Finance and Financial Management Commons^™

The Information Content Of Sudden Insider Silence, Claire Yurong Hong, Frank Weikai Li

Research Collection Lee Kong Chian School Of Business

We present evidence of investors underreacting to the absence of events in financialmarkets. Routine-based insiders strategically choose to be silent when they possessprivate information not yet reflected in stock prices. Consistent with our hypothesis,insider silence following routine sell (buy) predict positive (negative) future return aswell as fundamentals. The return predictability of insider silence is stronger amongfirms with poor information environment and facing higher arbitrage costs, and alarge fraction of abnormal returns concentrates on future earnings announcements. Along-short strategy that exploits insiders’ strategic silence behavior generates abnormalreturns of 6% to 10% annually

Product Categories As Judgment Devices: The Moral Awakening Of The Investment Industry, Diane-Laure Arjaliès, Rodolphe Durand

Business Publications

Product categories are more than classification devices that organize markets; when reflecting market actors' purposes, they are also judgment devices. Taking stock of the literature on product categories and drawing on the distinction between the faculties of knowing and judging, we elaborate a framework that accounts for how and why market actors include or exclude normative attributes in a product category definition. Based on a field study of the development of Socially Responsible Investment (SRI) funds in France, we describe the phases and conditions of a judgment framework for category definition, for both established and nascent categories. We discuss implications …

Forecasting In Blockchain-Based Local Energy Markets, Michael Kostmann, Wolfgang Karl Hardle

Sim Kee Boon Institute for Financial Economics

Increasingly volatile and distributed energy production challenges traditional mechanisms to manage grid loads and price energy. Local energy markets (LEMs) may be a response to those challenges as they can balance energy production and consumption locally and may lower energy costs for consumers. Blockchain-based LEMs provide a decentralized market to local energy consumer and prosumers. They implement a market mechanism in the form of a smart contract without the need for a central authority coordinating the market. Recently proposed blockchain-based LEMs use auction designs to match future demand and supply. Thus, such blockchain-based LEMs rely on accurate short-term forecasts of …

International Welfare Spillovers Of National Pension Schemes, James Staveley-O'Carroll, Olena Staveley-O'Carroll

Economics Department Working Papers

We employ a two-country overlapping-generations model to explore the international dimension of household portfolio choices induced by the asymmetric provision of government-run pensions. We study the resulting patterns of risk-sharing and the corresponding welfare effects on both home and foreign agents. Introducing the defined benefits pay-as-you-go system at home increases the welfare of all other agents at the expense of the home workers and improves the degree of intergenerational risk sharing abroad. Conversely, a defined contributions system leads to welfare losses of both home cohorts accompanied by gains abroad, but does increase the extent of intergenerational risk sharing at home.

Incumbency Or Innovation: Why A Collective Agency View Of Cross-Border Payments Means Private Blockchains Cannot Prevail, Boaz B. Goldwater

Cornell International Law Journal

The abstract below was generated using an artificial intelligence tool. It has not been endorsed by the author.   This Note examines the global cross-border payments system through the lens of collective action theory, arguing that the Society for Worldwide Interbank Financial Telecommunication (SWIFT) functions not merely as a financial messaging network but as a collective agent essential to the stability and legitimacy of international finance. While technological innovations—particularly blockchain-based platforms such as Ripple—promise improvements in speed, cost, and efficiency, the author contends that these advantages alone are insufficient to supplant SWIFT. The cross-border payments system requires not only technical functionality …

College Of Business Dean's Report: 2018-2019, Ryan Butt

College of Business Dean’s Reports

No abstract provided.

How Equitable Is The Education Finance System In New York State?, John Yinger

Center for Policy Research

This policy brief provides an overview and evaluation of the education finance system in New York State. The brief addresses four broad topics: student performance disparities in New York State, the nature of the New York State education finance system, the contributions of the New York foundation aid formula to educational equity, and the benefits to all taxpayers in New York State from education finance reform.

Credit Ratings And The Cost Of Issuing Seasoned Equity, Garrett A. Mcbrayer

Finance Faculty Publications and Presentations

I examine the effects of issuer credit ratings on the costs associated with seasoned equity offerings (SEOs). The evidence from a panel of SEOs from 1990 to 2014 shows that when firms issue seasoned equity, those with issuer credit ratings pay reduced investment banking fees. I confirm these results by conducting a propensity-score matched-sample comparison analysis of firms that obtain new, long-term issuer credit ratings with an unrated control group. Controlling for known determinants of SEO fees, I find that firms that obtain a new credit rating before issuing seasoned equity pay significantly reduced investment banking fees. In economic terms, …

Two Essays On Investor Attention, Investor Sentiment, And Earnings Pricing, Qiuye Cai

Theses and Dissertations in Business Administration

This dissertation proposes novel direct measures for both firm-level and market-level investor attention and investor sentiment and provides new empirical evidence on the effects of investor attention and investor sentiment on earnings pricing.

