Thought Leadership

OUR VALUE COMES FROM AN ANALYTICAL UNDERSTANDING OF THE FORCES AT WORK IN FINANCIAL MARKETS

Apr 30

Six variables that predict defaults

We discuss which variables can help us predict corporate defaults The current pandemic is triggering a stark growth in corporate...

Mar 1

Is it worth investing in distressed stocks?

We investigate whether investing in stocks that are close to default generates a premium Hundreds of firms are going bust these days....

Feb 2

Do firms with higher leverage deliver higher returns?

We review a classic question on the relation between financial risk and equity returns, and discover that the evidence defies the theory...

Feb 2

What is the relation between asset risk and leverage?

We discuss how financial risk and asset risk are co-determined, and how this is reflected in the beta of assets and in the beta of equity...

Jan 14

Do firms have target leverage ratios?

We examine whether firms pursue an optimum leverage ratio, what factors affect optimum leverage, and how fast firms converge towards the...

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