Hubris and Activist Hedge Fund Success

Albert M. Ahn; Yu Zhang

doi:10.5465/ambpp.2016.17858abstract

Hubris and Activist Hedge Fund Success

Albert M. Ahn, Yu Zhang

Department of Management, Marketing and Information Systems

Research output: Chapter in book/report/conference proceeding › Conference proceeding › peer-review

Abstract

The growing visibility and aggressive tactics by some activist hedge funds raises the question of what determines whether these activist campaigns are successful. Given the lack of significant governmental oversight of hedge funds and their incentive structure, we propose that hubris is likely to play a role in explaining their success. Specifically we investigate and find that hedge funds that exhibit more hubris based on prior campaigns and their aggressiveness towards the target firm are less likely to be successful in achieving their stated goals. Our paper contributes to understanding activist hedge funds by examining how hubris may impact their success or failure.

Original language	English
Title of host publication	Academy of Management Proceedings 2016
Editors	Sonia Taneja
Publisher	Academy of Management
DOIs	https://doi.org/10.5465/ambpp.2016.17858abstract
Publication status	Published - 1 Jan 2016
Event	76th Annual Meeting of the Academy of Management, AOM 2016: Making Organizations Meaningful - Anaheim, United States Duration: 5 Aug 2016 → 9 Aug 2016 https://aom.org/events/annual-meeting/past-annual-meetings/2016-making-organizations-meaningful (Conference website) https://journals.aom.org/toc/amproc/2016/1 (Conference proceedings) http://my.aom.org/ProgramDocs/2016/pdf/AOM_2016_Annual_Meeting_Program.pdf

Publication series

Name	Academy of Management Proceedings
Number	1
Volume	2016
ISSN (Print)	0065-0668
ISSN (Electronic)	2151-6561

Conference

Conference	76th Annual Meeting of the Academy of Management, AOM 2016
Country/Territory	United States
City	Anaheim
Period	5/08/16 → 9/08/16
Internet address	https://aom.org/events/annual-meeting/past-annual-meetings/2016-making-organizations-meaningful (Conference website) https://journals.aom.org/toc/amproc/2016/1 (Conference proceedings) http://my.aom.org/ProgramDocs/2016/pdf/AOM_2016_Annual_Meeting_Program.pdf

User-Defined Keywords

Activist Investors
Hedge Funds
Hubris

Access to Document

10.5465/ambpp.2016.17858abstract

Cite this

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title = "Hubris and Activist Hedge Fund Success",

abstract = "The growing visibility and aggressive tactics by some activist hedge funds raises the question of what determines whether these activist campaigns are successful. Given the lack of significant governmental oversight of hedge funds and their incentive structure, we propose that hubris is likely to play a role in explaining their success. Specifically we investigate and find that hedge funds that exhibit more hubris based on prior campaigns and their aggressiveness towards the target firm are less likely to be successful in achieving their stated goals. Our paper contributes to understanding activist hedge funds by examining how hubris may impact their success or failure.",

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AB - The growing visibility and aggressive tactics by some activist hedge funds raises the question of what determines whether these activist campaigns are successful. Given the lack of significant governmental oversight of hedge funds and their incentive structure, we propose that hubris is likely to play a role in explaining their success. Specifically we investigate and find that hedge funds that exhibit more hubris based on prior campaigns and their aggressiveness towards the target firm are less likely to be successful in achieving their stated goals. Our paper contributes to understanding activist hedge funds by examining how hubris may impact their success or failure.

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