Villanova School of Business

Rabih Moussawi

Katherine and Richard Salisbury Endowed Professor

Professor of Finance

Villanova University

Department of Finance & Real Estate

Bartley Hall Rm 2051

800 E Lancaster Avenue

Villanova, PA 19085 Résumé

Email: rabih.moussawi@villanova.edu

Phone: (610) 519-8544

Homepage: http://www.homepage.villanova.edu/rabih.moussawi

SSRN: http://www.ssrn.com/author=491241

Google Scholar: https://scholar.google.com/citations?user=Mleyv4QAAAAJ&hl

Education:

Ph.D., Finance, The University of Texas at Dallas
MS, The University of Texas at Dallas
MBA, American University of Beirut
B.A. in Economics, with Distinction, American University of Beirut

Working Papers:

Operational Shorting and ETF Liquidity Provision, with Richard Evans, Michael Pagano, and John Sedunov. Revise-and-Resubmit at the Journal of Financial Economics. Featured in the Nasdaq #TradeTalks series on ETF Short Selling in the VSB co-hosted ETF conference with Nasdaq, Synapse 2018. Presented at the FINRA/Columbia University Market Structure Conference on Disruptive and Manipulative Activities, the European Finance Association 45th annual meeting, the Wharton School’s Jacobs Levy Equity Management Center for Quantitative Research 2018 Conference “10th Anniversary of the Financial Crisis,” and the VSB-Nasdaq 2018 Synapse Conference on ETFs.
The Unintended Consequences of Investing for the Long Run: Evidence from Target Date Funds, with Massimo Massa and Andrei Simonov. Featured in Institutional Investors, and Kiplinger. Winner of the BlackRock Award for best paper in Funds Management at the 35th Australasian Finance and Banking Conference (AFBC) at the University of New South Wales Business School, December 2022. Presented at the 2022 Financial Intermediation Research Conference in Budapest, Hungary, at the 2021 Conference on Ageing and Financial Markets, Mannheim, Germany, and the Financial Management Associations meetings, Denver, Colorado.
Do ETFs Increase the Commonality in Liquidity of Underlying Stocks? with Vikas Agarwal, Paul Hanouna, and Christof Stahel. Featured in the podcast Do Exchange Traded Funds (ETFs) Increase Volatility and Liquidity Risk? Villanova School of Business podcast series, 2018. Presented at the 28th Annual Conference on Financial Economics and Accounting, INQUIRE Annual Conference, Fourth Annual Global Quantitative Strategy Conference, CQA Trading Seminar, Northern Finance Association Annual Conference, the Third Smart Beta Summit, and the SEC’s Fifth Annual Conference on Financial Market Regulation.
Do Hedge Funds Really Avoid High Idiosyncratic Stocks? with Itzhak Ben-David and Denys Glushkov.

Publications:

