Faff, Robert W.
[Verfasser:in]
;
Parwada, Jerry T.
[Sonstige Person, Familie und Körperschaft];
Tan, Eric K. M.
[Sonstige Person, Familie und Körperschaft]
Did Connected Hedge Funds Benefit From Bank Bailouts During the Financial Crisis?
Anmerkungen:
In: Journal of Banking and Finance, Forthcoming
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments July 26, 2019 erstellt
Beschreibung:
We examine whether connected hedge funds (i.e. those that are prime-brokerage clients of bailout banks) benefited from bailout programs initiated in seven countries during the 2007–2009 financial crisis. We find that being connected to a bailout bank is generally beneficial for hedge funds in that it lowers the rate of fund failure. However, this benefit becomes smaller during the post bailout period, for example, due to the greater risk-taking and higher leverage of such funds subsequent to bailouts. As such, our findings provide support for the moral hazard hypothesis