What happens when index funds run Corporate America? Hedge fund activist Bill Ackman posed that question recently in his fund’s annual letter to investors. It’s a really good one. No one knows what consequences the boom of passive investment funds will have for the corporations they own. It’s something my coauthors and I explore in […]
While last year set a record for the amount of money spent on corporate mergers — $4.7 trillion — this year is so far setting a very different record: the dollar amount of deals that have come undone. Since the beginning of January, $400 billion worth of corporate mergers have been withdrawn in the United […]
According to Lipper, stock funds that are based in the U.S. saw the biggest weekly outflow since early January in the week ending May 4. Dismal corporate earnings were blamed. However, funds that are deemed safer than their stock counterparts attracted significant investor attention during the same timeframe. Investment-grade bond and Treasury funds saw healthy […]
The rise of activist hedge funds in the last few years has American companies looking over their shoulders to see if an investor boogie man is following somewhere close behind. It’s scary, but here’s the thing - American companies brought it on themselves. Looking back, it made sense that companies were afraid to use their […]
According to reporting by Bloomberg, bearish bets by hedge funds have reached their highest level of the year. After being squeezed on their shorts over the past four years as equities rallied, a potential crash this time could prove more profitable for hedge funds as “growth prospects are lower and valuations are higher.” The price-earnings ratio for […]