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...

We use a proprietary dataset from a large Swiss retail bank to examine the impact of financial advice on individual investors’ stock trading performance and their behavioral biases. Our data allows us to classify each individual trade as either advised or independent and to compare them in a...

We present a new, regression-based methodology for decomposing the risk-adjusted performance of private investors, firms, and mutual funds. Our technique allows for the inclusion of multivariate and continuous subject characteristics in the analysis and it ensures that the statistical results...

This paper investigates the problem of time stamp errors in the IBES database. We show that IBES did not store the original announcement date of both recommendations and forecasts on U.S. stocks until 2001 and even later for other countries. The announcement date in IBES is often effectively the...

We study financial reporting and corporate governance in 218 companies accused of price fixing. These firms engage in evasive financial reporting strategies, including earnings smoothing, segment reclassification, and restatements. In corporate governance, cartel firms favor outside directors...

We study financial reporting and corporate governance in 216 U.S. companies accused of price fixing by antitrust authorities. We document a range of strategies used by these firms when reporting financial results, including frequent earnings smoothing, segment reclassification, and restatements....

This paper investigates whether geographic diversification is value-enhancing or value-destroying in the financial services sector, broadly defined. Our dataset comprises approximately 3579 observations over the period from 1985 to 2004 and covers the entire range of U.S. financial...

This paper investigates whether functional diversification is value-enhancing or value-destroying in the financial services sector, broadly defined. Based on a U.S. dataset comprising approximately 4060 observations covering the period 1985-2004, we report a substantial and persistent...