Research interests: Capital markets with information frictions; behavioral finance.

Education: Ph.D. in Economics, Cornell University, 2010

Curriculum Vitae: CV (January 2021)

Editorial Positions:

Journal of Finance, Associate Editor, 2018 – present.

Journal of Economic Theory, Associate Editor, 2018 – present.

Management Science, Associate Editor, 2018 – present.

Journal of Financial Markets, Associate Editor, 2016 – present.

Journal of Economic Dynamics and Control, Associate Editor, 2020 – present.

Publications (See also Google Scholar and Scopus Profile)

1. Costly Interpretation of Asset Prices, with Jordi Mondria and Xavier Vives, Management Science.
(Theory) An extension of the rational expectations equilibrium concept that allows investors to develop skills to interpret price data.

2. Strategic Trading When Central Bank Intervention Is Predictable, with Haoxiang Zhu, Review of Asset Pricing Studies.
(Theory) Uninformed investors engage in excessive sell-off in order to persuade the central bank to intervene and support the market.

3. Back-Running: Seeking and Hiding Fundamental Information in Order Flows, with Haoxiang Zhu, Review of Financial Studies, 2020, 33(4): 1484–1533.
(Theory) Fundamental informed investors and order-flow informed traders ("back-runner") play a hide-and-seek game.

4. Institutionalization, Delegation, and Asset Prices, with Shiyang Huang and Zhigang Qiu, Journal of Economic Theory, 2020, 186, 104977.
(Theory) Institutionalization raises the performance sensitive part of the equilibrium contract, making institutional investors effectively more risk averse.

5. Good Disclosure, Bad Disclosure, with Itay Goldstein, Journal of Financial Economics, 2019, 131(1): 118-138.
(Theory) Real-efficiency implications of different types of public information.

6. State-Owned Enterprises, Competition, and Disclosure, with Francesco Bova, Contemporary Accounting Research, 2018, 35(2): 596-621.
(Theory) A private firm can be more profitable competing against a state-owned enterprise than against another private firm.

7. Non-Fundamental Speculation Revisited, with Haoxiang Zhu, Journal of Finance, 2017, 72(6): 2759-2772.
(Theory) A linear pure strategy equilibrium fails to exist in Madrigal's (1996, Journal of Finance) setup, when the non-fundamental information is sufficiently precise.

8. Employee Bargaining Power, Inter-Firm Competition, and Equity-Based Compensation, with Francesco Bova, Journal of Financial Economics, 2017, 126(2): 342-363.
(Theory) Equity compensation allows a firm to negotiate a lower wage rate and become more competitive in the product market.

9. Disagreement, Underreaction, and Stock Returns, with Ling Cen and John Wei, Management Science, 2017, 63(4): 1214-1231.
(Theory, Empirical) Disagreement predicts future returns only in down markets.

10. Differential Access to Price Information in Financial Markets, with David A. Easley and Maureen O'Hara, Journal of Financial and Quantitative Analysis, 2016, 51(4): 1071-1110. Lead article.
(Theory) Curbing access to price information harms market quality and information production.
     Winner of the 2016 JFQA William F. Sharpe Award for Scholarship in Financial Research.
     Winner of the 2011 Northern Finance Association (NFA) Award for the Best Paper on Capital Markets.
     Winner of the 2011 Inaugural Meeting of The Chinese Finance Association (TCFA) Award for the Best Paper on Global Financial Markets.

11. Public Information and Uninformed Trading: Implications for Market Liquidity and Price Efficiency, with Bing Han and Ya Tang, Journal of Economic Theory, 2016, 163(5): 604-643.
(Theory) Public information improves market liquidity but harms information aggregation when noise traders chase market liquidity.
     Winner of the 2013 Chinese Finance Association (TCFA) Award for the Best Paper on Corporate Finance.

12. Loss Aversion, Survival, and Asset Prices, with David A. Easley, Journal of Economic Theory, 2015, 160(12): 494-516.
(Theory) Market selection is slow in terms of wealth dynamics, but it is effective in terms of pricing impact dynamics.
     Winner of the 2012 Northern Finance Association (NFA) Award for the Best Paper on Capital Markets.

