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Author : Ivan Kühne
Publisher : Haupt Verlag AG
ISBN 13 : 3258076944
Total Pages : 350 pages
Book Rating : 4.2/5 (58 download)
Download or read book Activist Vs. Passivist Hedge Funds written by Ivan Kühne and published by Haupt Verlag AG. This book was released on 2011 with total page 350 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Alon Brav
Publisher : Now Publishers Inc
ISBN 13 : 1601983387
Total Pages : 76 pages
Book Rating : 4.6/5 (19 download)
Download or read book Hedge Fund Activism written by Alon Brav and published by Now Publishers Inc. This book was released on 2010 with total page 76 pages. Available in PDF, EPUB and Kindle. Book excerpt: Hedge Fund Activism begins with a brief outline of the research literature and describes datasets on hedge fund activism.
Author : William Bratton
Publisher : OUP Oxford
ISBN 13 : 0191039799
Total Pages : 924 pages
Book Rating : 4.1/5 (91 download)
Download or read book Institutional Investor Activism written by William Bratton and published by OUP Oxford. This book was released on 2015-08-20 with total page 924 pages. Available in PDF, EPUB and Kindle. Book excerpt: The past two decades has witnessed unprecedented changes in the corporate governance landscape in Europe, the US and Asia. Across many countries, activist investors have pursued engagements with management of target companies. More recently, the role of the hostile activist shareholder has been taken up by a set of hedge funds. Hedge fund activism is characterized by mergers and corporate restructuring, replacement of management and board members, proxy voting, and lobbying of management. These investors target and research companies, take large positions in `their stock, criticize their business plans and governance practices, and confront their managers, demanding action enhancing shareholder value. This book analyses the impact of activists on the companies that they invest, the effects on shareholders and on activists funds themselves. Chapters examine such topic as investors' strategic approaches, the financial returns they produce, and the regulatory frameworks within which they operate. The chapters also provide historical context, both of activist investment and institutional shareholder passivity. The volume facilitates a comparison between the US and the EU, juxtaposing not only regulatory patterns but investment styles.
Author : Ronald D. Orol
Publisher : John Wiley & Sons
ISBN 13 : 0470198915
Total Pages : 400 pages
Book Rating : 4.4/5 (71 download)
Download or read book Extreme Value Hedging written by Ronald D. Orol and published by John Wiley & Sons. This book was released on 2008-01-18 with total page 400 pages. Available in PDF, EPUB and Kindle. Book excerpt: Activist hedge fund managers represent a small part of the $1.5 trillion hedge fund industry, but their approach is causing a stir among traditional managers and the investment community because they are shaking up the corporate establishment and making money for their investors. These types of managers are here to stay and Extreme Value Hedging tells the story of their rise to power in the U.S. and how they are spreading their influential gospel around the globe to places like China, Ukraine, South Korea and Sweden. Author Ronald D. Orol has a unique understanding of this world and through this book he shares his unparalleled insights in an easy to comprehend manner. He discusses everything from activist investor efforts to breakup the clubby insider world of corporate boardrooms to their deal-making or breaking pressure tactics and courtroom battles. Orol skillfully makes his case for each subject by offering revelations and examples from insiders like Ralph Whitworth, (Relational Investors), Guy Wyser-Pratte, (Wyser-Pratte Management), Mark Schwarz, (Newcastle Capital Group LLC), Robert Chapman (Chapman Capital), Phillip Goldstein (Opportunity Partners), Jeffrey Ubben (ValueAct Capital), Jeffrey M. Solomon (Ramius Capital Group LLC), Michael Van Biema (Van Biema Value Partners), Eric Rosenfeld (Crescendo Partners), Lars Förberg (Cevian Capital) and Emanuel Pearlman (Liberation Investment Group), among many, many others.
