Research

 

Recent Working Papers

 

"Granular Betas and Risk Premium Functions" (with Andrew J. Patton and Rogier Quaedvlieg), "Supplemental Appendix."


"News and Asset Pricing: A High-Frequency Anatomy of the SDF" (with Saketh Aleti), "Supplemental Appendix."


"Intraday Market Return Predictability Culled from the Factor Zoo" (with Saketh Aleti and Mathias Siggaard), "Supplemental Appendix."


"Forecasting and Managing Correlation Risks" (with Sophia Zhengzi Li and Yushan Tang).


 

Select Publications

 

2023


"Optimal Inference for Spot Regressions" (with Jia Li and Yuexuan Ren), "Supplemental Appendix," American Economic Review, forthcoming.


"Optimal Nonparametric Range-Based Volatility Estimation" (with Jia Li and Qiyuan Li), "Supplemental Appendix," Journal of Econometrics, forthcoming.


"The Jump Leverage Risk Premium" (with Viktor Todorov), Journal of Financial Economics, Vol.150, No.3, Article No.103723, pp.1-20. 

 

2022


"Realized Semi(Co)Variation: Signs that All Volatilities are Not Created Equal" (2021 SoFiE Presidential Address), Journal of Financial Econometrics, Vol.20, No.2, pp.219-252.


"Realized Semibetas: Disentangling 'Good' and 'Bad' Downside Risks" (with Andrew J. Patton and Rogier Quaedvlieg), "Supplemental Appendix," Journal of Financial Economics, Vol.144, No.1, pp.227-246.


"From Zero to Hero: Realized Partial (Co)Variances" (with Marcelo C. Medeiros, Andrew J. Patton and Rogier Quaedvlieg), "Supplemental Appendix," Journal of Econometrics, Vol.231, No.2, pp.348-360.


"Equity Clusters through the Lens of Realized Semicorrelations" (with Andrew J. Patton and Haozhe Zhang), Economics Letters, Vol.211, Article No.110245, pp.1-5. 

"Occupation Density Estimation for Noisy High-Frequency Data" (with Jia Li and Congshan Zhang), Journal of Econometrics, Vol.227, No.1, pp.189-211.

 

2021


"Fixed-k Inference for Volatility" (with Jia Li and Zhipeng Liao), "Supplemental Appendix," Quantitative Economics, Vol.12, No.4, pp.1053-1084. 

 

"Generalized Jump Regressions for Local Moments" (with Jia Li and and Leonardo Salim Saker Chaves), "Supplemental Appendix," Journal of Business and Economic Statistics, Vol.39, No.4, pp.1015-1025. 

 

2020

 

"Realized Semicovariances" (with Jia Li, Andrew J. Patton and Rogier Quaedvlieg), "Supplemental Appendix," Econometrica, Vol.88, No.4, pp.1515-1551. 

"Multivariate Leverage Effects and Realized Semicovariance GARCH Models" (with Andrew J. Patton and Rogier Quaedvlieg), Journal of Econometrics, Vol.217, No.2, pp.411-430.


"Good Volatility, Bad Volatilty and the Cross-Section of Stock Returns" (with Sophia Zhengzi Li and Bingzhi Zhao), Journal of Financial and Quantitative Analysis, Vol.55, No.3, pp.751-781.

2019

 

"High-Dimensional Multivariate Realized Volatility Estimation" (with Nour Meddahi and Serge Nyawa), "Supplemental Appendix," Journal of Econometrics, Vol.210, No.1, pp.116-136.

2018

 

"Volume, Volatility and Public News Announcements" (with Jia Li and Yuan Xue), "Supplemental Appendix," Review of Economic Studies, Vol.85, No.4, pp.2005-2041. 

"Risk Everywhere: Modeling and Managing Volatility" (with Benjamin Hood, John Huss and Lasse Heje Pedersen),
 "Supplemental Appendix," Review of Financial Studies, Vol.31, No.7, pp.2730-2773. 

"Modeling and Forecasting (Un)Reliable Realized Covariances for More Reliable Financial Decisions" (with Andrew J. Patton and Rogier Quaedvlieg), Journal of Econometrics, Vol.207, No.1, pp.71-91. 