13. Information Diversity and Complementarities in Trading and Information Acquisition, with Itay Goldstein, Journal of Finance, 2015, 70(4): 1723-1765.
(Theory) Title is self-explanatory.

14. Opaque Trading, Disclosure, and Asset Prices: Implications for Hedge Fund Regulation, with David A. Easley and Maureen O'Hara, Review of Financial Studies, 2014, 27(4): 1190-1237.
(Theory) The opaque trading of hedge funds creates its own risk to the economy through an ambiguity aversion channel.

15. Speculation and Hedging in Segmented Markets, with Itay Goldstein and Yan Li, Review of Financial Studies, 2014, 27(3): 881-922.
(Theory) More informed traders may reduce price informativeness, leading to strategic complementarities in information production when traders have different investment opportunities.

16. Rational Information Leakage, with Raffi Indjejikian and Hai Lu, Management Science, 2014, 60(11): 2762-2775.
(Theory) Leaking information to an unrelated party can benefit the insider.

17. Prospect Theory, the Disposition Effect, and Asset Prices, with Yan Li, Journal of Financial Economics, 2013, 107(3): 715-739.
(Theory) Diminishing sensitivity leads to the disposition effect, price momentum, and price-volume co-movement, while loss aversion predicts the opposite.
     Winner of the 2009 FMA Conference Best Paper Award.
     Summarized in Finance and Accounting Memos (inaugural issue).

18. Asset-Pricing Implications of Dividend Volatility, with Yan Li, Management Science, 2013, 59(9): 2036-2055.
(Theory, Empirical) Dividend volatility as a fundamental risk metric can predict stock returns.

19. Social Networks, Information Acquisition, and Asset Prices, with Bing Han, Management Science, 2013, 59(6): 1444-1457.
(Theory) Social communication improves (harms) market quality in economies with exogenous (endogenous) information.

20. Investor Sentiment, Disagreement, and the Breadth-Return Relationship, with Ling Cen and Hai Lu, Management Science 2013, 59(5): 1076-1091.
(Theory, Empirical) The Baker-Wurgler sentiment index helps to predict the breadth-return relation in the U.S. market.

21. Testing Conditional-Factor Models: A Nonparametric Approach, with Yan Li, Journal of Empirical Finance, 2011, 18(5): 972-992.
(Empirical) A state-variable-free, nonparametric approach to testing conditional factor models.

22. Complementarities, Multiplicity, and Supply Information, with Jayant V. Ganguli, Journal of the European Economic Association, 2009, 7(1): 90-115.
(Theory) Supply information increases coordination possibilities in the financial market, leading to multiple equilibria, which is suggestive of excess volatility and crashes.

23. Theory of Negative Consumption Externalities with Applications to the Economics of Happiness, with Guoqiang Tian, Economic Theory, 2009, 39(3): 399-424.
(Theory) Increasing wealth can hurt social welfare via "peer-group effects."

Review Articles

24. Information Disclosure in Financial Markets, with Itay Goldstein, Annual Review of Financial Economics, 2017, 9: 101-125.
(Theory) A coherent framework summarizing several key channels through which public information affects financial markets and real economy.

25. Loss Aversion in Financial Markets, Journal of Mechanism and Institution Design, 2019, 4(1): 119–137.
(Theory) A non-technical survey on how loss aversion affects investor behavior and financial markets.

Selected Working Papers

26. Disclosure, Competition, and Learning from Asset Prices.
(Theory) Oligopoly firms use disclosure to endogenously shape their information environments in financial markets.

27. Commodity Financialization and Information Transmission, with Itay Goldstein.
(Theory) An asymmetric information model of commodity futures prices affecting spot prices through a supply channel.

28. Skill Acquisition and Information Sales, with Shiyang Huang and Yan Xiong.
(Theory) Investors acquire skills to interpret the data sold by a data vendor.

29. Overt and Secret Information Acquisition in Financial Markets, with Yan Xiong.
(Theory) Whether information acquistion by investors is observable matters for investor behaivor and market quality.

30. Market Feedback: Who Learns What? , with Itay Goldstein and Jan Schneemeier.
(Theory) Is the financial market a side show when the information environment is endogenous?

Teaching: Capital Market Theory (Undergraduate); Derivatives (MF); Advanced Derivatives (MBA); Financial Theory (Ph.D.)