Author : Yvan Allaire
Publisher :
ISBN 13 :
Total Pages : 18 pages
Book Rating : 4.:/5 (932 download)
Download or read book The Case for and Against Activist Hedge Funds written by Yvan Allaire and published by . This book was released on 2015 with total page 18 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Yvan Allaire
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (13 download)
Download or read book The Game of 'activist' Hedge Funds written by Yvan Allaire and published by . This book was released on 2015 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Cathleen M. Rittereiser
Publisher : John Wiley & Sons
ISBN 13 : 0470637145
Total Pages : 245 pages
Book Rating : 4.4/5 (76 download)
Download or read book Top Hedge Fund Investors written by Cathleen M. Rittereiser and published by John Wiley & Sons. This book was released on 2010-06-03 with total page 245 pages. Available in PDF, EPUB and Kindle. Book excerpt: A professional's guide to the world of hedge fund investing Throughout the financial crisis of 2008, many hedge funds suffered massive losses and were often blamed for the extreme market upheavals. In the wake f the crisis, hedge funds remain a source of fascination for the media, legislators, and investors, mostly due to misunderstanding. Historically portrayed as risky investment funds for the very wealthy run by swashbuckling traders, the truth is hedge funds are simply an investment vehicle designed to generate superior returns and reduce an investor's overall portfolio risk. Investors have good reasons to remain fascinated with hedge funds. Although many individual funds have underperformed or collapsed, hedge funds as a whole have provided solid returns while reducing risks. Savvy institutions have invested in hedge funds for many years and have made them a large and powerful force in the markets. Investing in hedge funds requires sophisticated knowledge, understanding, skill, access, and experience. Individuals and institutions, whether they are new to hedge funds or need to improve, can find those attributes in the stories of the successful hedge fund investors profiled in Hedge Fund Investors. Hedge Fund Investors chronicles the challenges and rewards these investors face, in selecting hedge fund managers, managing risks, and constructing portfolios. In revealing conversations, leading hedge fund investors who place hundreds of billions of dollars in hedge funds, share their philosophies, strategies, and advice. Profiles a variety of different investors from the pioneers in hedge fund investing to managers for high net-worth individuals and fund of funds investors Discusses winners and losers in the recent market decline, problematic hedge fund strategies, and how these current events will change future strategies Provides lessons, insights, and advice beneficial to all hedge fund investors Engaging and informative, Hedge Fund Investors will prove valuable to anyone involved in placing money with hedge funds, as well as hedge funds who seek to better understand their clients.
Author : Andrew Glen Carrothers
Publisher :
ISBN 13 :
Total Pages : 50 pages
Book Rating : 4.:/5 (13 download)
Download or read book Friends Or Foes? Activist Hedge Funds and Other Institutional Investors written by Andrew Glen Carrothers and published by . This book was released on 2017 with total page 50 pages. Available in PDF, EPUB and Kindle. Book excerpt: Hedge funds are more likely to target firms with high levels of institutional ownership and demonstrate a preference for short-term focused institutional investors. Hedge fund activism generates short run and long run abnormal returns without increasing stock return volatility. Regardless of investment horizon, volatility is inversely related to prior period institutional ownership. The trading behavior of institutional owners with different investment horizons is consistent with hedge fund activism creating value. These findings hold regardless of whether investment horizon is based on portfolio churn rate or type of institution. Overall, the results suggest a mutually beneficial relationship between activist hedge funds and other institutional investors.
Author :
Publisher :
ISBN 13 : 9780823709373
Total Pages : 10 pages
Book Rating : 4.7/5 (93 download)
Download or read book Hedge Fund Activism written by and published by . This book was released on 2008 with total page 10 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Nicolo Colombo
Publisher :
ISBN 13 :
Total Pages : 39 pages
Book Rating : 4.:/5 (13 download)
Download or read book Hedge Fund Activism written by Nicolo Colombo and published by . This book was released on 2015 with total page 39 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper combines both theoretical evidence on hedge fund activism and empirical results obtained through an event study around the commencement of activism to show that the phenomenon is value-enhancing for shareholders. In particular, after defining what this form of arbitrage is, it is argued that hedge funds are best suited to engage in activism thanks to reduced conflict of interests, greater incentives to monitor, their size and less legal hurdles. Stock market reaction to announcement of activism is positive, as documented by a dataset of events from 2005 to 2008 that revealed a mean cumulative abnormal return of 4.38% on companies' stock around the filing of Schedule 13Ds. Further analysis investigated activists' stated goals, tactics adopted and whether the type of engagement was collaborative or hostile with existing management. Cross-sectional event study analysis by nature of approach resulted in higher abnormal returns in case of a hostile activist agenda.
Author : Christopher P. Clifford
Publisher :
ISBN 13 :
Total Pages : 42 pages
Book Rating : 4.:/5 (129 download)
Download or read book Value Creation or Destruction? Hedge Funds as Shareholder Activists written by Christopher P. Clifford and published by . This book was released on 2012 with total page 42 pages. Available in PDF, EPUB and Kindle. Book excerpt: I examine the effects of shareholder activism by hedge funds from 1998-2005. When hedge funds accumulate more than 5% of a firm, they must file a regulatory disclosure with the SEC that indicates whether their investment intentions are active or passive. Firms which are targeted by hedge funds for active purposes earn larger excess stock returns and improvements in operating performance (ROA) than a control group of firms that are targeted by the same hedge funds for passive purposes. These operational improvements appear to be driven by the divestiture of underperforming assets. I examine the organizational structure of the hedge funds and find that funds engaging in activism are more likely to have longer lock-ups and withdrawal notification periods than their non-activist peers; indicating that liquidity concerns may be an important determinant in the efficacy of activism. Finally, I document that the returns to the hedge fund are larger for their active blocks than their passive blocks, indicating that activist shareholders may use higher returns to mitigate the cost of their monitoring effort.