Volatility: The International Library of Critcal Writings in Economics (ed. with Torben G. Andersen), Edward Elgar Publishing Ltd., Cheltenham, U.K., "Table of Contents" and "Introduction."  

2016

 

"Roughing up Beta: Continuous vs. Discontinuous Betas and the Cross-Section of Expected Stock Returns" (with Sophia Zhengzi Li and Viktor Todorov), Journal of Financial Economics, Vol.120, pp.464-490. 

"Daily House Price Indices: Construction, Modeling, and Longer-Run Predictions" (with Andrew J. Patton and Wenjing Wang), Journal of Applied Econometrics, Vol.31, pp.1005-1025. 

"Exploiting the Errors: A Simple Approach for Improved Volatility Forecasting" (with Andrew J. Patton and Rogier Quaedvlieg), "Supplemental Appendix," Journal of Econometrics, Vol.192, No.1, pp.1-18. Zipfile with Matlab code and data for replicating results and computing corrected tables. 

2015

 

"Tail Risk Premia and Return Predictability" (with Viktor Todorov and Lai Xu), "Supplemental Appendix," Journal of Financial Economics, Vol.118, pp.113-134. 

"Stock Return and Cash Flow Predictability: The Role of Volatility Risk" (with Lai Xu and Hao Zhou), "Supplemental Appendix," Journal of Econometrics, Vol.187, No.2, pp.458-471. 

2014

 

"Time-Varying Jump Tails" (with Viktor Todorov), Journal of Econometrics, Vol.183, No.2, pp.168-180.

"Stock Return Predictability and Variance Risk Premia: Statistical Inference and International Evidence" (with James Marrone, Lai Xu and Hao Zhou), Journal of Financial and Quantitative Analysis, Vol.49, No.3, pp.633-661.

2013

 

"Jump Tails, Extreme Dependencies, and the Distribution of Stock Returns" (with Viktor Todorov and Sophia Zhengzi Li), Journal of Econometrics, Vol.172, No.2, pp.307-324.

"Risk and Return: Long-Run Relationships, Fractional Cointegration, and Return Predictability" (with Daniela Osterrieder, Natalia Sizova and George Tauchen), Journal of Financial Economics, Vol.108, No.2, pp.409-424.
 

"Financial Risk Measurement for Financial Risk Management" (with Torben G. Andersen, Peter F. Christoffersen and Francis X. Diebold), in Handbook of the Economics of Finance, Vol.II (eds. George Constanides, Milton Harris and Rene Stulz), Chapter 17, pp.1127-1220. Amsterdam: Elsevier Science B.V.
 

2012

 

"Volatility in Equilibrium: Asymmetries and Dynamic Dependencies" (with Natalia Sizova and George Tauchen), Review of Finance, Vol.16, No.1, pp.31-80.

2011

 

"Estimation of Jump Tails" (with Viktor Todorov), Econometrica, Vol.79, No.6, pp.1727-1783.

"Tails, Fears, and Risk Premia" (with Viktor Todorov), Journal of Finance, Vol.66, No.6, pp.2165-2221.
 Supplementary Appendix. 

"A Reduced Form Framework for Modeling Volatility of Speculative Prices based on Realized Variation Measures" (with Torben G. Andersen and Xin Huang), Journal of Econometrics, Vol.160, No.1, pp.176-189.

"Realized Volatility Forecasting and Market Microstructure Noise" (with Torben G. Andersen and Nour Meddahi), Journal of Econometrics, Vol.160, No.1, pp.220-234.

"Dynamic Estimation of Volatility Risk Premia and Investor Risk Aversion from Option-Implied and Realized Volatilities" (with Michael Gibson and Hao Zhou), Journal of Econometrics, Vol.160, No.1, pp.235-245.

"Periodicity, Non-Stationarity, and Forecasting of Economic and Financial Time Series: Editors Introduction" (with Bent Jesper Christensen, Niels Haldrup and Asger Lunde), Journal of Time Series Econometrics, Vol.3, No.1, pp.1-7.

2010

 

"Jumps and Betas: A New Framework for Disentangling and Estimating Systematic Risks" (with Viktor Todorov), Journal of Econometrics, Vol.157, No.2, pp.220-235.

