Investor Heterogeneity, Investor-Management Disagreement and Open Market Share Repurchases

• Main Authors: HUANG, Sheng, Thakor, Anjan
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2010
• Subjects: stock repurchase; corporate payout; agreement; investor heterogeneity; Finance and Financial Management; Portfolio and Security Analysis
• Online Access: https://ink.library.smu.edu.sg/lkcsb_research/3182; https://www.huangjk.info/pdf/Repurchase_06-2010.pdf
• Institution: Singapore Management University

This paper develops a new theoretical explanation for why a firm conducts open-market stock repurchases, tests the main predictions associated with this explanation and finds empirical evidence in support. Investors may disagree with the manager about the firm’s investment projects. A repurchase cau...