Author : Helizander de Oliveira Brecailo
Publisher :
ISBN 13 :
Total Pages : 52 pages
Book Rating : 4.:/5 (294 download)
Download or read book Activist Hedge Funds written by Helizander de Oliveira Brecailo and published by . This book was released on 2008 with total page 52 pages. Available in PDF, EPUB and Kindle. Book excerpt: Hedge funds have played a significant role in shareholder activism in the U.S. They have appeared quite frequently in the media as the driving force behind changes in firms' management that generate higher returns on their investments. Nonetheless, many wonder whether they really bring long-term value and benefits to firms, stakeholders, or financial markets, or whether hedge funds net returns for their investments only. The purpose of this thesis, which is written as a case study based solely on public information, is to discuss the attributes of activist hedge funds and how they differ from corporate raiders and private equity firms. The case study then maps activists' most common mechanisms for accomplishing their goals. Finally, the restaurant industry-in particular, Wendy's International Inc., which has been highly targeted by activists-offers a platform for studying the outcomes of activists' maneuvers.
Author : Kobi Kastiel
Publisher :
ISBN 13 :
Total Pages : 72 pages
Book Rating : 4.:/5 (13 download)
Download or read book Against All Odds written by Kobi Kastiel and published by . This book was released on 2016 with total page 72 pages. Available in PDF, EPUB and Kindle. Book excerpt: The importance of shareholder activism in widely held public companies is already broadly recognized. Less well understood, however, is the role that activist hedge funds play in public companies with a controlling shareholder, and the common view has been that dispersed stock ownership is typically a precondition for activist intervention. To fill this gap, this Article presents the first comprehensive account of hedge fund activism in controlled companies in the United States. Using empirical data and illustrative examples from recent years, the Article finds a surprising number of activist engagements with controlled companies, and unveils the variety of channels through which activism is deployed as well as the limitations of these channels. It concludes by offering regulators and institutional investors some suggestions for further empowering activists in controlled companies, such as granting investors unaffiliated with the controllers the right to elect minority directors.
Author : Marco Elia
Publisher :
ISBN 13 :
Total Pages : 104 pages
Book Rating : 4.:/5 (17 download)
Download or read book Three Essays in Hedge Fund Activism written by Marco Elia and published by . This book was released on 2018 with total page 104 pages. Available in PDF, EPUB and Kindle. Book excerpt: In the first essay, I apply behavioral finance theories to hypothesize one reason why hedge funds choose to engage in activism. Specifically, I predict that if hedge funds see the purchase price of their passive positions as a reference point, then, when they are suffering absolute losses, they are more likely to switch and become activists. I find results consistent with my prediction, even after controlling for the underperformance of the target firms. This study presents new evidence about what causes hedge fund activism. The behavioral finance literature has documented that retail investors, professional traders, and mutual funds are reluctant to realize their losses. I contribute to this literature by showing that a further effect of the loss is to cause activism. The second essay (with Naveen D. Daniel) examines the short-term incentives that activists are facing. The average announcement return to hedge fund activism is around 5%. Thus, activists that want to inflate their reported returns have incentives to initiate activism in target firms before the end of the reporting period. Our contribution is to document that activists engage in such opportunistic activism. Consistent with this, we find that activists are more likely to start their campaigns just before the end of the quarter. This heightened activity cannot be explained by increased news flow at the end of the quarter. In contrast to the typical positive market reaction to activist initiation, reaction to opportunistic activism is virtually zero. This is suggestive of activists initiating campaigns without completing their research on firms, which were potentially targeted for activism in the following quarter. The final essay (with Naveen D. Daniel) investigates how activists are able to be successful despite typically owning a stake of 6-7% in the target firms. We hypothesize that activists have incentives to (implicitly) coordinate with other institutional shareholders and to use this collective firepower to force target firms to change. Our contribution is to document that such coordination is pervasive and is mutually beneficial. In nearly two-thirds of the campaigns, there is coordination between the activist and institutional investors. Coordination is more likely in large firms where the activists would not have sufficient capital to build a large stake. Activist hedge funds that coordinate with other institutional shareholders are more successful in their activism as reflected in higher abnormal returns over the duration of the campaign. We attribute causation by instrumenting for coordination with the geographic proximity between the activist and the institutional investors.
