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Hedge Fund Ownership and Voluntary Disclosure by Bok Baik; Jin-Mo Kim; Kyonghee Kim; Sukesh Patro is a Business, Management and Accounting article available to read on EtoBox.

What is Hedge Fund Ownership and Voluntary Disclosure about?

Using 13F filings from 1996 to 2011, we document that hedge fund holdings are negatively associated with the subsequent frequency of portfolio firms' voluntary disclosure. This is opposite to the positive association documented in earlier studies for overall institutional ownership as well as for non-hedge fund ownership in our sample. The negative association is more pronounced for hedge fund ownership with short-term investment horizons. Tests using measures of hedge fund influence suggest that hedge fund ownership impacts voluntary disclosure as opposed to hedge funds selecting stocks with subsequent declines in disclosure. We also find that the stocks that decrease their voluntary disclosure subsequent to increases in hedge fund holdings earn positive abnormal returns. Overall, our findings suggest that the impact of hedge funds on firm voluntary disclosure policy differs from that of other institutional investors and potentially contributes to hedge fund profitability.

Who reads Hedge Fund Ownership and Voluntary Disclosure?

Author

Bok Baik; Jin-Mo Kim; Kyonghee Kim; Sukesh Patro

Publisher

Springer US; Springer-Verlag; Springer New York LLC; Springer Science and Business Media LLC; Society for Mining, Metallurgy and Exploration Inc. (ISSN 0924-865X)

Published

2019

Language

EN

Field

Business, Management and Accounting (Social Sciences)