Journal article
Institutional trading around MA announcements
Financial management, v 53(4), pp 643-680
22 Dec 2024
Abstract
We contrast the investment strategies of hedge funds and mutual funds around mergers and acquisitions (M&A). We find that hedge funds, on average, increase their holdings of soon-to-be takeover targets by 7.5% during the quarter before M&A announcements. Conversely, mutual funds, on average, reduce their equity holdings in impending targets by 3.0% over the same time period. The reduction in M&A holdings by mutual funds is less pronounced for more actively managed funds. Our results suggest that hedge funds enjoy superior access to private information or possess superior ability to process public information related to M&A transactions.
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Details
- Title
- Institutional trading around MA announcements
- Creators
- Eliezer M. Fich - Drexel UniversityViktoriya Lantushenko - Saint Joseph's UniversityClemens Sialm (Corresponding Author) - The University of Texas at Austin
- Publication Details
- Financial management, v 53(4), pp 643-680
- Publisher
- Wiley
- Number of pages
- 38
- Resource Type
- Journal article
- Language
- English
- Academic Unit
- Finance
- Web of Science ID
- WOS:001304187900001
- Scopus ID
- 2-s2.0-85203055929
- Other Identifier
- 991022202119804721