William Kracaw

Color portrait of William Kracaw

Professor of Finance of Finance


Email Address wak4@psu.edu

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William Kracaw is the David and Shirley Sykes Professor at the Smeal College of Business. Professor Kracaw holds a B.S. in Chemical Engineering, MBA, and PhD in Business Administration from the University of Utah. He previously held an appointment at the Krannert Graduate School of Management at Purdue University.His teaching interests include financial markets, institutions, and financial risk management. Professor Kracaw has published research on a broad range of topics in financial intermediation,corporate governance and control,corporate risk management, and markets for derivative securities. His articles have appeared in several leading academic and professional journals, including the Journal of Finance, the Journal of Financial and Quantitative Analysis, Financial Management, and the Journal of Financial Intermediation. Professor Kracaw is the author of two books, Financial Risk Management, and Financial Institutions and Capital Markets. He has also served on the board of editors of two academic journals and previously on the board of directors of the Financial Management Association. Professor. Kracaw has consulted with a number of commercial banks, investment banks, and government agencies. In executive education, he has taught various courses in derivative markets, financial risk management, and international finance.

Expertise

Professor Kracaw is currently doing research on the impact of corporate governance structure on financial policy and strategy.

Education

Ph D, Finance, The University of Utah, 1980

MBA, The University of Utah, 1975

BS, Chemical Engineering, The University of Utah, 1970

Courses Taught

FIN 577 – FIN ENG CORP STRAT (2)
This course provides an overview of some of the important issues and problems encountered in recognizing exposures to risk in both financial and non-financial firms, and provides students with a strategic decision-making perspective. Considerable importance will be placed on how exposures to risk affect the firm, and how risk exposures can be re-engineered to enhance firm value. An overview of financial markets and the major sources of risk exposure to the firm will be provided. Measurement of risk exposures will be discussed and various methods of managing and controlling risk will be explored. Tools of the financial engineer 'futures, options, swaps, and other derivatives' will be explained and applications will be demonstrated.

FIN 410 – Derivative Markets (3)
Functions, techniques, and impact of speculation conducted through forward markets; the nature of speculative transactions, pricing, and methods of trading.

FIN 408 – Financial Markets and Institutions (3)
Functional analysis of major credit institutions; sources and uses of funds; impact of government regulation.

FIN 597B – Topics in Finance (4)
This course covers selected topics in Finance. Students will analyze topics such as risk management, usages of derivatives, investment policies, risk and return for financial assets, firm valuation, and capital structure. The topics may change from year t

FIN 596 – Individual Studies (1)
Creative projects, including nonthesis research, which are supervised on an individual basis and which fall outside the scope of formal courses.

FIN 597A – Topics in Finance (3)
This course covers selected topics in Finance. Students will analyze topics such as risk management, usages of derivatives, investment policies, risk and return for financial assets, firm valuation, and capital structure. The topics may change from year t

FIN 601 – PH.D. DISSERTATION FULL-TIME
NO DESCRIPTION.

FIN 581 – Fundamentals of Financial Markets (2)
Operation, structure of money, bond markets and concepts; and techniques used in evaluating and managing fixed income portfolios.

B A 597I – Independent Study (1)
Formal courses given on a topical or special interest subject which may be offered infrequently.

Selected Publications

Kracaw W., Kini O., Mian S., "The Nature of Discipline by Corporate Takeovers." Journal of Finance, vol. 59, no. 4, 2004
Kracaw W., Campbell T., "Optimal Speculation Under Costly External Finance." Corporate Risk Management: Theory, Practice and New Development, (Risk Publications), 1999
Kracaw W., Ze M., "The Wealth Effects of Bank Financing Announcements in Highly Leveraged Transactions." Journal of Finance, 1996
Kracaw W., Kini O., Mian S., "Corporate Takeovers, Firm Performance, and Board Composition." Journal of Corporate Finance, 1995
Kracaw W., Lewellen W., Woo C., "Corporate Growth, Corporate Strategy, and Choice of Capital Structure." Managerial and Decision Economics, 1992
Kracaw W., Campbell T., "Financial Intermediation and the Market for Interest Rate Swaps." Journal of Financial Intermediation, 1991
Kracaw W., Kini O., McConnell J., "Corporate Takeovers and Interest Rates." Journal of Applied Business Research, 1991
Kracaw W., Johnston E., McConnell J., "Day-of-the-Week Effects in Financial Futures Markets: An Analysis of GNMA, T-Bond, and T-Bill Futures Markets." Journal of Financial and Quantitative Analysis, 1991
Kracaw W., Campbell T., "Corporate Risk Management and the Incentive Effects of Debt." Journal of Finance, 1990
Kracaw W., Campbell T., "Bank Funding Risks, Risk Aversion and the Choice of Futures Hedging Instrument: Comment." Journal of Finance, 1990
Kracaw W., Lewellen W., "Inflation, Corporate Growth and Corporate Leverage." Financial Management, 1987
Kracaw W., Campbell T., "Optimal Managerial Incentive Contracts and the Value of Corporate Insurance." Journal of Financial and Quantitative Analysis, 1987
Kracaw W., Blum G., Lewellen W., "The Execution Costs of Common Stock Trades by Individual Investors." Journal of Financial Research, 1986
Kracaw W., Campbell T., "The Market for Managerial Labor and Capital Markets Equilibrium." Journal of Financial and Quantitative Analysis, 1985
Kracaw W., Huang R., "Stock Market Returns and Real Activity: A Note." Journal of Finance, 1984
Kracaw W., Campbell T., "Information Production, Market Signalling, and the Theory of Financial Intermediation: Reply." Journal of Finance, 1982
Kracaw W., Campbell T., "Sorting Equilibria in Financial Markets: The Incentive Problem." Journal of Financial and Quantitative Analysis, 1981
Kracaw W., Campbell T., "Information Production, Market Signalling, and the Theory of Financial Intermediation." Journal of Finance, 1980

Editorship

Journal of Managerial Issues, Editorial Board, September 1990 - Present

Honors and Awards