• Graduate program
    • Why Tinbergen Institute?
    • Research Master
    • Admissions
    • Course Registration
    • Facilities
    • PhD Vacancies
    • Selected PhD Placements
    • Research Master Business Data Science
  • Research
  • Browse our Courses
  • Events
    • Summer School
      • Applied Public Policy Evaluation
      • Deep Learning
      • Economics of Blockchain and Digital Currencies
      • Economics of Climate Change
      • Foundations of Machine Learning with Applications in Python
      • From Preference to Choice: The Economic Theory of Decision-Making
      • Gender in Society
      • Machine Learning for Business
      • Marketing Research with Purpose
      • Sustainable Finance
      • Tuition Fees and Payment
      • Business Data Science Summer School Program
    • Events Calendar
    • Events Archive
    • Tinbergen Institute Lectures
    • 16th Tinbergen Institute Annual Conference
    • Annual Tinbergen Institute Conference
  • News
  • Alumni
Home | News | Paper by Esad Smajlbegovic and Amar Soebhag has been published in the Journal of Financial Economics
News | September 04, 2025

Paper by Esad Smajlbegovic and Amar Soebhag has been published in the Journal of Financial Economics

The paper ‘Stealthy shorts: Informed liquidity supply' by research fellow Esad Smajlbegovic (Erasmus University Rotterdam) and candidate fellow and alumnus Amar Soebhag (Erasmus University Rotterdam), together with co-authors Amit Goyal (University of Lausanne, Switzerland), Adam V. Reed (University of North Carolina, United States) has been published in the Journal of Financial Economics.

Paper by Esad Smajlbegovic and Amar Soebhag has been published in the Journal of Financial Economics

In this study they found that, contrary to long-held assumptions in financial markets, the most informed short sellers are not liquidity demanders, but actually liquidity suppliers. They are particularly informative about future returns on news days and trade on prominent cross-sectional return anomalies. Their analysis suggests that market making and opportunistic risk-bearing are unlikely to explain these findings. Instead, the results of this research align with recent market microstructure theory, pointing to strategic liquidity provision by informed traders. 

Article citation

Amit Goyal, Adam V. Reed, Esad Smajlbegovic, and Amar Soebhag, ‘Stealthy shorts: Informed liquidity supply', Journal of Financial Economics, Volume 172, October 2025, doi.org/10.1016/j.jfineco.2025.104155.