"Continuous-Time Models, Realized Volatilities, and Testable Distributional Implications for Daily Stock Returns" (with Torben G. Andersen, Per H. Frederiksen and Morten X. Nielsen), Journal of Applied Econometrics, Vol.25, No.2, pp.233-261.

"Parametric and Nonparametric Volatility Measurement" (with Torben G. Andersen and Francis X. Diebold), in Handbook of Financial Econometrics (eds. Yacine Aot-Sahalia and Lars P. Hansen). Chapter 2, pp.67-128. Amsterdam: Elsevier Science B.V.

Volatility and Time Series Econometrics: Essays in Honor of Robert F. Engle (ed. with Jeffrey R. Russell and Mark W. Watson). Oxford, UK: Oxford University Press.

"Glossary to ARCH (GARCH)" in Volatility and Time Series Econometrics: Essays in Honor of Robert F. Engle (eds. Tim Bollerslev, Jeffrey R. Russell and Mark W. Watson), Chapter 8, pp.137-163. Oxford: Oxford University Press.

2009

 

"Expected Stock Returns and Variance Risk Premia" (with George Tauchen and Hao Zhou), Review of Financial Studies, Vol.22, No.11, pp.4463-4492, 2009.

"A Discrete-Time Model for Daily S&P 500 Returns and Realized Variations: Jumps and Leverage Effects" (with Uta Kretschmer, Christian Pigorsch and George Tauchen), Journal of Econometrics, Vol.150, pp.151-166.

2008

 

"Risk, Jumps, and Diversification" (with Tzuo Hann Law and George Tauchen), Journal of Econometrics, Vol.144, No.1, pp.234-256.

2007

 

"Real-Time Price Discovery in Stock, Bond and Foreign Exchange Markets" (with Torben G. Andersen, Francis X. Diebold, and Clara Vega), Journal of International Economics, Vol.73, pp.251-277.

"Roughing it Up: Disentangling Continuous and Jump Components in Measuring, Modeling and Forecasting Asset Return Volatility" (with Torben G. Andersen and Francis X. Diebold), Review of Economics and Statistics, Vol.89, No.4, pp.701-720.

"Investor Attention and Time-Varying Comovements" (with Lin Peng and Wei Xiong), European Financial Management, Vol.13, No.3, pp.394-422.

"No-Arbitrage Semi-Martingale Restrictions for Continuous-Time Volatility Models subject to Leverage Effects, Jumps and i.i.d. Noise: Theory and Testable Distributional Implications" (with Torben G. Andersen and Dobrislav Dobrev), Journal of Econometrics, Vol.138, No.1, pp.125-180.

2006

 

"Leverage and Volatility Feedback Effects in High-Frequency Data" (with Julia Litvinova and George Tauchen), Journal of Financial Econometrics, Vol.4, No.3, pp.353-384.

"Volatility Puzzles: A Simple Framework for Gauging Return-Volatility Regressions" (with Hao Zhou), Journal of Econometrics, Vol.131, No.1, pp.123-150.

"Comment on Realized Variance and Market Microstructure Noise" (with Torben G. Andersen, Per H. Frederiksen and Morten X. Nielsen), Journal of Business and Economic Statistics, Vol.24, pp.173-179.

"Volatility and Correlation Forecasting" (with Torben G. Andersen, Peter Christoffersen and Francis X. Diebold), in Handbook of Economic Forecasting (eds. Graham Elliott, Clive W.J. Granger and Allan Timmermann), Chapter 15, pp.777-878. Amsterdam: Elsevier Science B.V.

"Practical Volatility and Correlation Modeling for Financial Market Risk Management" (with Torben G. Andersen, Peter Christoffersen, and Francis X. Diebold), in Risks of Financial Institutions and the Financial Sector (eds. Rene Stulz and Mark Carey), Chapter 11, pp.513-544. Chicago: University of Chicago Press.

"Realized Beta: Persistence and Predictability" (with Torben G. Andersen, Francis X. Diebold, and Ginger Wu), in Advances in Econometrics: Econometric Analysis of Economic and Financial Time Series, Vol.20 (eds. Thomas B. Fomby and Dek Terrell), pp.1-40. Amsterdam: Elsevier Science B.V.

