Publications

Journal Article

The authors exploit the merger between BlackRock and Barclays Global Investors to study how changes in expected ownership concentration affect the investment behavior of funds and the cross-section of stocks worldwide.

The authors find that funds with open-end structures and large exposure to commonly held stocks begin avoiding these stocks following the merger announcement. This leads to a permanent change in the composition of institutional ownership and a negative price and liquidity impact.

The authors confirm these results in a large sample of global asset management mergers. Their findings suggest that market participants behave strategically in response to changes in expected financial fragility.