Using data from a new hedge fund database, we examine the impact of social networks on the return comovement of stock hedge funds in China. We use structural holes in the college alumni networks of managers to measure the managers' social network positions. We perform an empirical analysis on a sample of 3,012 hedge fund products in China from 2010 to 2017. We find that greater structural holes are associated with higher return comovement. The positive impact of the structural holes on return comovement is not affected by market cycles, a manager's major in college, or his or her abilities.

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Institutional economists believe that language, as an important informal institution, has a significant impact on economic activities. However, the study of language on corporate behavior is still relatively insufficient. Our paper examines the influence of linguistic distance between the acquirer and the target firm on M&A performance in China, from 2000 to 2012. The results indicate that the linguistic distance between the acquirer and the target firm significantly reduces the performance of M&As. Furthermore, we suggest that the influence of language differences on the performance of M&As is mainly driven by the cultural effect rather than the communication effect. In addition, we find that the relationship between language differences and M&A performance is affected not only by manager characteristics, types of mergers and corporate ownership structures, but also by regional development. This paper provides a new way to examine management's participation in M&A activities from the perspective of language.