The Role of Taxes in the Rise of ETFs, Review of Financial Studies (2025), Forthcoming, with Ke Shen and Raisa Velthuis. Presented at the Financial Management Association 2020 Annual Meeting, the American Finance Association 2021 Annual Meeting, 2022 University of North Carolina Tax Symposium, the Southern Finance Association 2022 Annual Meeting, and the 2024 Gabelli Funds Conference. Featured in Financial Times, ETF Trends, and Bloomberg.
Phantom of the Opera: ETF Shorting and Shareholder Voting, Management Science (2024), Forthcoming, with Richard Evans, Oguzhan Karakas, and Michael Young. Winner of the 4 Nations Cup in May 2019, and the best paper award of the European Financial Management Association in June 2019. Presented at American Finance Association 2020 Annual Meeting. Featured in the Harvard Law School Forum on Corporate Governance, June 2021.
Competition for Attention in the ETF Space, Review of Financial Studies (2023), with Itzhak Ben-David, Francesco Franzoni, and Byungwook Kim. Presented at the American Economic Association 2021 Annual Meeting. Featured in Bloomberg, in Financial Times, in Wall Street Journal, and in the WSJ Intelligent Investor article.
The Granular Nature of Large Institutional Investors, Management Science (2021), with Itzhak Ben-David, Francesco Franzoni, and John Sedunov, lead article. NBER Working Paper No. 22247. Winner of the 2016 Research Excellence Award from the Center for Global Leadership at Villanova University. Presented at the NBER Summer Institute 2015 Annual Meeting, the American Finance Association 2016 Annual Meeting. Featured in the Harvard Law School Forum on Corporate Governance and Financial Regulation, August 2016.
Institutional Investors and Bank Governance: An International Analysis of Bank Earnings Management, Journal of Corporate Finance (2021), with Steve Miller, Bin Wang, and Tina Yang.
Operating Lease Obligations and Corporate Cash Management, Journal of Corporate Finance (2021), with Robert Kieschnick and Douglas Cook.
A Project-Level Analysis of Value Creation in Firms, Financial Management (2020), with Jonathan Cohn and Umit Gurun. Presented at the American Finance Association 2013 meetings. Winner of the Editors’ Top Three Paper Award at Financial Management in Summer 2020.
An Improved Method to Predict Assignment of Stocks into Russell Indexes, Journal of Finance (2019), Replications and Corrigenda, web-only: https://afajof.org/comments-and-rejoinders/.
Operating leases, Operating leverage, Operational Inflexibility and Sticky Costs, Finance Research Letters (2019), with Robert Kieschnick and Douglas Cook.
Do ETFs Increase Volatility? Journal of Finance (2018), with Itzhak Ben-David and Francesco Franzoni, lead article. Presented at the Wharton School's Jacobs Levy 2014 Annual Conference, the American Finance Association 2013 meetings, Investment Company Institute 2013 conference, and NYSE Euronext-Paris Annual Hedge Fund 2012 Conference. NBER Working Paper No. 20071. Featured in the NBER Digest, September 2014.
Corporate Governance and Firm Survival, The Financial Review (2018), with Sinan Goktan and Robert Kieschnick. Winner of the Financial Review Editors' Choice Best Paper Award - 2018.
Firm Age, Corporate Governance, and Capital Structure Choices, Journal of Corporate Finance (2018), with Robert Kieschnick. Featured in the Harvard Law School Forum on Corporate Governance and Financial Regulation, December 2017. Listed among the most downloaded articles from Journal of Corporate Finance in September 2018.
Exchange Traded Funds (ETFs), The Annual Review of Financial Economics (2017), with Itzhak Ben-David and Francesco Franzoni. NBER Working Paper No. 22829. Featured in the Harvard Law School Forum on Corporate Governance and Financial Regulation, Nov. 2016.
Governance Mechanisms and Effective Activism: Evidence from Shareholder Proposals on Poison Pills, Journal of Empirical Finance (2017), with Mireia Gine and John Sedunov.
Capital Structure and Mergers: Retrospective Evidence from a Natural Experiment, Journal of Industry, Competition and Trade (2017), forthcoming, with Sumit Majumdar and Ulku Yaylacicegi.
Motivating Innovation in Newly Public Firms, Journal of Financial Economics (2014), with Nina Baranchuk and Robert Kieschnick. Featured in the Harvard Law School Forum on Corporate Governance and Financial Regulation, February 2014.
Do Hedge Funds Manipulate Stock Prices? Journal of Finance (2013), with Itzhak Ben-David, Francesco Franzoni, and Augustin Landier.
Working Capital Management and Shareholder Wealth, Review of Finance (2013), with Robert Kieschnick and Mark LaPlante.
Hedge Fund Stock Trading in the Financial Crisis of 2007-2009, Review of Financial Studies (2012), with Itzhak Ben-David and Francesco Franzoni, lead article.
Mutual Fund Performance when Parent Firms Simultaneously Manage Hedge Funds, Journal of Financial Intermediation (2010), with Gjergji Cici and Scott Gibson.
Do Incumbents' Mergers Influence Entrepreneurial Entry? An Evaluation, Entrepreneurship Theory and Practice(2014), with Sumit Majumdar and Ulku Yaylacicegi.
Mergers and Telecommunications Infrastructure Deployment: A Retrospective Analysis, Competition and Regulation in Network Industries (2014), with Sumit Majumdar and Ulku Yaylacicegi.
Merger Waves and Firm Growth, Annals of Public and Cooperative Economics (2013), with Sumit Majumdar and Ulku Yaylacicegi.
Mergers and synergy: Lessons from contemporary telecommunications history, Telecommunications Policy(2012), with Sumit Majumdar and Ulku Yaylacicegi.
Mergers, Jobs and Wages in the United States Telecommunications Industry, Human Relations (2010), with Sumit Majumdar and Ulku Yaylacicegi.
Is the Efficiency Doctrine Valid? An Evaluation of US Local Exchange Telecommunications Company Mergers, Digital Policy, Regulation and Governance - info (2010), with Sumit Majumdar and Ulku Yaylacicegi.

