This paper argues that institutional investors may have a positive effect on stock prices. This effect realizes through different mechanisms: institutional investors reduce information asymmetries between firms and (other) investors, contribute to the liquidity of the company’s stock and...

The design of capital structure in quoted companies has received much attention in the academic literature. Using panel data from quoted as well as non quoted Belgian companies, this paper investigates not only the determinants of capital structure, but also the influence of a stock listing on...

Recent empirical research has stressed the importance of economy wide factors in the assessment of default risk, for instance for bond portfolios or portfolios of bank loans. Macroeconomic risk is essentially systematic, as it is difficult to reduce through diversification. Adequate forecasts of...

The bankruptcy prediction literature generally ignores corporate ownership and assumes companies are independent economic entities. In Continental Europe this latter assumption does not hold, due to the importance of business groups. Using a sample of mostly non-quoted Belgian medium and large...

Dit artikel stelt dat een governancesysteem noodzakelijkerwijs is gestoeld op zogenaamde “checks and balances”, dwz machtsevenwichten tussen diverse partijen. Gezien dergelijke evenwichten relatief fragiel zijn en kunnen worden verstoord door allerhande maatschappelijke en economische...

CAPWe show that the results of a CAPM test are quite sensitive to the details of the test design. Especially crucial are the aspects related to the weight one gives to small, low-reputation stocks when constructing both the factor portfolios and the test or style portfolios whose returns are to...

Assuming that asset markets are complete and arbitrage-free, the exchange rate can be expressed in terms of observables in a multicountry, multigood general equilibrium economy. In contrast to existing models of the exchange rate, this general model allows for international differences in...

Investors who want to profitably trade stocks which they believe to be undervalued or overvalued are facing not just transaction costs: also cash constraints and short-selling restriction can hinder them. Intuitively, the more onerous friction may seem to be short-selling: borrowing shares from...