Hedge funds' extensive use of derivatives, short-selling, and leverage and their dynamic trading strategies create significant non-normalities in their return distributions. Hence, the traditional performance measures fail to provide an accurate characterization of the relative strength of hedge...

Hedge funds' extensive use of derivatives, short-selling, and leverage and their dynamic trading strategies create significant non-normalities in their return distributions. Hence, the traditional performance measures fail to provide an accurate characterization of the relative strength of hedge...

We investigate whether rating conservatism increases with information asymmetry. We argue that high information asymmetry amplifies debtholders’ reliance on ratings for investment and contracting purposes, thus making rating agencies’ loss function more asymmetric and ratings more...