Stock performance and CEO house size study
The BusinessWeek article “The CEO Mega-Mansion Factor” (April 2, 2007) definitely caught my attention — Two finance professors (Liu and Yermack) collected data on house sizes of CEOs of the S&P 500 companies in 2004. Their theory is “If home purchases represent a signal of commitment by the CEO, subsequent stock performance of the company should at least remain unchanged and possibly improve. Conversely, if home purchases represent a signal of entrenchment, we would expect stock performance to decline after the time of purchase.” The article summarizes the results: “[they] found that 12% of [CEOs] lived in homes of at … Continue reading Stock performance and CEO house size study