Honors and Awards:

BlackRock Best Paper Award, The 35th Australasian Finance and Banking Conference (AFBC), Winner of the BlackRock Award in Funds Management, December 2022.
Villanova University's Mid-Career Scholar Award, May 2022.
The Rising Star Media Award, Villanova School of Business, May 2021.
Editors’ Top Three Paper Award, Financial Management, Summer 2020.
Best Paper Award, 2019, The European Financial Management Association, Portugal, June 2019.
The McDonough Family Faculty Research Award, Villanova School of Business, May 2019.
The Financial Review Editors’ Choice Best Paper Award for 2018, April 2019.
Villanova University’s Scholarly Achievement Award, Villanova University, March 2019.
The Vincent B. DiDomenico Jr. ’88 Assistant Professor Research Award, Villanova School of Business, May 2017 – June 2019.
VSB Teaching Innovation Grant, Villanova School of Business, May 2017.
Best Paper Award, 2017 Research Excellence Awards, Center for Global Leadership, Villanova University, February 2017.
Best Paper Award, 2016, India Finance Association Conference, Emerald – IFC 2016 Best Paper, Indian Institute of Management, Ahmedabad, India, December 2016.
The ETF Research Academy Grant, 2016, Paris-Dauphine House of Finance and Lyxor Asset Management, Paris, France, June 2016.
Best Paper Award, 2016 Research Excellence Awards, Center for Global Leadership, Villanova University, February 2016.
Best Paper Award, 20th Annual Multinational Finance Society Conference, Izmir, Turkey, July 2013.
Outstanding Ph.D. Student Teacher of the Year, The University of Texas at Dallas, School of Management, 2004.

Research Interests:

ETFs; Hedge Funds; Institutional Investors; Investments; Corporate Finance; Corporate Governance

Courses Taught:

FIN 2323 - Equity Markets and Valuation
MSF 8645 - Quant Finance
MSA 8310 - Advanced Business Applications: Analytics in Fintech & Financial Textual Analysis
VSB 2121 - Special Topics in Finance: Undergraduate Finance Research Seminar

In the News Media:

