Halle Institute for Economic Research
Between Energy Crisis and AI Boom The summer forecast of the Halle Institute for Economic Research (IWH) assumes that the Gulf conflict eases and energy prices do not rise…
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IWH Subsidy Database
IWH Subsidy Databse The microdatabase currently comprises nine data sets on direct business subsidy programmes in Germany. The programme statistics kept by the project sponsors…
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IWH-CompNet 5th FINPRO
IWH-CompNet 5th Finance and Productivity Conference 24-25 April, 2026 - Tokyo, Japan The IWH-CompNet 5th Finance and Productivity Conference (FINPRO5), held on 24–25 April 2026 at…
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Alumni
Alumni IWH provides guidance and support in job placement after graduation, including letters of recommendation and career advice. Graduates have found placements in academia…
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Research Clusters
Three Research Clusters Each IWH research group is assigned to a topic-oriented research cluster. The clusters are not separate organisational units, but rather bundle the…
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Research Articles
Research Articles Explore cutting-edge research based on CompNet’s micro-aggregated firm-level data and related analytical tools. These articles cover empirical and theoretical…
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Archive
Media Response Archive 2021 2020 2019 2018 2017 2016 December 2021 IWH: Ausblick auf Wirtschaftsjahr 2022 in Sachsen mit Bezug auf IWH-Prognose zu Ostdeutschland: "Warum Sachsens…
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Monetary Policy
Monetary policy How firms respond to sudden changes in profitability affects the process of job creation, job destruction, aggregate investment and how fast resources are…
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Firm Responsiveness
Firm responsiveness How firms respond to sudden changes in profitability affects the process of job creation, job destruction, aggregate investment and how fast resources are…
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The Corporate Investment Benefits of Mutual Fund Dual Holdings
Rex Wang Renjie, Patrick Verwijmeren, Shuo Xia
Journal of Financial and Quantitative Analysis,
Vol. 60 (2),
2025
Abstract
Mutual fund families increasingly hold bonds and stocks from the same firm. We present evidence that dual ownership allows firms to increase valuable investments and refinance by issuing bonds with lower yields and fewer restrictive covenants, especially when firms face financial distress. Dual holders also prevent overinvestment by firms with entrenched managers. Overall, our results suggest that mutual fund families internalize the agency conflicts of their portfolio companies, highlighting the positive governance externalities of intra-family cooperation.
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