Author : Zazy Khan
Publisher :
ISBN 13 :
Total Pages : 71 pages
Book Rating : 4.:/5 (13 download)
Download or read book Activist Hedge Funds written by Zazy Khan and published by . This book was released on 2017 with total page 71 pages. Available in PDF, EPUB and Kindle. Book excerpt: This study extends the empirical evidence of the impact of hedge fund activism on the targeted firm performance. I investigate whether activism strategies, as well as their effects, have changed following the recent financial crisis of 2007-2008. Using a sample based on the U.S. data covering 112 activist hedge funds targeting 551 publicly listed firms from 2000 to 2013, I find that returns to activism accrue approximately 5% during the (-20, 5) event window. Activism-related categories that generate significant and positive abnormal returns include capital structure, business strategy, and general undervaluation. Since the financial crisis, business-related activism generates the highest returns, followed by the activism in the financially depressed firms. I also find significant cross-sectional abnormal returns, both before and during the crisis, for hedge funds who do not pre-specify an objective. The long term post-activism performance suggests that targeted firms experience substantial improvement in value, profit margin, and investment.
Author : John Morley
Publisher :
ISBN 13 :
Total Pages : 48 pages
Book Rating : 4.:/5 (13 download)
Download or read book Too Big to Be Activist written by John Morley and published by . This book was released on 2019 with total page 48 pages. Available in PDF, EPUB and Kindle. Book excerpt: Big investment managers, such as Vanguard and Fidelity, have accumulated an astonishing amount of common stock in America's public companies--so much that they now have enough corporate votes to control entire industries. What will these big managers do with their potential power?This Article argues that they will do less than we might think. And the reason is paradoxical: the biggest managers are too big to be activists. Their great size creates intense internal conflicts of interest that make aggressive activism extremely difficult or even impossible.The largest managers operate hundreds of different investment funds, including mutual funds, hedge funds, and other vehicles that all invest in the same companies at the same times. This structure inhibits activism, because it turns activism into a source of internal conflict. Activism by one of a manager's funds can damage the interests of the manager's other funds. If a BlackRock hedge fund invests in a company's equity at the same time a BlackRock mutual fund invests in the company's debt, then any attempt by either fund to turn the company in its favor will harm the interests of the other fund. The hedge fund and mutual fund might similarly come into conflict over the political and branding risks of activism and the allocation of costs and profits. Federal securities regulation and poison pills can create even more conflicts, often turning activism by a hedge fund into serious legal problems for its manager's entirely passive mutual funds. A big manager, in other words, is like a lawyer with many clients: its advocacy for one client can harm the interests of another.The debate about horizontal shareholding and index fund activism has ignored this truth. Research on horizontal ownership tends to treat a manager and its funds as though they were a single unit with no differences among them. The debate over index fund activism goes the opposite direction, often treating a mutual fund as though it were completely isolated from the other funds that share the same management. By introducing a subtler understanding of big managers' structures, we can understand shareholder activism more clearly. Among other things, I show why aggressive activism tends to come entirely from small managers--that is, from the managers whose potential for activism is actually the weakest. It's because these managers' small size avoids internal conflict.
Author : Mark Mietzner
Publisher :
ISBN 13 :
Total Pages : 47 pages
Book Rating : 4.:/5 (129 download)
Download or read book Hedge Funds versus Private Equity Funds as Shareholder Activists - Differences in Value Creation written by Mark Mietzner and published by . This book was released on 2008 with total page 47 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper analyzes market reactions triggered by announcements that hedge funds and private equity investors have purchased large blocks of voting rights. We argue that changes in shareholder wealth are related to the opportunity, possibility, and motivation of being an active blockholder who successfully reduces agency problems. We find positive abnormal returns following an announcement that an active shareholder has acquired at least 5% of a company's voting rights. Proxy variables for agency costs explain the market reaction only for investments of private equity funds. Considering the long-term stock price performance, we observe negative buy-and-hold abnormal returns especially for the hedge fund samples. We argue that this is because of the German corporate governance system, whereby hedge funds must align their interests with advisory board members. Therefore, we believe the distinct negative post-announcement stock performance of hedge fund targets may be a misinterpretation by the capital market of a hedge fund's abilities and motivations. It seems market participants do not believe hedge fund activism creates wealth effects in a manner comparable to private equity engagements.
