Journal article
Open-end organizational structures and limits to arbitrage
- Abstract:
- We provide evidence that open-end organizational structures undermine incentives for asset managers to attack long-term mispricing. We compare open-end funds with closed-end funds. Closed-end funds purchase more underpriced stocks than do open-end funds, especially if the stocks involve high arbitrage risk. We then show that hedge funds with highshare restrictions having a lower degree of open-endedness also trade against long-term mispricing to a larger extentthan do other hedge funds. Our analysis suggests that open-end organizational structures are not conducive to long-term risky arbitrage.
- Publication status:
- Published
- Peer review status:
- Peer reviewed
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Access Document
- Files:
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(Preview, Accepted manuscript, pdf, 464.0KB, Terms of use)
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- Publisher copy:
- 10.1093/rfs/hhx057
Authors
- Publisher:
- Oxford University Press
- Journal:
- Review of Financial Studies More from this journal
- Volume:
- 31
- Issue:
- 2
- Pages:
- 773–810
- Publication date:
- 2017-07-10
- Acceptance date:
- 2017-03-10
- DOI:
- EISSN:
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1465-7368
- ISSN:
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0893-9454
- Keywords:
- Pubs id:
-
pubs:685555
- UUID:
-
uuid:5daaacd5-dd28-4a3a-b459-2218029af8b0
- Local pid:
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pubs:685555
- Source identifiers:
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685555
- Deposit date:
-
2017-03-14
- ARK identifier:
Terms of use
- Copyright holder:
- Giannetti and Kahraman
- Copyright date:
- 2017
- Notes:
- Copyright © 2017 The Authors. Published by Oxford University Press on behalf of The Society for Financial Studies. This is the accepted manuscript version of the article. The final version is available online from Oxford University Press at: https://doi.org/10.1093/rfs/hhx057
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