Using a unique empirical approach that accounts for the possibility that financial market crashes are endogenously determined by market structures, this study examines how economic freedom contribute to crashes in financial markets. On one hand, economic freedom might provide an unregulated...

Despite assumptions of mean-variance efficiency that underlie most asset pricing models, investors have shown a penchant for positive skewness. This study documents that the ratio of call option volume relative to total option volume is greatest for stocks with return distributions that resemble...

Prior research argues that religiosity increases the ethical behavior and levels of risk aversion of firm managers. To the extent that this is true, more religious countries might exhibit more stability in stock prices. This study tests this assertion by determining whether religiosity in...

This paper investigates the linkage between macroeconomic factors and the price stability of individual securities in a unique setting. Using a large sample of 327 American Depositary Receipts (ADRs), we test whether economic freedom in the ADR home country reduces the level of ADR volatility....

Economic theory suggests that speculative trading can lead to instability in financial markets. Using a novel dataset on retail trading activity in the US, this study extends the literature and investigates the impact of retail (speculative) trading on the volatility of the financial markets...