2005

 

"A Framework for Exploring the Macroeconomic Determinants of Systematic Risk" (with Torben G. Andersen, Francis X. Diebold and Ginger Wu), American Economic Review, Vol.95, No.2, pp.398-404.

"Correcting the Errors: Volatility Forecast Evaluation using High-Frequency Data and Realized Volatilities" (with Torben G. Andersen and Nour Meddahi), Econometrica, Vol.73, No.1, pp.279-296.

2004

 

"Analytic Evaluation of Volatility Forecasts" (with Torben G. Andersen and Nour Meddahi), International Economic Review, Vol.45, No.4, pp.1079-1110.

2003

 

"Modeling and Forecasting Realized Volatility" (with Torben G. Andersen, Francis X. Diebold, and Paul Labys), Econometrica, Vol.71, No.2, pp.579-625.

"Micro Effects of Macro Announcements: Real-Time Price Discovery in Foreign Exchange" (with Torben G. Andersen, Francis X. Diebold, and Clara Vega), American Economic Review, Vol.93, No.1, pp.38-62.

"Measuring and Modeling Systematic Risk in Factor Pricing Models using High-Frequency Data" (with Benjamin Y.B. Zhang), Journal of Empirical Finance, Vol.10, No.5, pp.533-558.

2002

 

"Estimating Stochastic Volatility Diffusions Using Conditional Moments of Integrated Volatility" (with Hao Zhou), Journal of Econometrics, Vol.109, pp.33-65, and "Corrigendum," Vol.119, pp.221.

"Bridging the Gap Between the Distribution of Realized (ECU) Volatility and ARCH Modeling (of the Euro): The GARCH-NIG Model" (with Lars E. Forsberg), Journal of Applied Econometrics, Vol.17, pp.535-548.

2001

 

"The Distribution of Realized Exchange Rate Volatility" (with Torben G. Andersen, Francis X. Diebold, and Paul Labys), Journal of the American Statistical Association, Vol.96, pp.42-55.

"The Distribution of Realized Stock Return Volatility" (with Torben G. Andersen, Francis X. Diebold, and Heiko Ebens), Journal of Financial Economics, Vol.61, pp.43-76.

"Variance-Ratio Statistics and High-Frequency Data: Testing for Changes in Intraday Volatility Patterns" (with Torben G. Andersen and Ashish Das), Journal of Finance, Vol. 56, No.1, pp.305-327.

"Volatility Forecasting, High-Frequency Data, and Frequency Domain Inference" (with Jonathan H. Wright), Review of Economics and Statistics, Vol.83, pp.596-602.

"Financial Econometrics: Past Developments and Future Challenges," Journal of Econometrics, Vol.100, No.1, pp.41-51.

2000

 

"Semiparametric Estimation of Long-Memory Volatility Dependencies: The Role of High-Frequency Data" (with Jonathan H. Wright), Journal of Econometrics, Vol.98, No.1, pp.81-106.

"The Forward Premium Anomaly is Not as Bad as You Think" (with Richard T. Baillie), Journal of International Money and Finance, Vol.19, No.4, pp.471-488.

"Intraday and Interday Volatility in the Japanese Stock Market" (with Torben G. Andersen and Jun Cai), Journal of International Financial Markets, Institutions & Money, Vol.10, No.2, pp.107-130.

"Intraday Periodicity, Long-Memory Volatility, and Macroeconomic Announcement Effects in the U.S. Treasury Bond Market" (with Jun Cai and Frank M. Song), Journal of Empirical Finance, Vol.7, No.1, pp.37-55.

"Exchange Rate Returns Standardized by Realized Volatility are (Nearly) Gaussian" (with Torben G. Andersen, Francis X. Diebold, and Paul Labys), Multinational Finance Journal, Vol.4, No.3&4, pp.159-179.

"Great Realizations" (with Torben G. Andersen, Francis X. Diebold, and Paul Labys), Risk, Vol.13, pp.105-108.

