Business Commons^™

Does The Presence Of Foreign Investors Affect Financial Reporting Quality In Philippine Publicly Listed Firms?, Natasha Amber Y. Cabiltes, Megan Justine Siao Beltran, John Miguel Roger Dela Cruz Benito, Gianna Zenovia Domingo Agaton, Mariel Monica R. Sauler, Angelo A. Unite

Angelo King Institute for Economic and Business Studies (AKI)

Reinstate accounting conservatism in the Conceptual Framework – Our findings should be of interest to accounting standard setters, given the ongoing debate on the necessity for accounting conservatism as a characteristic for useful financial statements after its initial removal from the conceptual framework in 2010. While there are arguments that conservatism violates the neutrality of financial reports, further discussions show that conservatism can give a more faithful representation of firm performance (Cooper, 2015; International Accounting Standards Board, 2018).

An On-Ramp To Financial Inclusion: Measuring The Impact Of Mercy Corps' Community Investment Trust Program On Minority Investors, Lexi Yokote

University Honors Theses

Mercy Corps' Community Investment Trust (CIT) was launched in 2017 as a low-risk real estate investment and education initiative. The program is now working to replicate this in cities across the United States. However, it has not been able to collect much feedback from existing investors about their experiences and needs. This paper will use primary and secondary research in the form of a literature review and original surveys to collect information about investor demographics, attitudes toward the CIT and investing, risk perceptions, and future investment plans. The results show that U.S.-born versus foreign-born status, ethnicity, and gender affect the …

A Psychological Profile Of The Digitized Economy: Who Buys Cryptocurrencies, Nfts, And Meme-Stocks (And Why)?, Nicole Wolfe

Undergraduate Student Research Internships Conference

As the global digital economy continues to grow in interest and financial worth, it is imperative to harvest data to gain early information on this nuanced economy. Already, we have witnessed billions of dollars in losses and wins at the blink of an eye, encouragement to invest from well-known celebrities and politicians, and high anxiety from the newness, power consumption, and potential outcomes of this nuanced system. Stemming from the lack of solid evidence in this emerging field, we hope to gain more insight on the early players and variation within the digitized economy. Similarly, we hope to identify specific …

Three Chapters On Investments And Financial Institutions, Cao Fang

Graduate Theses and Dissertations

Only the stock selection (“alpha”) decisions of fund managers who trade on firm-specific information should have predictive return content. Faced with the same information, skilled fund managers make similar stock selection decisions. In Chapter one, we introduce a new measure - stock investment quality - which uses fund quality to weight asymmetries in private information reflected in deviations of fund from peer group ownership on stocks in a style segment. We show stocks ranked high on investment quality generate significantly higher excess returns that persist through the ensuing year. The positive investment quality–future return relationship is robust to alternative fund …

Frameworks Used To Measure The Societal Influences & Effectiveness Of Impact Investing, Mya E. Baptiste

Senior Honors Projects, 2020-current

The purpose of this thesis is to learn how capital generates positive returns for society through impact investing. I address the different forms of impact investments along the spectrum and examples of companies that are grouped into each category. Afterward, I highlight the various pre-existing frameworks being used by the industry to properly measure their social returns and then provide insight into my personal experience working with Citigroup, Inc. Impact Fund. This paper includes an empirical study to address my hypothesis that companies who invest in producing social returns receive a positive impact on their financials. It was concluded that …

Cryptocurrencies: A Craze Or Crazed?, Jesse L. Veenstra

Faculty Work Comprehensive List

"The craze of Bitcoin and the headlines of massive gains test the diligence and patience of investors."

Posting about ­­­­­­­­the benefits and pitfalls of cryptocurrencies from In All Things - an online journal for critical reflection on faith, culture, art, and every ordinary-yet-graced square inch of God’s creation.

https://inallthings.org/cryptocurrencies-a-craze-or-crazed/

Monte Carlo And Bootstrapping Carry Trade Simulations In Excel, Tom Arnold, C. Mitchell Conover, Joseph Farizo

Finance Faculty Publications

In a currency carry trade, an investor borrows money in a low interest rate currency and invests in a high interest rate currency. The trade is profitable if the future exchange rate does not adjust to the interest rate differential. After downloading exchange rate data, a Monte Carlo simulation of a carry trade is performed in Excel based on a normal distribution and the data’s mean and standard deviation. A bootstrapping carry trade simulation exercise is also generated by randomly selecting observations from the historical data. In contrast to the Monte Carlo simulation, the bootstrapping exercise preserves the skewness within …

