Michael Ferguson

Headshot of Michael Ferguson

Michael Ferguson

Associate Professor, Department of Finance, Real Estate, and Insurance and Risk Management

2352 Carl H. Lindner Hall

513-556-7080

Professor Ferguson graduated from Indiana University. Prior to joining UC he taught at the University of Arizona and Indiana University. Earlier he worked for First Chicago (now JP Morgan Chase) and the Commodity Futures Trading Commission.

Teaching Interest

Investments

Corporate Finance

Research Interest

Investments

Financial Institutions

Financial Contracting

History

Institution: University of Cincinnati

Title: Associate Professor of Finance

Institution: University of Cincinnati

Title: Assistant Professor of Finance

End Date: 2004-06-30

Institution: Indiana University

Title: Visiting Assistant Professor of Finance

End Date: 1999-07-31

Institution: University of Arizona

Title: Visiting Assistant Professor of Finance

End Date: 1996-08-31

Institution: Commodity Futures Trading Commission

Title: Financial Economist

End Date: 1993-06-30

Institution: Indiana University

Title: Associate Instructor/Research Assistant

End Date: 1991-07-31

Institution: First National Bank of Chicago

Title: Internal Consultant

End Date: 1986-06-30

Assignments

Finance Department Ph.D. program Coordintator Recruit new students...Advise current students...administer comprehensive exam

Dates: 2001-09-01 - 2014-09-30

MS Finance Admissions Recruiting, Advising

Dates: 2011-11-01 - 2012-06-30

Awards | Honors

Organization: Lindner College of Business

Name: Dean's List of Teaching Excellence

Year Received: 2018

Organization: Lindner College of Business

Name: Dean's List of Teaching Excellence

Year Received: 2017

Organization: UC Department of Athletics

Name: Simon Anderson Faculty Recognition Award--nominee

Year Received: 2017

Organization: Lindner College of Business

Name: Dean's List of Teaching Excellence

Year Received: 2016

Organization: Lindner College of Business

Name: Dean's List of Teaching Excellence

Year Received: 2016

Organization: Lindner College of Business

Name: Dean's List of Teaching Excellence

Year Received: 2015

Organization: Lindner College of Business

Name: Dean's List of Teaching Excellence

Year Received: 2015

Organization: Lindner College of Business

Name: Dean's List of Teaching Excellence

Year Received: 2015

Organization: Financial Management Association

Name: Best Paper in Investments, Semi-finalist

Year Received: 2014

Organization: Lindner College of Business

Name: Lindner Research Fellow

Year Received: 2014

Organization: Lindner College of Business

Name: Dean's List of Teaching Excellence

Year Received: 2013

Organization: Lindner College of Business

Name: Dean's List of Teaching Excellence

Year Received: 2012

Organization: Southwest Finance Association

Name: AAII Best Paper in Investments

Year Received: 2012

Organization: Financial Management Association

Name: Best Paper in Investments, Semi-finalist

Year Received: 2011

Organization: Financial Management Association

Name: Best Paper in Corporate Finance, Semi-finalist

Year Received: 2009

Organization: American Finance Association

Name: Smith-Breeden Prize, Finalist

Year Received: 2004

Organization: Southern Finance Association

Name: Best Paper on Futures or Options

Year Received: 1995

Organization: Financial Management Association

Name: Best Paper in Futures or Options on Futures

Year Received: 1993

Organization: IU Kelley School of Business

Name: Schuyler F. Otteson Undergraduate Teaching Excellence Award, Finalist

Year Received: 1991

Organization: IBM

Name: IBM Thomas Watson National Merit Scholarship

Year Received: 1981

Organization: Indiana Univeristy

Name: Indiana University Distinguished Scholarship

Year Received: 1981

Education

Institution: Indiana University

Location: Bloomington, Indiana

Major: Finance

Dissertation: Large Shareholders in the Market for Corporate Control

Completed: 1992

Degree: Ph D

Institution: Indiana University

Location: Bloomington, Indiana

Major: Finance

Completed: 1989

Degree: MBA

Institution: Indiana University

Location: Bloomington, Indiana

Major: Finance (with Honors)

Dissertation: Honors Thesis:  An Analysis of Market Timing Strategies

Completed: 1985

Degree: BS

Published Contributions

Vinod Changarath, Michael Ferguson, Yong Kim,  (2017). Do Capital Standards Promote Bank Safety? Evidence from Involuntary Recapitalizations. Banking and Finance Review, 1-32.