1999

 

"Long-Term Equity AnticiPation Securities and Stock Market Volatility Dynamics" (with Hans O. Mikkelsen), Journal of Econometrics, Vol.92, No.1, pp.75-99.

"Forecasting Financial Market Volatility: Sample Frequency vis-a-vis Forecast Horizon" (with Torben G. Andersen and Steve Lange), Journal of Empirical Finance, Vol.6, No.5, pp.457-477.

"Equity Trading Volume and Volatility: Latent Information Arrivals and Common Long-Run Dependencies" (with Peter D. Jubinski), Journal of Business and Economic Statistics, Vol.17, No.1, pp.9-21.

1998

 

"Answering the Skeptics: Yes, Standard Volatility Models do Provide Accurate Forecasts" (with Torben G. Andersen), International Economic Review, Vol.39, No.4, pp.885-905.

"DM-Dollar Volatility: Intraday Activity Patterns, Macroeconomic Announcements, and Longer-Run Dependencies" (with Torben G. Andersen), Journal of Finance, Vol.53, No.1, pp.219-265.

"Towards a Unified Framework for High- and Low-Frequency Return Volatility Modeling" (with Torben G. Andersen), Statistica Neerlandica, Vol.52, No.3, pp.273-302.

"ARCH and GARCH Models" (with Torben G. Andersen), in Encyclopedia of Statistical Sciences Vol.II (eds. Samuel Kotz, Campbell B. Read and David L. Banks), pp.6-16. New York: John Wiley and Sons Inc.

1997

 

"Heterogeneous Information Arrivals and Return Volatility Dynamics: Uncovering the Long-Run in High Frequency Returns" (with Torben G. Andersen), Journal of Finance, Vol.52, No.3, pp.975-1005.

"Order Flow and the Bid-Ask Spread: An Empirical Probability Model of Screen-Based Trading" (with Ian Domowitz and Jianxin Wang), Journal of Economic Dynamics and Control, Vol.21, pp.1471-1491.

"Intraday Periodicity and Volatility Persistence in Financial Markets" (with Torben G. Andersen), Journal of Empirical Finance, Vol.4, No.2-3, pp.115-158.

1996

 

"Fractionally Integrated Generalized Autoregressive Conditional Heteroskedasticity" (with Richard T. Baillie and Hans O. Mikkelsen), Journal of Econometrics, Vol.74, pp.3-30.

"Modeling and Pricing Long-Memory in Stock Market Volatility " (with Hans O. Mikkelsen), Journal of Econometrics, Vol.73, No.1, pp.151-184.

"Periodic Autoregressive Conditional Heteroskedasticity" (with Eric Ghysels), Journal of Business and Economic Statistics, Vol.14, No.2, pp.139-151.

1995

 

"Financial Market Efficiency Tests" (with Robert J. Hodrick), in Handbook of Applied Econometrics, Vol.I (eds. M. Hashem Pesaran and Michael Wickens), Chapter 9, pp.415-458. London: Basil Blackwell.

"On the Interdependence of International Asset Markets " (with Richard T. Baillie), in Global Portfolio Diversification: Risk Management, Market Microstructure, and Implementation Issues (eds. Raj Aggarwal and David C. Schirm), Chapter 2, pp.19-29. Orlando, Florida: Academic Press.

"Dan Nelson Remembered" (with Peter E. Rossi), Journal of Business and Economic Statistics, Vol.13, No.4, pp.361-364.

1994

 

"Cointegration, Fractional Cointegration, and Exchange Rate Dynamics" (with Richard T. Baillie), Journal of Finance, Vol.49, No.2, pp.737-745.

"Bid-Ask Spreads and Volatility in the Foreign Exchange Market: An Empirical Analysis" (with Michael Melvin), Journal of International Economics, Vol.36, No.3/4, pp.355-372.

"The Long-Memory of the Forward Premium" (with Richard T. Baillie), Journal of International Money and Finance, Vol.13, No.5, pp.565-571.

"ARCH Models" (with Robert F. Engle and Daniel B. Nelson), in Handbook of Econometrics, Vol.IV (eds. Robert F. Engle and Daniel McFadden), Chapter 49, pp.2959-3038. Amsterdam: Elsevier Science B.V.

