Publications
Publications
Journal of Financial Economics, 175, 104192, January 2026.
with Matteo Crosignani, Marco Macchiavelli, and Andr´e F. Silva
Abstract: To safeguard its technological leadership, the U.S. has restricted domestic suppliers from exporting cutting-edge technologies to selected Chinese firms. Domestic firms affected by these export controls halt sales to Chinese customers, as intended, but struggle to establish new relations with alternative customers domestically or in politically aligned regions. Consequently, domestic suppliers experience sizable losses in market capitalization, along with reductions in profitability, employment, and bank lending. Chinese firms are more proactive in reconfiguring supply chains, though not without costs. Overall, export controls impose larger costs on U.S. firms developing the very technologies these policies aim to protect.
Media Coverage: The Liberty Street, Financial Times, New York Times, Bloomberg, CNN, Barron's, CSIS, CFR , Marginal Revolution
The Review of Financial Studies, Forthcoming
with Xing Huang, Ohad Kadan, and Jimmy Wu
Abstract: We examine the role of race and ethnicity in the mutual fund context at two distinct levels. At the fund manager level, we document a co-racial tilt---funds managed by minority-dominant (White-dominant) teams allocate larger portfolio weights to minority-led (White-led) firms. This tilt is not associated with superior performance. It diminishes as fund managers gain experience, suggesting the presence of inaccurate statistical discrimination. At the investor level, we find that minority-led funds are penalized similarly to White-dominant funds for poor performance, but are not rewarded as much for superior performance. Overall, our results uncover race-related investment choices at both levels.
Working Papers
2025 Kroner Center for Financial Research Grant
with Matteo Crosignani, and Marco Macchiavelli
Abstract: How do investors perceive and navigate the emerging geoeconomic risk? We identify firm-level geoeconomic risk using supply-chain links to Chinese firms targeted by U.S. export controls. Affected U.S. suppliers experience negative abnormal returns around policy announcements. These shocks propagate to mutual funds through portfolio holdings, raising volatility and lowering performance. Fund managers respond by reducing exposure to China-linked exporters, increasing portfolio concentration, and buying more lottery-like stocks. A long–short portfolio based on geoeconomic risk exposure earns positive and significant future returns, suggesting investors demand compensation for bearing the high geoeconomic risk.
with Stacey E. Jacobsen, Jayoung Nam and Veronika Krepely Pool
Abstract: We examine cross trading by mutual funds in corporate bonds. We find that cross trading is relatively common in the 2009 to 2022 period, with substantial variation across fund families and greater activity for illiquid and hard-to-obtain bonds. Cross trading is particularly elevated around maturity cutoffs, credit rating changes, and periods of extreme fund flows, suggesting that it can be beneficial in times of pressure. High-fee funds tend to cross with lower-fee funds, but we find no evidence that crossing transfers performance from low- to high-value funds. We document large transaction cost savings, although these savings have diminished following a regulatory change that significantly limits cross trading.
Solo-authored
Abstract: This paper documents that mutual fund managers who experience distress in one fund take on more risk in the other funds they manage. Specifically, these managers rebalance their linked-fund portfolios toward higher systematic and idiosyncratic risk and hold more lottery-like stocks. The response is more pronounced among managers with performance-based contracts and attenuates when compensation includes deferrable pay with longer vesting periods. Managers’ career concerns also play a role in shaping cross fund risk-taking behavior. Overall, the findings highlight spillover effects across funds through common managers and underscore agency conflicts in the mutual fund industry.
with Xuan Luo and Shumiao Ouyang
Abstract: This paper examines how individual investors respond to the market price fluctuations, using unique individual-level transaction data from a trading experiment and the same individuals' real trading history on the Alipay app. We find that, in response to exogenous price movements in the experiment, investors tend to be contrarian traders. Sophisticated investors tend to be more contrarian than the less sophisticated ones. We further document that investors' real trading styles can be highly predicted with their behaviors in the experiment. The results imply that investors use simple heuristics from the price movements when they make investment decisions in the real world.