Byungwook Kim and their colleagues found that “Demand for specialized ETFs comes from unsophisticated investors who chase investment ideas that, in their view, will produce higher expected returns.” The result are overvalued stocks that actually lost as much as 5% per year on a risk-adjusted basis between 2000 and 2019.

Research from a pair of finance faculty members, including Itzhak Ben-David, the Neil Klatskin Chair in Finance and Real Estate, provides context to a closer look at the performance of specialized — or thematic — Exchange Trade Funds (ETFs).

Are specialized Exchange Trade Funds (ETFs) that are built around hot industries like cannabis, cybersecurity, and work-from-home businesses good ideas? Research from Itzhak Ben-David, the Neil Klatskin Chair in Finance and Real Estate, and PhD candidate Byungwook Kim provides a cautionary tale for investors. 

In 2017, Alex Pickard had made so much money from Bitcoin that he quit his job in finance and moved to Washington state to mine digital coins full time. Less than a year later, the venture had failed and he was back at quant firm Research Affiliates.

In a recent study, Xue Wang, associate professor of accounting and management information systems, and her colleagues move the debate on shareholder lawsuits forward by studying the impact of shareholder litigation threats on CEOs’ employment.

They have been attacked by many academics and progressive politicians. Now, with a new administration, the battle could soon get even more heated. Rene Stulz, the Everett D. Reese Chair of Banking and Monetary Economics, shares insights into stock buybacks.

The stock market is often misused as a bellwether for the economy, especially in political debates. Yet the market has never reliably moved in concert with the economy. And today the connection between the two is weaker than at any point since World War II, according to research by Rene Stulz, Everett D. Reese Chair of Banking and Monetary Economics at Fisher, and a colleague.

This new study by Rene Stulz, the Everett D. Reese Chair of Banking and Monetary Economics, and his colleagues crunches the numbers and finds the disconnect between the stock market and the economy increases as valuations become more stretched.

A paper by Frederik P. Schlingemann and Rene M. Stulz, the Everett D. Reese Chair of Banking and Monetary Economics, seems to confirm New York Times columnist Paul Krugman's suspicions. It’s titled “Has the stock market become less representative of the economy?”, and its conclusion seems to be yes, at least as far as jobs are concerned.

On its surface, the structure of hedge fund incentive fees appears to closely align the incentives of hedge fund managers and hedge fund investors. But how do these incentive fees fare in practice? Research from Itzhak Ben-David, the Neil Klatskin Chair in Finance and Real Estate, Associate Professor of Finance Justin Birru, and a colleague explores these fees.

The trend to passive investing has led to a dramatic increase in the share of assets concentrated in the hands of a few large institutional fund companies. Research by Itzhak Ben-David, the Neil Klatskin Chair in Finance and Real Estate, and his colleagues concluded that “ownership by large institutions is associated with higher stock price volatility, autocorrelation in returns (a measure of price inefficiency), and a greater magnitude of price drops at times of market stress (a measure of price fragility).”

If you already see hedge fund fees as exorbitant, you ain’t seen nothing yet. Over the past two decades, the hedge fund industry has kept 64 cents of every dollar of gross profits that it has generated above the risk-free rate. This, according to research by Itzhak Ben-David, the Neil Klatskin Chair in Real Estate and Finance, and Finance Professor Justin Birru, and a colleague.

This year, index fund investors are making money all right. But it's come with some risks: Much of the gains are due to half a dozen ultra-hot technology stocks. Lu Zhang, the John W. Galbreath Chair in Finance, provides some additional context to the presence of tech stocks in our portfolios.

Investors who put their money in hedge funds may find that the fees are much higher than expected, a new study from Itzhak Ben-David, the Neil Klatskin Chair in Real Estate, and Associate Professor of Finance Justin Birru suggests. Most hedge funds charge their clients incentive fees of about 20 percent of gains made over a specified benchmark. But in a study of 6,000 hedge funds over 22 years, researchers found that those fees ended up costing investors nearly 50 percent – about 2.5 times more than the average fee rate on paper.