The Economist, "Bitcoin ETFs are off to a bad start. Will things improve?" The Economist, Finance and Economics, Buttonwood, February 1, 2024.
Steve Johnson, "ETF share of US market turnover jumps to a record 31%," Financial Times, May 29, 2023.
Jean Dondo, "ETFs take centre stage in US market turnover," Wealth Professional, May 30, 2023.
Karishma Vanjani, "ARK Innovation and Others Offer Tempting ‘Thematic’ ETFs. Just Say No." Barron's, December 9, 2022.
Emma Boyde, ''Thematic ETFs tend to launch just before a steep fall in returns," Financial Times, March 7, 2022
Kongkon Gogoi and Zunjar Sanzgiri, "Thematic ETFs: is the juice worth the squeeze?" FirstLinks and Morningstar, August 25, 2021
Matt Levine, “Investors Will Buy Anything Now: Also bank buybacks, Treasury futures and ETF voting,” Bloomberg, June 28, 2021
Oguzhan Karakas, “Phantom of the Opera: ETF Shorting and Shareholder Voting,” Harvard Law School Forum on Corporate Governance, June 27, 2021
Ginger Szala, “Study Finding Target Date Funds 'Exploit' Investors,” ThinkAdvisor.com, June 22, 2021
John Rekenthaler, “The Latest Attack on Target-Date Funds,” Morningstar, May 20, 2021
John Sullivan, “TDFs Know You’re Not Paying Attention, So They Underperform,” 401K Specialist, May 5, 2021
Ben Hernandez, “A Higher Capital Gains Tax Could Move More Investors to ETFs,” ETF Trends, May 5, 2021
Mark Hulbert, “Why you should worry about the flood of new cash into U.S. stock funds,” Market Watch, May 4, 2021
Lee Barney, “Academics Say TDF Managers Take Advantage of Low-Attention Investors,” Plan Sponsor, May 4, 2021
Tommi Johnsen, “Competition for Attention in the ETF Space,” Alpha Architect, May 3, 2021
Claire Ballentine and Katherine Greifeld, “Rich Americans Fleeing Tax Hikes May Turbocharge Shift to ETFs,” Bloomberg, May 2, 2021
Massimo Massa, Rabih Moussawi, and Andrei Simonov, “The Disturbing Conflicts of Interest in Target Date Funds,” Kiplinger, April 30, 2021
Andreas Beys, “ETFs in den USA profitieren vor allem von diesem Steuervorteil,” Das Investment, March 29, 2021
Massimo Massa, Rabih Moussawi, and Andrei Simonov, “Target-Date Funds Exploit Their Investors’ Long Time Horizons. Here’s How,” Institutional Investors, March 23, 2021
Ryan Krystopowicz, “The So-Called Certainties in Life Seem A Lot Like Mutual Funds,” WisdomTree and Seeking Alpha, March 19, 2021
Dave Baxter, “The drawbacks of thematic ETFs,” Investors’ Chronicle, February 23, 2021
Tom Eckett, “European ETF market shows tax not main factor driving industry's growth,” ETF Stream, February 23, 2021
Ben Hernandez, “Tax Advantages Are Driving Investors from Mutual Funds to ETFs,” ETF Trends, February 17, 2021
Steve Johnson, "US ETF investors mainly motivated by tax loophole, study shows," Financial Times, February 15, 2021
Mark Hulbert, "New ETFs, Forced to Chase Trends, Shorten Their Own Lives," The Wall Street Journal, February 5, 2021
Geoff Colvin, “New Research finds sharply focused ETFs are not good for investors,” Fortune, January 31, 2021
Max Chen, “Thematic ETFs Could Expose Investors to Greater Risks,” ETF Trends, January 28, 2021
Mike Dolan, “Bubble-wary markets eye ETF crush in tech and crypto,” Reuters, January 27, 2021
Emma Boyde, "Thematic ETFs can deliver significant losses, academics find," Financial Times, January 26, 2021
Yakob Peterseil, "Day-Trader Frenzy for Trendy Stocks Is Defying Decades of Losses," Bloomberg, January 21, 2021
John Anderer, “Avoid ETFs: Finance experts warn against popular investment fund: You are likely to lose money,” Study Finds, January 21, 2021
Jason Zweig, “The Story Behind the Market’s Hottest Funds,” The Wall Street Journal, January 15, 2021
Jeff Grabmeier, “Want a hot stock tip? Avoid this type of investment fund,” Ohio State News, January 15, 2021
Chris Flood, "Top 10 Institutional Investors Fuel Market Volatility," Financial Times, August 8, 2020
Daniela Carosio, "Stock ownership by institutional investors cause higher stock price volatility, inefficiency, and fragility, Study Finds," SustainableValueInvestors.com, August 8, 2020
