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Article
Publication date: 9 January 2017

Thomas Jason Boulton and Terry D. Nixon

The authors study the shareholder wealth effects of the adoption and subsequent litigation confirming the validity of shareholder right plans that are enacted to protect a firm’s…

394

Abstract

Purpose

The authors study the shareholder wealth effects of the adoption and subsequent litigation confirming the validity of shareholder right plans that are enacted to protect a firm’s net operating loss (NOL) carry forwards (tax benefit preservation plans (TBPPs)). The purpose of this paper is to expand the understanding of nontraditional shareholder rights plans, which are becoming increasingly more common.

Design/methodology/approach

This paper considers abnormal returns around TBPP adoptions and Delaware Court rulings that validated their use. The authors study 118 plans adopted between 1998 and 2011. Abnormal returns are measured using both a market model and a performance-matched sample.

Findings

The authors find that abnormal returns are negative at the announcement of a new TBPP. However, the full impact of plan adoption on share prices is not evident until the Delaware Courts validated their use. The Delaware Court rulings in the case of Selectica, Inc. v. Versata Enterprises, Inc. and Trilogy, Inc. are associated with additional negative wealth effects for both prior plan adopters and the firms most likely to consider adopting a plan. These results suggest that entrenchment concerns tend to outweigh the protection of NOL carry forwards when firms adopt TBPPs.

Originality/value

This study was the first to consider the adoption of TBPPs. Currently, it is the only study that considers Delaware Court rulings related to these plans, which allows us to successfully disentangle the entrenchment hypothesis from the potential alternative hypothesis that the negative announcement period returns are driven by investors updating their expectations for firm performance.

Details

Managerial Finance, vol. 43 no. 1
Type: Research Article
ISSN: 0307-4358

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Article
Publication date: 27 June 2020

Thomas Jason Boulton and Marcus V. Braga-Alves

Prior research posits that traders with short-lived information favor lit exchanges over dark pools due to execution certainty. This paper aims to focus on the relation between…

244

Abstract

Purpose

Prior research posits that traders with short-lived information favor lit exchanges over dark pools due to execution certainty. This paper aims to focus on the relation between informed trading based on firm fundamentals and dark pool volume because the preferred venue for traders with longer-lived information is less certain.

Design/methodology/approach

The authors examine the effect of short interest, a proxy for informed traders with long-lived information, on dark pool volume using fixed effects, first difference and instrumental variable approaches. They examine the effect of dark pools on the profitability of long-lived information using market- and characteristic-adjusted returns.

Findings

The proportion of trading volume executed in dark pools is positively correlated with short interest. This result is stronger for stocks that suffer from greater uncertainty and stocks targeted by transient institutional investors. Short sellers profit substantially from their information as subsequent returns are lower for heavily shorted stocks with greater dark pool volume.

Research limitations/implications

In 2014, the Financial Industry Regulatory Authority began making trading data available for dark pools. Before that, only limited information was publicly available. The authors use that data to shed more light on dark pools activity.

Practical implications

The evidence presented in the paper helps inform the current discussion about the role and regulation of dark pools.

Originality/value

This is the first study to show that informed traders with long-lived information favor dark pools due to their opacity and the possibility of price improvement.

Details

Managerial Finance, vol. 46 no. 10
Type: Research Article
ISSN: 0307-4358

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Article
Publication date: 1 February 1974

Tom Schultheiss

The following classified, annotated list of titles is intended to provide reference librarians with a current checklist of new reference books, and is designed to supplement the…

227

Abstract

The following classified, annotated list of titles is intended to provide reference librarians with a current checklist of new reference books, and is designed to supplement the RSR review column, “Recent Reference Books,” by Frances Neel Cheney. “Reference Books in Print” includes all additional books received prior to the inclusion deadline established for this issue. Appearance in this column does not preclude a later review in RSR. Publishers are urged to send a copy of all new reference books directly to RSR as soon as published, for immediate listing in “Reference Books in Print.” Reference books with imprints older than two years will not be included (with the exception of current reprints or older books newly acquired for distribution by another publisher). The column shall also occasionally include library science or other library related publications of other than a reference character.

Details

Reference Services Review, vol. 2 no. 2
Type: Research Article
ISSN: 0090-7324

Available. Content available
Book part
Publication date: 9 March 2022

Piero Formica

Free Access. Free Access

Abstract

Details

Ideators
Type: Book
ISBN: 978-1-80262-830-2

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Book part
Publication date: 3 September 2019

Jeffrey Berman

Abstract

Details

Mad Muse: The Mental Illness Memoir in a Writer's Life and Work
Type: Book
ISBN: 978-1-78973-810-0

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Book part
Publication date: 9 March 2022

Piero Formica

Abstract

Details

Ideators
Type: Book
ISBN: 978-1-80262-830-2

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Book part
Publication date: 9 March 2022

Piero Formica

Abstract

Details

Ideators
Type: Book
ISBN: 978-1-80262-830-2

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