Cost Of Capital For Small Size Tourism Industry In Developing Countries: The Case Of Lodging Sector In Chile, Sergio Zuniga-Jara, Karla Soria-Barreto

Journal of Hospitality Financial Management

This paper provides a simplified approach toward estimating the cost of capital for a small company of the tourism sector. This is accomplished by dividing the hurdle rate into the return of the specific industry in a specific country, and a specific risk premium dependent on the size and age of the company/projects. We illustrate our proposal with investment estimations in lodging accommodations along the northern coast of Chile where tourism represents an important source of income and jobs. The estimations were validated through a survey carried out among entrepreneurs of the sector. The results suggest that our method is …

Making Money From Cryptocurrency? The Taxman May Call On You, Hern Kuan Liu, Vincent Ooi

Research Collection Yong Pung How School Of Law

Miners, forgers, hobbyists, traders – different rules apply. Just don’t assume crypto investment is somehow immune to taxation.

Investment Patterns In Mountain West States, Counties, And Nevada Cities 2005-2019, Peter Grema, Zachary Walusek, Katie M. Gilbertson, William E. Brown Jr.

Economic Development & Workforce

The purpose of this fact sheet is to summarize findings on capital flows across Mountain West states and counties, and within Nevada cities. The “Gauging Investment Patterns across the US” report by the Urban Institute present findings of overall volume of capital deployed, racial equity of investments, and income equity for each respective geographic area. The full report further breaks down these three main categories into 18 other metrics.

Analysis Of Key Factors That Impact Large Cap Us Firms’ Financial And Market Performance At Different Phases During The 2007- 8 Financial Crisis, Ken Lobo

Doctoral Dissertations (DBA)

The financial crisis of 2007-8 provides an opportunity to investigate which factors have a significant impact on firms at different stages of the crisis. This paper considers this shock event along these lines: impact of leverage on a firm can vary depending on timing of the crisis; firm are challenged to invest as the crisis recedes; revenue growth can enhance and sometimes impede returns; choosing to hold cash or not when a firm make the trade-off with investment and both the timing and decision are important; investors, managers and shareholders perceive these actions and events differently. Large cap US firms …

Essays In Investments, Lina Han

Arts & Sciences Electronic Theses and Dissertations

Over the past decade, the asset management industry has experienced significant changes, with exponential growth due to the demand from individual investors. Within this context, my dissertation focuses on studying both individual and institutional investors’ behaviors. In Chapter 1, I study individual investors’ behaviors on the Alipay platform. I use unique, individual transaction data from a trading experiment implemented through the Alipay app and the same individuals’ trading history in the financial market. In response to the exogenous price movements in the experiment, investors tend to be contrarian traders. The sophisticated investors tend to be more contrarian than the less …

Diversifying Investment Portfolios With Collectible Sneakers: Expected Returns And Benefits Of Diversification, Samuel Soo

CMC Senior Theses

This thesis seeks to identify if collectible sneakers can provide diversification benefits to an investor’s portfolio. Using data from a global collectible sneaker marketplace, StockX, I constructed an index to compare it with other traditional assets, including the S&P 500 index and 5-year US Treasury Bills. By calculating key metrics including expected returns, volatility, and correlation, I analyzed the risk-return characteristics of the collectible sneaker asset class compared to other traditional asset classes. From the data analysis I performed, I found that collectible sneakers did not outperform returns significantly compared to traditional asset classes, but had low correlations, which provides …

Essays On Investments And Real Estate Finance, Shahedur Rahaman Chowdhury

Theses and Dissertations

Essay I examines the role of macroeconomic fundamentals in explaining the explosive behavior or price exuberance in the US local housing markets. Using monthly observations between November 1997 and December 2016 we employ the double recursive approach from Philips et al., (2015) to identify the emergence of price exuberance in each of the 291 U.S. Metropolitan Statistical Areas in the sample. Our estimations results show that population and income per capita have a significant positive effect on price exuberance, while unemployment rate and fixed mortgage interest rate have a negative effect. The marginal impacts of these macro fundamentals on housing …

Equity Crowdfunding In The United States: Evolution, Determinants And Performance, Kenny Ozuna

Theses and Dissertations

In recent years, equity crowdfunding has developed into an alternative form of early stage financing for startup firms. The main purpose of this dissertation is to understand the evolution, process and regulation of equity crowdfunding in the United States as well as assess the determinants of a successful campaign and whether this capital market lead to an enduring business.

