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Corporate aging and changes in the pricing of stock characteristics

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  • Bank, Matthias
  • Insam, Franz

Abstract

This study reveals that the pricing of several prominent stock and firm characteristics changes as firms age, based on a sample of common stocks in the US. It contributes to the literature by showing that interactions between stock characteristics, particularly firm age, are pricing relevant for the cross-section of stock returns. This finding emerges from a robust multivariate panel regression approach, which helps to address the multivariate challenge in cross-sectional asset pricing and controls for firm-fixed effects.

Suggested Citation

  • Bank, Matthias & Insam, Franz, 2021. "Corporate aging and changes in the pricing of stock characteristics," Finance Research Letters, Elsevier, vol. 42(C).
    • Handle: RePEc:eee:finlet:v:42:y:2021:i:c:s1544612320317220
    DOI: 10.1016/j.frl.2020.101908
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    More about this item

    Keywords

    Asset pricing; Characteristics; Corporate aging; Corporate life-cycle;
    All these keywords.

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates

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