Ilona Babenka

BAC 540
W.P. Carey School of Business
Associate Professor
TEMPE Campus


Ilona Babenko joined the W. P. Carey School of Business as an assistant professor of finance in 2009.

Babenkos research and teaching interests are in compensation design, corporate playout and financing policies, insider training and information economics, real options, and effects of competition on corporate policies. Her most recent research paper, titled The Credibility of Open Market Share Repurchase Signaling examines how executives who buy shares of their firm before an announcement add credibility to the undervaluation signal. Babenko and her fellow researchers argue that announcement returns are positively related to past insider purchases, especially for firms that are prices less efficiently.

Before joining W. P. Carey, Babenko was an assistant professor of finance at the Hong Kong University of Science and Technology. She received her bachelors degree in physics from Belarus State University, her masters degree in physics from the University of Minnesota, and her PhD in finance from the University of California, Berkeley.

Babenko has been recognized for her achievements in academia and research, including the 2012 Fidelity Fellowship in Equity Compensation Research, the J. Robert Beyster Faculty Fellowship, and the 2009 HKUST Recognition for Teaching Excellence. She has published several articles in academic and practitioner journals, including the Journal of Finance and Quantitative Analysis


PhD  University of California at Berkeley, 2006

MS  University of Minnesota, 2001

BS  Belarus State University, 1999

Research Interests

  • Compensation Design
  • Corporate Payout
  • Financing Policies
  • Insider Trading
  • Information Economics
  • Real Options
  • Effects of Competition on Corporate Policies


“Idiosyncratic Cash Flows and Systematic Risk,” with Oliver Boguth and Yuri Tserlukevich, 2016, Journal of Finance 71, 425-456.

“Do Non-Executives Employees Have Information? Evidence from Employee Stock Purchase Plans” with Rik Sen, 2016, Management Science 62, 1878–1898.

“Money Left on the Table: An Analysis of Participation in Employee Stock Purchase Plans,” with Rik Sen, 2014, Review of Financial Studies 27, 3658-3698.

“The Credibility of Open Market Share Repurchase Signaling” with Yuri Tserlukevich and Alexander Vedrashko, 2012, Journal of Financial and Quantitative Analysis 47, 1059-1088.

“Employee Stock Options and Investment,” with Michael Lemmon and Yuri Tserlukevich, 2011, Journal of Finance 66, 981-1010.

“Share Repurchases and Pay-Performance Sensitivity of Employee Compensation Contracts,” 2009, Journal of Finance 64, 117-151.

“Analyzing the Tax Benefits from Employee Stock Options” with Yuri Tserlukevich,” 2009, Journal of Finance 64, 1797-1825.

“Market Timing with CAY” with Sandro Andrade and Yuri Tserlukevich,” 2006, Journal of Portfolio Management 32, 70-80.


Research Activity

  • "Real Investment with Financial Hedging", with Yuri Tserlukevich
  • "Agency Implications of Equity Market Timing", with PengCheng Wan and Yuri Tserlukevich
  • "Adverse Selection and Stock-Based Grants to Non-Executive Employees”


Spring 2017
Course NumberCourse Title
FIN 361Advanced Managerial Finance
FIN 782Theory of Finance II
Spring 2015
Course NumberCourse Title
FIN 361Advanced Managerial Finance
FIN 782Theory of Finance II
Spring 2014
Course NumberCourse Title
FIN 361Advanced Managerial Finance
FIN 782Theory of Finance II
Spring 2013
Course NumberCourse Title
FIN 361Advanced Managerial Finance
FIN 782Theory of Finance II


  • AFA 2014 in Philadelphia, FIRS in Quebec City (scheduled), Rochester University* (scheduled), University of Maryland* (scheduled), Georgia State Finance Symposium (scheduled)
  • WFA 2013, EFA 2013 in Oxford, AFA 2013 in San Diego, Stanford University*, UC Berkeley*, Financial Intermediation Research Society* (FIRS) 2013 in Dubrovnik, Tilburg University, Erasmus University, University of Minnesota*, IE Business School 
  • EFA 2012 in Copenhagen*, UBC Winter Finance Conference, University of Southern California conference, Leland-Rubinstein UC Berkeley conference, Financial Intermediation Research Society* (FIRS) in Minneapolis, Texas A&M University, CAF Indian School of Business Research Conference 2012, Purdue University, Simon Fraser University, Copenhagen Business School, New Economic School 20th Anniversary Conference, BI Norwegian School of Management
  • University of Michigan, Australian National University Summer Camp*, Beyster Ownership Symposium, Caesarea Center 8th Annual Conference at IDC 2011, University of Washington St. Louis*, AFA 2011 in Denver, Finance Down Under Conference 2011 in Melbourne, Nanyang Technological University, Singapore Management University, National University of Singapore, Oklahoma Risk Management Conference*, University of Hong Kong*, HKUST*, UNSW*, University of Sydney*, UT Sydney
  • 2009 Carnegie Mellon University, CAF Indian School of Business Research Conference, New Economic School, Simon Fraser University, University of Arizona
  • AFA 2009 in San Francisco, University of Colorado at Boulder, University of Florida, HEC University of Lausanne, Arizona State University, University of Michigan*, University of Southern California
  • 2008 EFA 2008 Greece, University of Miami, UBC Winter Finance Conference*, Cornell University
  • University of Utah*, University of Lausanne*, University of North Carolina Tax Symposium, University of South Carolina, University of Wisconsin, Madison, UC Berkeley, FMA Conference Orlando Top 10% Section*, City University of Hong Kong*, HKUST Symposium, Australian National University, Nanyang Technological University, Notre Dame University, HKUST, Hong Kong University, National University of Singapore, Melbourne Business School, York University, NHH Bergen, Stockholm School of Economics, Universitat Pompeu Fabra


  • CERG Competitive Research Grant (HK$480,000)
  • RPC Competitive Research Grant (HK$150,000)
  • DAG Research Grant (HK$100,000)
  • Best Teaching Award, 2003, (Masters of Financial engineering program), University of California, Berkeley


Fidelity Investments: Design of ESPP plans