Discussion Papers

We survey a large representative sample of retail investors in China to elicit their memories of stock market investment and return expectations. We...

We build a model of the law of small numbers (LSN)—the incorrect belief that even small samples represent the properties of the underlying population...

We consider a setting in which privately informed agents are located in a network and trade a risky asset with other agents with whom they are...

We propose a novel way to estimate a portfolio’s abnormal price, the percentage gap between price and the present value of dividends computed with a...

We study exchange rate expectations in surveys of financial professionals and find that they successfully forecast currency appreciation at the two...

The existing literature has documented “reaching for yield” - the phenomenon of investing more in risky assets when interest rates drop - among...

We develop a dynamic model of DeFi lending that incorporates the following key features: 1) borrowing and lending are decentralized, anonymous...

We survey thousands of affluent American investors to examine the relationship between personalities and investment decisions. The Big Five...

We develop a two-country model in which currency and bond markets are populated by different investor clienteles, and segmentation is partly overcome...

We study how passive investing affects asset prices. Flows into passive funds raise disproportionately the stock prices of the economy’s largest firms...

Will asset managers with large amounts of capital and high risk-bearing capacity hold large blocks and monitor aggressively? Both block size and...

We study bank capital requirements as a tool to address financial risks and externalities caused by carbon emissions. Capital regulation can...

We study dynamic portfolio choice in a calibrated equilibrium model where value and momentum anomalies arise because capital slowly moves from under-...

We ask why we observe multiple layers of decision-making in fund management with investors, sponsors, fund managers, and consultants, even if...

We show that supply-side effects arising from the bond holdings of open-end mutual funds affect corporate credit risk. In our model, funds exposed to...

Borrowers obtain liquidity by issuing securities backed by current period payoff and resale price of a long-lived collateral asset. They are privately...