Michael Ferguson, Doina Chichernea, Haimont Kassa,  (2015). Idiosyncratic Risk, Investor Base, and Returns. Financial Management, 267-293.

Michael Ferguson, Hui Guo, Haimont Kassa,  (2014). On the Relation between EGARCH Idiosyncratic Volatility and Expected Stock Returns. Journal of Financial and Quantitative Analysis, 271-295.

Michael Ferguson, Bradley Stevenson,  (2014). Depositor Discipline and the Bank's Incentive to Monitor. Journal of Financial Economic Policy, 98-111.

Michael Ferguson, Steven  Mann,  (2004). Execution Costs and Their Intraday Variation in Futures Markets. Derivatives Markets and Foreign Exchange Markets, Financial Markets (Volume 4), Jeff Madura (editor).

Michael Ferguson, Richard Shockley,  (2003). Equilibrium 'Anomalies'. Journal of Finance, 2549-2580.

Michael Ferguson, Steven  Mann,  (2001). Execution Costs and Their Intraday Variation in Futures Markets. Journal of Business, 125-160.

Michael Ferguson, Stephen Peters,  (2000). Is Lending Discrimination Always Costly?. Journal of Real Estate Finance and Economics, 23-44.

Michael Ferguson, Steven Mann, Leonard  Schneck,  (1998). Concentrated Trading in the Foreign Exchange Futures Markets:  Discretionary Liquidity Trading or Market Closure?. Journal of Futures Markets, 343-362.

Michael Ferguson, Stephen Peters,  (1997). Cultural Affinity and Lending Discrimination:  The Impact of Underwriting Errors and Crisk Distribution on Applicant Denial Rates. Discrimination in Financial Services, George J. Benston, W. Curt Huner, and George G. Kaufman (editors).

Michael Ferguson, Stephen Peters,  (1997). Cultural Affinity and Lending Discrimination:  The Impact of Underwriting Errors and Crisk Distribution on Applicant Denial Rates. Journal of Financial Services Research, 153-168.

Michael Ferguson, Stephen  Peters,  (1997). What Constitutes Evidence of Discrimination in Lending?. The Economics of Housing, John M. Quiqley (editor).

Michael Ferguson, Leonard Schneck, Steven Mann,  (1996). Depth and Tightness. Chicago Board of Trade Research Symposium Proceedings, 85-124.

Michael Ferguson, Corinne Bronfman,  (1995). Don't Ask, Don't Tell and Other Contracting Considerations. Journal of Corporation Law, 155-175.

Michael Ferguson, Stephen  Peters,  (1995). What Constitutes Evidence of Discrimination in Lending?. Journal of Finance, 739-748.

Michael Ferguson, Corinne Bronfman,  (1995). Would Greater Transparency Increase or Decrease Contracting Costs?. Journal of Financial Engineering, 127-145.

Michael Ferguson,  (1994). Ownership Structure, Potential Competition, and the Free Rider Problem in Tender Offers. Journal of Law, Economics and Organization, 35-62.

Michael Ferguson, Leonard Schneck,  (1993). The Flight to Quality:  Evidence from the Futures Markets. Review of Futures Markets, 103-132.

Michael Ferguson,  (1991). Study Guide for F301:  Introduction to Corporate Finance. Indiana University, .

Michael Ferguson,  (1990). Study Guide for F250:  Personal Finance. Indiana University, .

