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Do corporate site visits impact hedge fund performance?

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Listed:
  • Hong, Xin
  • Zhuang, Zhuang
  • Kang, Di
  • Wang, Zhibin

Abstract

Nearly one in six hedge funds conducted corporate site visits from 2012 to 2017. Using comprehensive hedge fund site visit data, this paper is one of the first to empirically examine how corporate site visits affect fund performance. We find that hedge funds with more corporate site visits have better performance. The relation is stronger when a hedge fund manager visits a neglected firm or asks more questions during the visit, suggesting that hedge funds may be able to gain information advantage through site visits. Site visits benefit hedge funds more when a hedge fund manager conducts a site visit with a mutual fund manager. Further, the margin trading of the visited company's stock increases following a hedge fund site visit.

Suggested Citation

  • Hong, Xin & Zhuang, Zhuang & Kang, Di & Wang, Zhibin, 2019. "Do corporate site visits impact hedge fund performance?," Pacific-Basin Finance Journal, Elsevier, vol. 56(C), pages 113-128.
    • Handle: RePEc:eee:pacfin:v:56:y:2019:i:c:p:113-128
    DOI: 10.1016/j.pacfin.2019.06.002
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    References listed on IDEAS

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    More about this item

    Keywords

    Hedge funds; Corporate site visit; Information advantage;
    All these keywords.

    JEL classification:

    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors

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