The investor preference for home assets rather than a diversified portfolio of international assets termed 'home bias' remains a puzzle, given recent information and technology improvements, although presumed risk reduction benefits may have been reduced through improved financial market...

This article presents a study of asset price volatility, correlation trends and market risk premia. Recent evidence shows an increase in firm-level volatility and a decline of the correlation among stock returns in the US (Campbell et al., 2001). We find that, in relation to the Euro-area stock...

We investigate capital structure dynamics in a unique financing environment where (1) we avoid the complex tax environments faced by previous studies and where (2) firms rely primarily on bank loans rather than the public debt market. Consistent with recent empirical evidence, we find that stock...