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arXiv · 2411.16553

Do Activists Align with Larger Mutual Funds?

Manish Jha
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Abstract

This paper demonstrates that hedge funds tend to design their activist campaigns to align with the preferences and ideologies of institutions holding large stakes in the target company. I estimate these preferences by analyzing the institutions' previous proxy voting behavior. The results reveal that activists benefit from this approach. Campaigns with a stronger positive correlation between the preferences of larger institutions and activist communications attract more shareholder attention, receive more votes, and are more likely to succeed.

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Manish Jha. 2024-11-25. Do Activists Align with Larger Mutual Funds?. https://doi.org/10.1016/j.jbankfin.2025.107402

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