Market efficiency and limits to arbitrage: Evidence from the Volkswagen short squeeze
| Autor: | Franklin Allen, Angel Tengulov, Marlene Haas, Eric Nowak |
|---|---|
| Rok vydání: | 2021 |
| Předmět: |
Economics and Econometrics
Insolvency INFORMATION Economics Strategy and Management Social Sciences German Disclosure and securities regulation ASK Business & Economics Accounting 0502 economics and business 1402 Applied Economics Limits to arbitrage FUTURES Stock (geology) 040101 forestry Finance 050208 finance business.industry 05 social sciences 1502 Banking Finance and Investment Market efficiency 04 agricultural and veterinary sciences Listed company Business Finance Stock cornering language.human_language Short squeeze 1606 Political Science Short selling STOCK-PRICE MANIPULATION VOLUME language 0401 agriculture forestry and fisheries Business Capital market BEHAVIOR TRADING COSTS |
| Zdroj: | Journal of Financial Economics. 142:166-194 |
| ISSN: | 0304-405X |
| Popis: | On October 26, 2008, Porsche announced a largely unexpected domination plan for Volkswagen. The resulting short squeeze in Volkswagen’s stock briefly made it the most valuable listed company in the world. We argue that this was a manipulation designed to save Porsche from insolvency and the German laws against this kind of abuse were not effectively enforced. Using hand-collected data we provide the first rigorous academic study of the Porsche-VW squeeze and show that it significantly impeded market efficiency. Preventing manipulation is important because without efficient securities markets, the EU’s major project of the Capital Markets Union cannot be successful. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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