BROCKMAN, PAUL; MARTIN, XIUMIN; UNLU, EMRE - In: Journal of Finance 65 (2010) 3, pp. 1123-1161
Executive compensation influences managerial risk preferences through executives' portfolio sensitivities to changes in stock prices (delta) and stock return volatility (vega). Large deltas discourage managerial risk-taking, while large vegas encourage risk-taking. Theory suggests that...