 Hedge funds network and stock price crash riskYoutao Xiang and Sumuya Borjigin The North American Journal of Economics and Finance, 2025, vol. 75, issue PA Abstract: Utilizing a dataset from 2013 to 2022 on China’s listed companies, we explored whether a hedge fund network could help explain the occurrence of Chinese stock crash. First, this study constructs a hedge fund network based on common holdings. Then, from the perspective of network centrality, we explore the impact of hedge fund network on stock crash risk and its mechanisms. Our findings suggest that companies with greater network centrality experience lower stock crash risk. Such results remain valid after alternating measures, using the propensity score matching method, and excluding other network effects. We further document that the centrality of hedge fund network reduces crash risk through two channels: information asymmetry and governance monitoring. In addition, the negative impact of hedge fund network centrality on stock crash risk is more pronounced for non-SOEs firms. In summary, our research shed light on the important role of hedge fund information network in curbing stock crash. Keywords: Hedge funds; Information network; Stock crash risk; Network centrality (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:ecofin:v:75:y:2025:i:pa:s1062940824002134 DOI: 10.1016/j.najef.2024.102288 Access Statistics for this article The North American Journal of Economics and Finance is currently edited by Hamid Beladi More articles in The North American Journal of Economics and Finance from Elsevier |
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