Short selling and the pricing of closed-end funds

Gordon J. Alexander, Mark A. Peterson

Research output: Contribution to journalArticlepeer-review

4 Scopus citations


We analyze how short selling affects the pricing of U.S. closed-end funds over the 2010–2015 time period. Significant short selling is found in both premium and discount funds and increases as premiums rise. Funds with greater short selling experience significant declines in premiums over the next five days. Our analysis speaks to theories of closed-end fund pricing and is consistent with the neoclassical theory of closed-end fund pricing as described by Ross (2002), Berk and Stanton (2007), and Cherkes, Sagi, and Stanton (2009).

Original languageEnglish (US)
Pages (from-to)124-142
Number of pages19
JournalJournal of Financial Markets
StatePublished - Mar 2017

Bibliographical note

Publisher Copyright:
© 2016 Elsevier B.V.


  • Closed-end funds
  • Short selling


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