Prior research argues that one reason firms engage in corporate spinoffs is to increase firm value by reducing information asymmetry with shareholders (the “information hypothesis”). However, the literature has yet to identify a mechanism through which this reduction in information asymmetry...

In this paper, we examine the factor exposures of foreign equity capital in a domestic stock market in order to understand its risk-taking behavior and sources of returns in the market. Using data from Korea for the 1999-2013 period, we find that foreigners are strongly exposed to the...