Francesco Franzoni, "The Effects of Concentration in the Asset Management Industry on Stock Prices," ProMarket, June 7, 2019
Simon Constable, "In a Down Market, ETFs Could Make Things Even Worse," The Wall Street Journal, March 3, 2019
Fixed Income Market Structure Advisory Committee - ETFs and Bond Funds Subcommittee , U.S. Securities and Exchange Commission, September 17, 2018. Preliminary SEC Recommendations are available here
Bob Eccles, "Concentration in the Asset Management Industry: Implications for Corporate Engagement," Forbes, April 17, 2019
Joseph DiStefano, “Will ETFs, their prices dependent on hedge fund billions, stay aligned in the next market panic?” The Inquirer/Philly.com, November 28, 2018
Ideas for Leaders, “Wrong Incentives Push CEO to Focus on the Short-term,” July 31, 2018
Robert Pozen and Theresa Hamacher, "Has the death knell of active management been rung too soon?" Financial Times, February 1, 2015
Jay Fitzgerald, "Do ETFs Increase Stock Volatility? ETF ownership of stocks leads to higher volatility and turnover," NBER Digest, National Bureau of Economic Research, September Issue, September 14, 2014
PBS Newshour, "Why is Wall Street becoming more bipolar?" September 12, 2014
Mike Dolan, "A volatile love affair with exchange funds and indexes," Reuters, April 30, 2014
Izabella Kaminska, "When ETFs make things more volatile," Financial Times, April 28, 2014
Larry Swedroe, “Side-by-side arrangements: An unequal alliance,” CBS MoneyWatch, June 4, 2013
Knowledge@Wharton, “Optimizing Working Capital: How to Deploy Liquidity and Create Value,” GE Capital, Americas, Capital Perspectives, May 2013
BizEd, “Some Hedge Funds Fudge the Numbers,” BizEd, May 2013
GE Capital and Knowledge@Wharton, “Improving Working Capital Management to Free Up Cash,” GE Capital, Americas, January 2013
Jason Zweig and Tom McGinty, “Fund Managers Lift Results With Timely Trading Sprees,” The Wall Street Journal, December 6, 2012
Rick Adamczak, “Study reveals some hedge funds inflate stock prices to impress investors,” Daily Reporter, December 11, 2012
Daniel Akst, “Do Hedge Funds Manipulate Stock Prices?” The Wall Street Journal, December 10, 2012
Caitlyn Grudzinski, “ETF Arbitrage May Be Driving Market Volatility,” TheStreet.com, August 2, 2012
Jason Zweig, “The Intelligent Investor: Now That's Performance Art,” The Wall Street Journal, December 24, 2011
Insider Monkey, “Do hedge funds manipulate stock prices?” Insider Monkey, June 2011
AllAboutAlpha.com, “Hedge funds and “stock manipulation”: Perpetrators, accomplices or just in the wrong place at the wrong time (again)?” AllAboutAlpha.com, March 2, 2011
Hannah Glover, “Conflicts in Side-by-Side Management: Mutual Funds Suffer When Managers Also Run Hedge Funds,” Money Management Executive, March 2007
Jack Willoughby, “The Perils of Favoritism,” Barron’s, March 19, 2007
Lawrence Strauss, “New Study on Old Controversy,” Barron’s, February 19, 2007
Michael Shari, “Side-by-Side Surprise,” Institutional Investor, February 7, 2007
John Wasik, “Dual Fund Management Can Pose Conflict,” Bloomberg, November 27, 2006
Alan Lavine, “Sub-Advisors Are in the House,” Financial Advisor, November 2006
Eric Baum, “Side-by-side funds manage around conflict,” Absolute Return Magazine, October 31, 2006
Michael Bauch, “Side-By-Side Management May Favor Hedge Over Mutual Funds,” Investopedia, September 18, 2006
Christopher Small, "Motivating Innovation in Newly Public Firms, Harvard Law School Forum on Corporate Governance and Financial Regulation," Wednesday February 12, 2014
Aaron Dolgoff and Tiago Duarte-Silva, "Fund Performance Indicators The SEC May Be Watching," Law360, Charles River Associates, May 02, 2014
Matt Palmquist, "Pushing CEOs to Be Bold after the IPO, Strategy and Business," PwC Strategy& Inc, September 9, 2014
Jackie Noblett, “Fresh evidence links ETFs to stock volatility,” Ignites magazine, and Financial Times, May 7, 2014
Kristina Zucchi, “How ETF Arbitrage Works,” Investopedia, March 26, 2015
Eleanor Laise, “Is Your Fund Manager Two-Timing You?” The Wall Street Journal, November 1, 2006
Mark Hulbert, “Which Fund Does an Advisor Love More,” The New York Times, July 9, 2006