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Detail Katalog

Jurnal

Journal of Financial Economics

Keyword

Hedge funds; Lobbyists; Informed trading; Performance; Information transfer

Pengarang

  1. Meng gao
  2. Jiekun huang

    Subject

    1. ECONOMIC
    2. FINANCIAL

      [Abstrak]



      This paper
      examines the hypothesis that hedge fund managers gain an informational
      advantage in securities trading through their connections with lobbyists. Using
      data sets on the long-equity holdings and lobbyist connections of hedge funds
      from 1999 through 2012, we show that hedge funds outperform passive benchmarks
      by 56–93 basis points per month on their political holdings when they are
      connected to lobbyists. Furthermore, the political outperformance of connected
      funds decreased significantly after the Stop Trading on Congressional Knowledge
      (STOCK) Act became effective. Our study provides evidence on the transmission
      of political information in financial markets and on the value of such
      information to financial market participants.








      Periode

      Vol 121, Nomor 3, Tahun 2016

      [Berkas]

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