Recent research questions the existence of a conglomerate discount. This study addresses two of the most important explanations for the conglomerate discount and finds evidence in support of an economically and statistically significant discount. The first explanation is that the risk-reducing...

We use a dataset from a large retail bank to examine the impact of financial advice on investors' stock trading performance and behavioral biases. Our data allow us to classify each individual trade as either advised or independent and to compare them in a trade-by-trade within-person analysis....

We show that a sample of 7,487 U.S. firms going public between 1975 and 2014 significantly underperforms mature firms in the first year after the IPO. Contrary to post-issue horizons of three to five years, the first-year underperformance cannot be explained by Carhart (1997) risk factor...

We investigate whether the diversification discount is simply a proxy for poor corporate governance. We find that the negative value impact of diversification is amplified by adverse governance variables such as low CEO ownership, low board independence, and board classification, and that...

We investigate whether the diversification discount occurs partly as an artifact of poor corporate governance. In panel data models, we find that the discount narrows by 16% to 21% when we add governance variables as regression controls. We also estimate Heckman selection models that account for...