Research in progress

Title: Fan Loyalty and Team Performance

Status: Writing Results

Research Type: Scholarly

Title: Is Bank Capital a Double-Edged Sword? The Impact of Forced Recapitalizations

Status: Writing Results

Research Type: Scholarly

Title: The Impact of a Strategic Regulator on Executive Compensation and Fraudulent Misreporting

Description: The passage of Sarbanes-Oxley Act in 2002 reflects the regulator’s strategic response to an epidemic of corporate fraud in the late 1990s. Recognizing the dynamic interplay between the manager’s decision to commit fraud and the regulator’s decision to investigate the firm, we empirically investigate the shareholder-manager-regulator nexus that determines the equilibrium relationships between the degree of reliance on equity based compensation (EBC), the firm’s growth potential, the extent of fraudulent reporting, and the intensity of fraud detection. Using a sample of recently prosecuted fraud firms collected from SEC litigation releases of the last 10 years and employing the bivariate probit model with partial observability, we find that fraud has mainly been concentrated in high-growth ‘new economy’ industries and fraud has mainly been detected during the recent economic downturn in those industries. Furthermore, greater reliance on EBC increases both the probability of fraud being committed and the conditional probability of detecting fraud. More importantly, greater fraud penalties due to the enactment of SOX reduce both of the probabilities. Using panel regressions, we also find strong evidence that EBC is positively associated with growth potential and negatively associated with fraud penalty in the (relatively fraud-prevalent) high-tech industries, while no such associations exist in the (relatively fraud-free) manufacturing industries. Overall, our empirical results highlight the importance of treating the regulatory agency as a rational player in the fraud commission and detection game. The interaction between the firm manager and the regulator determines the two unobservable probabilities that determine the level of observed fraud. In turn, the firm’s shareholders (or board of directors) rationally incorporate the implied fraud commission and detection probabilities into the optimal equity-based compensation contract awarded to the manager.

Status: Writing Results

Research Type: Scholarly

Presentations

Title: What Drives Merger and Bankruptcy Waves

Organization: Financial Management Association

Location: Boston, MA

Year: 2017

Title: Do Inventors Know More than Investors? Technology Spillover and the Valuation of Patents

Organization: Financial Management Association

Location: Nashville, TN

Year: 2014

Title: Do Inventors Know More than Investors? Technology Spillover and the Valuation of Innovation

Organization: Midwest Finance Association

Location: Orlando, FL

Year: 2014

Title: Do Inventors Know More than Investors? Technology Spillover and the Valuation of Innovation

Organization: Southern Finance Association

Location: Fajardo, PR

Year: 2013

Title: On the Relation between EGARCH Idiosyncratic Volatility and Expected Stock Returns

Organization: Eastern Finance Association

Location: Boston, MA

Year: 2012

Title: On the Relation between EGARCH Idiosyncratic Volatility and Expected Stock Returns

Organization: Southwest Finance Association

Location: New Orleans, LA

Year: 2012

Title: Do Capital Standards Promote Bank Safety? Evidence from Involuntary Recapitalizations (Working paper, Apr 2011)

Organization: Southern Economic Association

Location: Washington, DC

Year: 2011

Title: Do Capital Standards Promote Bank Safety? Evidence from Involuntary Recapitalizations (Working paper, Apr 2011)

Organization: Southern Finance Associatio

Location: Key West, FL

Year: 2011

Title: On the Relation between EGARCH Idiosyncratic Volatility and Expected Stock Returns

Organization: Financial Management Association

Location: Key West, FL

Year: 2011

Title: On the Relation between EGARCH Idiosyncratic Volatility and Expected Stock Returns

Location: Key West

Year: 2011

Title: On the Relation between EGARCH Idiosyncratic Volatility and Expected Stock Returns

Organization: Financial Management Association

Location: Denver, CO

Year: 2011

Title: Do Capital Standards Promote Bank Safety? Evidence from Involuntary Recapitalizations (Working paper, Apr 2011)

Organization: Financial Management Association

Location: Denver, CO

Year: 2011

Title: Does Equity-Based Compensation Really Have a ‘Dark Side’? The Influence of Regulatory Discretion

Organization: Singapore International Conference on Finance

Location: Singapore

Year: 2011

Title: Does Equity-Based Compensation Really Have a ‘Dark Side’? The Influence of Regulatory Discretion

