The matching principle states that a firms short-term needs should be financed with short-term debt and long-term needs should be financed with long-term sources of funds.

What do you think of the evidence reported in Grundy and Verwijmeren (2019) with respect to the matching principle? Are the results in line with the matching principle? Discuss briefly.

The paper can be downloaded from:

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2986127