The first essay examines the evolution, process and regulation surrounding equity crowdfunding. I establish a clear definition of crowdfunding and its restructuring of the music industry to establishing an alternative form of raising capital for nascent firms via equity crowdfunding. I …

Financial Advisory Firms’ Strategies For Diversifying And Growing Clients’ Portfolio, Gerald Lee House

Walden Dissertations and Doctoral Studies

Abstract

Less than half of all U.S. households have some form of retirement assets. Advisors who fail to use alternative investment strategies may not accumulate enough retirement assets for their clients. Grounded in Markowitz's modern portfolio theory, the purpose of this qualitative multiple case study was to explore alternative investment strategies financial advisors use to enhance the growth and diversification of their clients' retirement assets. Data were collected from semistructured interviews and company documents from 4

financial advisors in Georgia and South Carolina who had successfully incorporated alternative investments in their clients' retirement portfolios. Thematic analysis was used to analyze …

The Value Perspective: The Case Of Warren Buffet And His Investment Behavior Towards Apple, Walmart And Amazon, Shanhong Wu, Kermit Kuehn, Jing Jiang

WCBT Faculty Publications

In this paper, we use metrics of Ben Graham’s value investing principle to examine the actions taken by Warren Buffet toward three prominent stocks: Amazon, Apple and Walmart. We find that decisions of investment/dis-investment and not-investment by Buffet toward the stocks are largely in line with Graham’s view on value investing. This paper provides in-depth analysis of value for three stocks and relates to research on the book-to-market anomaly in the finance literature.

Essays On Investments, Michael Farrell

Theses and Dissertations--Finance and Quantitative Methods

The first chapter studies mutual funds. I model intraquarter trading and use a genetic algorithm to estimate the trade pattern that is most consistent with the fund's daily reported returns. I validate the model empirically on a sample of institutional trades from Ancerno and I confirm that the method more accurately predicts daily holdings when compared to existing naive assumptions. Further, my method is substantially more accurate in classifying a fund's tendency to supply liquidity, and this increased precision has important implications for identifying superior performing funds. Specifically, a long-short strategy based on the model's liquidity provision measures earns significant …

Benefits Of Relationship Banking: Evidence From Consumer Credit Markets, Sumit Agarwal, Souphala Chomsisengphet, Chunlin Liu, Changcheng Song, Nicholas S. Souleles

Research Collection Lee Kong Chian School Of Business

Using a unique panel dataset that contains comprehensive information about the relationships between a large bank and its credit card customers, we show that relationship accounts exhibit lower probabilities of default and attrition, and have higher utilization rates, than non-relationship accounts. Dynamic information about changes in the behavior of a customer's other accounts at the same bank helps predict the behavior of the credit card account over time. These results imply that relationship banking offers significant potential benefits to banks: information the lender has at its disposal can be used to mitigate credit risk on the credit card account.

An Investment Guide For Millennials, Joshua Perkins

Senior Honors Projects

While almost a majority of Gen Xers and Baby Boomers invest in the stock market, only a mere one-third of Millennials invest. In today’s economy, Millennials experience a range of financial challenges, including student debt, rising rents, and lower starting salaries. A recent study has found that the average retirement age for Millennials will be 75 years old, 10 years older than the average retirement age today. Most young adults do not realize the importance of saving, investing early, and the power of compounding returns in order to be more financially stable in the future.

Over the course of my …

Director Networks And Credit Ratings, Bradley W. Benson, Subramanian R. Iyer, Kristopher Kemper, Jing Zhao

Business Faculty Publications and Presentations

We explore the effect of director social capital, directors with large and influential networks, on credit ratings. Using a sample of 11,172 firm‐year observations from 1999 to 2011, we find that larger board networks are associated with higher credit ratings than both firm financial data and probabilities of default predict. Near‐investment grade firms improve their forward‐looking ratings when their board is more connected. Last, we find that larger director networks are more beneficial during recessions, and times of increased financial uncertainty. Our results are robust to controls for endogeneity. Tests confirm that causality runs from connected boards to credit ratings.

