There have been acquisitions during many activist hedge fund attacks on a corporate target that the “books were being cooked” and the real story was not being told. Now academics Inder Khurana from the University of Missouri, Yinghua Li at Arizona State and Wei Wang at Temple University provide statistical analysis to back up this claim. Their research studying 510 activist events from 2001 to 2013 leads them to conclude that corporate managers engage in very different disclosure and reporting tactics when they are a target of activist hedge funds. The study found that a corporation’s “bad news withholding” increases…
Management Suppresses Bad News When Challenged by Activists [STUDY]
Mark Melin
Mark Melin is an alternative investment practitioner whose specialty is recognizing the impact of beta market environment on a technical trading strategy. A portfolio and industry consultant, wrote or edited three books including High Performance Managed Futures (Wiley 2010) and The Chicago Board of Trade’s Handbook of Futures and Options (McGraw-Hill 2008) and taught a course at Northwestern University's executive education program.