Organization: China International Finance Conference

Location: Wuhan, China

Year: 2011

Title: Do Capital Standards Promote Bank Safety? Evidence from Involuntary Recapitalizations (Working paper, Apr 2011)

Organization: International Banking, Economics, and Finance Association

Location: San Diego, CA

Year: 2011

Title: Do Capital Standards Promote Bank Safety? Evidence from Involuntary Recapitalizations (Working paper, Apr 2011)

Organization: European Financial Management Association

Location: Porto, Portugal

Year: 2011

Title: Do Capital Standards Promote Bank Safety? Evidence from Involuntary Recapitalizations (Working paper, Apr 2011)

Organization: Korea Institute of Finance, Korea-America Economic Association and Korea-America Finance Association

Location: Seoul, Korea

Year: 2011

Title: Idiosyncratic Risk, Investor Base, and Returns

Organization: Midwest Finance Assocation

Location: Chicago, IL

Year: 2011

Title: Cross Market Liquidity Shocks:  Evidence from the CDS, Corporate Bond and Equity Markets

Organization: Financial Managment Association

Location: New York, NY

Year: 2010

Title: A New Methodology for Measuring and Using the Implied the Impied Market Value of Aggregate Corporate Debt in Asset Pricing:  Evidence from S&P 500 Index Put Option Prices

Organization: Financial Managment Association

Location: Reno, NV

Year: 2009

Title: Margin Requirements, Asset Pricing and Welfare Implications

Organization: Financial Managment Association

Location: Reno, NV

Year: 2009

Title: Deal Risk, Liquidity Risk, and the Profitability of Risk Arbitrage

Organization: Financial Management Association

Location: Reno, NV

Year: 2009

Title: Deal Risk, Liquidity Risk, and the Profitability of Risk Arbitrage

Organization: Eastern Finance Associatio

Location: Washington, DC

Year: 2009

Title: The Impact of a Strategic Regulator on Executive Compensation and Fraudulent Misreporting

Organization: Finance Management Association

Location: Dallas, Texas

Year: 2008

Title: Congress and the Stock Market

Organization: Financial Management Association

Location: Orlando, FL

Year: 2007

Title: What's Different About Banks? Depositor Discipline and Active Monitoring

Organization: Financial Management Association

Location: Orlando, FL

Year: 2007

Title: An In-Depth Analysis of Futures Market Liquidity

Year: 2003

Title: Equilibrium 'Anomalies'

Organization: University of Missouri

Year: 2002

Title: "Does Stock Market Momentum Explain the 'Smart Money' Effect?

Organization: Financial Management Association

Location: San Antonio, TX

Year: 2002

Title: Execution Costs and Their Intraday Variation in Futures Markets

Organization: Financial Management Association

Location: Orlando, FL

Year: 1999

Title: Equilibrium 'Anomalies'

Organization: Western Finance Association

Location: Santa Monica, CA

Year: 1999

Title: Equilibrium 'Anomalies'

Organization: University of Cincinnati

Year: 1999

Title: Equilibrium 'Anomalies'

Organization: Arizona State University - West

Year: 1999

Title: But I Know It When I See It:  An Economic Analysis of Vague Rules

Organization: Econometric Society

Location: New York, NY

Year: 1999

Title: Equilibrium 'Anomalies'

Organization: Southern Finance Association

Location: Marco Island, FL

Year: 1998

Organization: Financial Management Association

Location: Chicago, IL

Year: 1998

Title: Equilibrium 'Anomalies'

Organization: Financial Managent Association

Location: Chicago, IL

Year: 1998

Title: Equilibrium 'Anomalies'

Organization: Texas A&M University

Year: 1998

Title: Equilibrium 'Anomalies'

Organization: California State University - Fullerton

Year: 1998

Title: Equilibrium 'Anomalies'

Organization: University of Pittsburgh

Year: 1998

Title: Is Lending Discrimination Always Costly?