Anticipation And Reaction To Going Concern Modified Audit Opinions By Sophisticated Investors, Marshall A. Geiger, Abdullah Kumas

Accounting Faculty Publications

The purpose of this paper is to examine whether institutional investors (i) anticipate a distressed firm's receipt of a first‐time going‐concern modified audit opinion, and (ii) react to a first‐time going‐concern modified opinion by engaging in abnormal net selling of firm shares. Using a proprietary database of US institutional investor trades, we find that institutional investors are net sellers of first‐time going‐concern opinion firms beginning 6 months before the release of the report and remain net sellers through the subsequent 3 months. We also find that the severity of the reasons auditors modify their opinions is associated with increased trading …

Additional Evidence On The Impact Of The International Financial Reporting Standards On Earnings Quality: Evidence From Latin America, Mauricio Melgarejo

Scholarship and Professional Work - Business

The purpose of this paper is to explore whether the adoption of the International Financial Reporting Standards (IFRS) has an impact on the quality of earnings in Latin America. Studying a sample offirms from Argentina, Brazil, Chile, Mexico, and Peru, I find that management reports a lower level of discretionary accruals after the implementation of the IFRS. In addition, this study provides evidence that earnings are more persistent and stock prices are more associated with earning numbers after the application of IFRS. This paper provides evidence that earnings quality has increased after the adoption of IFRS in Latin America.

Additional Evidence On The Impact Of The International Financial Reporting Standards On Earnings Quality: Evidence From Latin America, Mauricio A. Melgarejo

Mauricio Melgarejo

Financing Strategies For Real Estate Investments, Joshua Parr

Williams Honors College, Honors Research Projects

Most people have a dream of being financially independent and in order to do so it is necessary to save and invest their money. The key is to invest wisely so that one can earn a solid return on their money. Real estate investments are a great way to build wealth because of the benefits they have over other investments. Many are under the misconception that they cannot invest in real estate because of a lack of capital. This belief is entirely untrue and there are dozens of different strategies for investing in real estate with little or no capital …

Cultural Influnces On Risk Tolerance And Portfolio Creation, Mark K. Pyles, Yongping Li, Shifang Wu, Steven D. Dolvin

Scholarship and Professional Work - Business

We extend existing research that examines the impact of culture on risk tolerance. Using surveys completed by Chinese and American students, we find, consistent with previous studies, that Chinese students perceive themselves as more risk tolerant. However, we find that Chinese students are less consistent in matching their perceived tolerance levels with actual scores from a standard risk tolerance assessment. Further, we also examine mock portfolios created by the respondents and find no evidence that Chinese students create portfolios that are riskier than their American counterparts. Our findings suggest that differences in risk tolerance are at least partially a product …

Ipo Underpricing: The Owner’S Perspective, Steven Dolvin

Steven D. Dolvin

Most corporate finance textbooks include a chapter on raising capital, giving particular attention to initial public offerings (IPOs). For IPOs, underpricing is defined as the percentage change from the offer price to the closing price on the first trading day. Textbooks universally treat underpricing as the indirect cost of issuance; however, this fails to account for the share issuance decision. Because owners do not typically sell all (or even most) of their shares, underpricing overstates the wealth lost by preexisting owners. I provide simple, real-life examples for instructors to use in courses such as corporate finance, entrepreneurship, or alternative investments.

New Student Investment Club Launches

Bridget Lyons

Sacred Heart University has launched a new extracurricular student venture where return on investment IS the return on investment! The mission of the SHU Student Investment Club will be to engage students—under the watchful guidance of faculty and professional financial advisers—to make prudent financial investments aimed at enriching the University’s endowment while teaching valuable skills and providing practical hands-on experiences.

How Large Are The Benefits Of Emerging Market Equities?, C. Mitchell Conover, Gerald R. Jensen, Robert R. Johnson

Finance Faculty Publications

We perform a comprehensive evaluation of the benefits of emerging market equities by extending previous research in four fundamental ways. The contribution of this study is that it 1) evaluates a more complete sample; 2) examines performance measures that account for asymmetric return distributions; 3) separates emerging markets by region; and 4) considers the influence that the market environment has on the benefits of emerging market investments. Our results suggest that previous research has understated the benefits associated with investing in emerging markets. We find that broad emerging market indices have relatively low downside risk, which results in Sortino ratios …

Risk Aversion And Former Collegiate Athletes As Financial Investors, Tyler Buccetti

Honors Thesis Program in the College of Management

Risk aversion is a concept that tries to understand an individual’s choice, when two options are presented with different levels of risk and reward. This concept can be applied to finance when looking at investors decisions to invest in options with different levels of risk and returns. This study examines if having played a collegiate sport will impact the level of risk aversion an investor has. In order to determine this, an experiment was given to Graduate students working on a Master’s degree in business. The experiment consisted of six different stock options representing different levels of risk. From this …