1993

 

"Common Persistence in Conditional Variances" (with Robert F. Engle), Econometrica, Vol.61, No.1, pp.167-186.

"Trading Patterns and Prices in the Interbank Foreign Exchange Market" (with Ian Domowitz), Journal of Finance, Vol.48, No.4, pp.1421-1443.

"Bear Squeezes, Volatility Spillovers, and Speculative Attacks in the Hyperinflation 1920's Foreign Exchange" (with Richard T. Baillie and Michael Redfearn), Journal of International Money and Finance, Vol.12, No.5, pp.511-521.

"Some Effects of Restricting the Electronic Order Book in an Automated Trade Execution System" (with Ian Domowitz), in The Double Auction Market: Institutions, Theories, and Evidence (eds. Daniel Friedman and John Rust), Chapter 8, pp.221-252. Reading, Massachusetts: Addison-Wesley Publishing Company.

1992

 

"ARCH Modeling in Finance: A Review of the Theory and Empirical Evidence" (with Ray Y. Chou and Kenneth F. Kroner), Journal of Econometrics, Vol.52, No.1, pp.5-59.

"Quasi-Maximum Likelihood Estimation and Inference in Dynamic Models with Time Varying Covariances" (with Jeffrey M. Wooldridge), Econometric Reviews, Vol.11, No.2, pp.143-172.

"Prediction in Dynamic Models with Time Dependent Conditional Variances" (with Richard T. Baillie), Journal of Econometrics, Vol.52, No.1, pp.91-113.

"Nominal Exchange Rates" (with Richard T. Baillie), in The New Palgrave Dictionary of Money and Finance (ed. Peter Newman), pp.37-39. London: MacMillan Press Limited.

1991

 

"Intra Day and Inter Market Volatility in Foreign Exchange Rates" (with Richard T. Baillie), Review of Economic Studies, Vol.58, pp.565-585.

"Price Volatility, Spread Variability and the Role of Alternative Market Mechanisms" (with Ian Domowitz), Review of Futures Markets, Vol.10, No.1, pp.78-102.

"Les Modhles ARCH en Finance: Un Point sur la Thiorie et les Risultats Empiriques" (with Ray Y. Chou, Narayanan Jayaraman and Kenneth F. Kroner), Annales D'Iconomie et de Statistique, No.24, pp.1-59.

1990

 

"Modelling the Coherence in Short Run Nominal Exchange Rates: A Multivariate Generalized ARCH Model," Review of Economics and Statistics, Vol.72, No.3, pp.498-505.

"A Multivariate Generalized ARCH Approach to Modeling Risk Premia in Forward Foreign Exchange Markets" (with Richard T. Baillie), Journal of International Money and Finance, Vol.9, pp.309-324.

1989

 

"Common Stochastic Trends in a System of Exchange Rates" (with Richard T. Baillie), Journal of Finance, Vol.44, No.1, pp.167-181.

"The Message in Daily Exchange Rates: A Conditional Variance Tale" (with Richard T. Baillie), Journal of Business and Economic Statistics, Vol.7, No.3, pp.297-305.

1988

 

"A Capital Asset Pricing Model with Time Varying Covariances" (with Robert F. Engle and Jeffrey M. Wooldridge), Journal of Political Economy, Vol.96, No.1, pp.116-131.

"On the Correlation Structure for the Generalized Autoregressive Conditional Heteroskedastic Process," Journal of Time Series Analysis, Vol.9, No.2, pp.121-131.

1987

 

"A Conditionally Heteroskedastic Time Series Model for Speculative Prices and Rates of Return," Review of Economics and Statistics, Vol.69, No.3, pp.542-547.

1986

 

"Generalized Autoregressive Conditional Heteroskedasticity," Journal of Econometrics, Vol.31, pp.307-327.

"Modelling the Persistence of Conditional Variances" (with Robert F. Engle), Econometric Reviews, Vol.5, No.1, pp.1-50 and pp.81-87.

1985

 

"A Note on the Relation Between Consumers' Expenditure and Income in the United Kingdom," Oxford Bulletin of Economics and Statistics, Vol.47, No.2, pp.153-170.