Location: Chicago, IL

Year: 1998

Title: But I Know It When I See It:  An Economic Analysis of Vague Rules

Organization: University of Cincinnati

Year: 1997

Title: But I Know It When I See It:  An Economic Analysis of Vague Rules

Organization: Indiana University Purdue University-Indianapolis

Year: 1997

Title: But I Know It When I See It:  An Economic Analysis of Vague Rules

Organization: University of Connecticut

Year: 1996

Title: A Symmetric-Information Model of Credit Rationing

Organization: European Finance Association

Location: Oslo, Norway

Year: 1996

Title: But I Know It When I See It:  An Economic Analysis of Vague Rules

Organization: Western Finance Association

Location: Sunriver, OR

Year: 1996

Title: Depth and Tightness

Organization: Chicago Board Of Trade

Location: Chicago, IL

Year: 1996

Title: Interbank Credit Market Heterogeneity and Lending Discrimination

Organization: Federal Reserve Bank of Chicago

Location: Chicago, IL

Year: 1996

Title: But I Know It When I See It:  An Economic Analysis of Vague Rules

Organization: Federal Reserve Bank of Chicago

Location: Chicago, IL

Year: 1996

Title: Depth and Tightness

Organization: American Finance Association

Location: San Francisco, CA

Year: 1996

Title: Depth and Tightness

Organization: Southern Finance Association

Location: Sarasota, FL

Year: 1995

Organization: Financial Management Association

Location: New York, NY

Year: 1995

Title: Loan Denial and Default Rates:  What Can TheyTell Us About Lending Discrimation

Organization: Eastern Finance Assocation

Location: Hilton Head, SC

Year: 1995

Title: Risk Arbitrageurs, Insider Trading, and the Allocation of Property Rights in Tender Offers

Organization: University of Arizona

Year: 1995

Title: Does Size Matter? Ownership Structure and the Division of Gains in Tender Offers

Organization: University of Arizona

Year: 1994

Title: Do Speculators Earn Positive Profits?

Organization: Financial Management Association

Location: St. Louis, MO

Year: 1994

Title: Does Size Matter? Ownership Structure and the Division of Gains in Tender Offers

Organization: Financial Management Association

Location: St. Louis, MO

Year: 1994

Title: Concentrated Trading in the Foreign Exchange Futures Markets:  Discretionary Liquidity Trading or Market Closure?

Organization: Financial Management Association

Location: Chicago, IL

Year: 1993

Title: Using the Capital Markets to Mitigate Moral Hazard:  The Case of Hedge Collateral Agreements

Organization: Financial Management Association

Location: Chicago, IL

Year: 1993

Title: Concentrated Trading in the Foreign Exchange Futures Markets:  Discretionary Liquidity Trading or Market Closure?

Organization: Indiana University

Location: Bloomington, Indiana

Year: 1993

Title: Concentrated Trading in the Foreign Exchange Futures Markets:  Discretionary Liquidity Trading or Market Closure?

Organization: Western Finance Association

Location: Whistler, British Columbia

Year: 1993

Title: Risk Arbitrageurs, Insider Trading, and the Allocation of Property Rights in Tender Offers

Organization: University of Arizona

Year: 1993

Organization: Utah Winter Finance Conference

Location: Park City, UT

Year: 1993

Title: Risk Arbitrageurs, Insider Trading, and the Allocation of Property Rights in Tender Offers

Organization: University of Tulsa

Year: 1992

Organization: Western Finance Association

Location: San Francisco, CA

Year: 1992

Title: The Flight to Quality:  Evidence from the Futures Markets

Organization: Chicago Board of Trade

Location: Chicago, IL

Year: 1992

Title: Ownership Struture, Potential Competition, and the Divisions of Gains in Tender Offers

Organization: Commodity Futures Trading Commission

Location: Washington, DC

Year: 1991

Title: Ownership Struture, Potential Competition, and the Divisions of Gains in Tender Offers

Organization: Concordia University

Location: Montreal

Year: 1991

Title: Ownership Struture, Potential Competition, and the Divisions of Gains in Tender Offers

Organization: Indiana University

Year: 1991