Assuming that paul is adverse to risk and that his only


Suppose Pablo wants to invest in the shares of a new company. He is contemplating two different companies. The first is Trinity Industries (TRN), a railway company based in Texas, USA. Within the list of shareholders of TRN is ValueAct Capital, an investment fund whose principle is to maintain its shares for at least 4 years and follow an activist investor policy. The second one is ETSY Inc. (ETSY), a young company in the online wholesale sector. Unlike TRN, ETSY does not have activist investors. Pablo wants to invest a small amount so that regardless of the company he chooses he will end up being a minority shareholder. Assuming that Paul is adverse to risk and that his only decision criterion is the corporate governance system of the company, which of the two companies would he choose and why?

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Financial Management: Assuming that paul is adverse to risk and that his only
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