Working Papers

1. Measuring Firm-Level Currency Exposure

with Zhenkai Ran

SSRN

Presentation: 2nd International Workshop on Macroeconomics and Finance (University of Macau, Scheduled), University of Cambridge, Boston University

Abstract: We develop DoEx, a firm-quarter measure of currency exposure, built from how intensively managers and analysts discuss the currency environment—exchange-rate levels, volatility, and the dollar's direction—on quarterly earnings conference calls for 8,294 U.S.-listed firms over 2007–2024. DoEx tracks every major dollar episode of the period and rises with firms' real international footprints, and carries information well beyond alternative currency-exposure proxies, including foreign-sales ratios and return-based FX betas. Firms with higher exposure experience equity-price declines when the dollar appreciates, and they act on this exposure by using more FX derivatives and tilting their borrowing toward non-USD-denominated debt.

Keywords: Currency Exposure, Exchange Rates, Conference Calls, Textual Analysis, Hedging

JEL Classifications: F31, G14, G15, G32.

2. Transmission of Tariff Shocks via Institutional Investors

Second-year Paper, Sole-authored

SSRN

Presentation: CES Annual Conference 2026 (Presenter and Session Chair); MRS 2026 International Risk Conference (Accepted); IBEFA-WEAI Summer Meeting 2026 (Accepted); Boston University

Abstract: This paper examines how U.S. institutional investors amplify the effects of U.S. tariff shocks on U.S. and foreign firms. Using firm-level data from 2016-2023, I classify firms into directly targeted foreign exporters (Exposed), firms indirectly linked to exposed firms via supplier-customer relationships (Spillover), and product-market competitors of exposed firms (Competitor). I find that tariff shocks are largely unanticipated: pre-shock cumulative abnormal returns (CARs) are statistically indistinguishable from zero. Following tariff shocks, CARs decline for U.S. spillover firms but rise for U.S. competitors. Beyond asset prices, tariff shocks generate economically meaningful effects in firm outcomes. For foreign exposed firms, Tobin's Q falls by 0.2 in the shock quarter and remains depressed thereafter. Moreover, I identify a novel financial amplification channel operating through U.S. institutional trading, and find U.S. institutions sell off exposed and spillover firms. A one-standard-deviation decline in U.S. institutional holdings of U.S. spillover firms during tariff-shock quarters leads to an additional 2.2 percentage points reduction in sales growth and a 2.4 percentage points contraction in R&D growth. By contrast, increased U.S. institutional holdings lead to higher net margins and stronger capital expenditure growth among U.S. competitors in the long run. These findings imply that institutional portfolio reallocation both amplifies and prolongs the real effects of tariff shocks, with larger magnitudes for U.S. connected firms than for foreign connected firms on comparable outcomes.

Keywords: U.S. tariff shocks, institutional investors, supply chain, spillover effect, asset prices, firm outcomes

JEL Classification: F13, G11, G15, F14

More papers will come soon!