Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments August 21, 2019 erstellt
Description:
Do exchange-traded funds (ETFs) influence corporate cash holding decisions? Consistent with the reduced managerial learning from the stock market and increased uncertainty due to higher ETFs ownership, we show that firms included in ETFs' baskets have higher cash holdings as a precautionary response. We address endogeneity concerns through instrumental variable, dynamic generalized methods of moments, and propensity score matching methods. We identify changes in revenues, external financing, share repurchases, and net working capital as potential channels through which cash holdings increase due to higher ETFs ownership. This increase in cash holdings is associated with a positive impact on firm value