The first essay proposes novel direct measures for both market-level and firm-level attention using user activity data from StockTwits.com. To the best of my knowledge, this is the first direct measure of market-level attention. By measuring market-level and firm-level attention separately, I am be able to not only distinguish between attention allocated on market level and firm level but also detach attention from equilibrium outcomes. I document …

Two Essays On Bitcoin Price And Volume, Mohammad Bayani Khaknejad

Theses and Dissertations in Business Administration

Bitcoin is a decentralized peer to peer digital transactions system that was introduced in 2009 in the aftermath of the financial crisis. Since its introduction, it has had a volatile journey, being adopted by computer programmers, cyber punk enthusiasts, criminals, and financial investors. While the future of bitcoin is still not clear, it has been widely adopted by many, not necessarily as a new method of transactions, but rather as a new investment vehicle. Being a new asset class, there are many unknown financial characteristics to be investigated about bitcoin and in this dissertation, we try to explore two of …

Role Of Financial, Human And Social Capital In Survival Of Start-Ups, Tiong Kiat Wong

Dissertations and Theses Collection (Open Access)

In new business ventures, growth in itself is often not the main intention in the beginning, but rather a mean to ensure survivability first, follow by sustainability and secure profitability. Not all small businesses survived over time and are always confronted with the liability of newness and contending externalities such as fierce competition and internal limitations like resources to survive. Only about half of newly founded start-ups survived after 5 years.

The presence or absence of resources and the critical role it plays on the effect of venture’s survival, provides substantive advancement in understanding of organisational theory and management practice …

Momentum And Reversal: The Role Of Short Selling, Zhaobo Zhu, Xinrui Duan, Licheng Sun, Jun Tu

Research Collection Lee Kong Chian School Of Business

This paper investigates the relation between short selling and momentum. We document that a consistent momentum strategy that buys lightly shorted winners and sells heavily shorted losers exhibits strong short-term momentum and no long-term reversal. In contrast, an inconsistent momentum strategy that buys heavily shorted winners and sells lightly shorted losers experiences weak short-term momentum and persistent long-term reversal. Our results are robust after controlling for firm characteristics, proxy for short-sale constraints, and investor sentiment, as well as an exogenous shock (the Taxpayer Relief Act of 1997). These findings present a new challenge to existing theories of momentum that rely …

Tail Risk Concerns Everywhere, George P. Gao, Xiaomeng Lu, Zhaogang Song

Research Collection Lee Kong Chian School Of Business

We show that the beta with respect to an index of global ex ante tail risk concerns (��ℝ����), which we construct using out-of-the-money options on multiple global assets, negatively drives cross-sectional return variations across asset classes, including international equity indices, foreign currencies, and government bond futures. The pricing power of ��ℝ���� becomes stronger when more asset-class-level tail risk concerns are incorporated in the index construction. ��ℝ���� also dominates asset-class-level tail risk concerns in pricing assets within each asset class. These evidences imply that the pricing effect of tail risk concerns works predominantly as a global channel. The ��ℝ���� pricing effect …

Gilgit-Baltistan At The Cross Road Of China-Pakistan Economic Corridor (Cpec), Zulfiqar Ali Khan

MSJ Capstone Projects

This capstone project focused on the in-depth analysis of the role and impact of this multi-billion-dollar project on the politically deprived region of Gilgit-Baltistan. This region is the gateway to CPEC as it is the only region of Pakistan that shares border with China. The geographical ties, tributary and trade relationship and even family relationships between Gilgit-Baltistan and the Xinjiang region of China dates back centuries before the creation of Pakistan and the post revolution China.

The project has been designed and implemented in a way that GB’s role is to provide the services of road and some other services …

When Soft Law Meets Hard Politics: Taming The Wild West Of Nonprofit Political Involvement, Lloyd Hitoshi Mayer

Journal of Legislation

Beginning in the 1990s and continuing today, many of the legal and psychological barriers to nonprofits becoming involved in electoral politics have fallen. At the same time, political divisions have sharpened, causing candidates, political parties, and their supporters to scramble more aggressively for any possible edge in winner-take-all political contests. In the face of these developments, many nonprofits have violated the remaining legal rules applicable to their political activity with little fear of negative consequences, especially given vague rules and a paucity of enforcement resources. Such violations include under reporting of political activity in government filings, fly-by-night organizations that exist …

Collectivism And The Costs Of High Leverage, Sadok El Ghoul, Omrane Guedhami, Chuck C.Y. Kwok, Ying Zheng

Finance Department Faculty Journal Articles

Prior literature shows that high leverage is associated with losses in market share due to unfavorable actions by customers and competitors. Building on this literature, we investigate the effect of collectivism on the product market performance of highly leveraged firms. Using a sample of 46 countries over the 1989–2016 period, we find significantly lower costs of high leverage for countries with higher collectivism scores. Moreover, we find that the impact of collectivism on high leverage costs is more pronounced for firms with high product specialization and with financially healthy rivals. In additional analysis, we find that collectivism helps highly leveraged …

Evaluating The Effect Of Corporate Tax Reductions On Value Chain Sourcing Decisions, James Mohs, Arthur Galloway

Accounting Faculty Publications

The objective of this paper is to evaluate the changes in the elements of the value change sensitivity model and identify if there has been a significant shift in the profitability of one country to another. Validating the work on the adjusted present value (APV) formula provided by Rainish, Mensz, and Mohs (2015), this paper analyzes how the new U.S. corporate tax rates will impact a company’s sourcing decision. Also, the value-added tax (VAT) is used in all other OECD countries, except the U.S, and therefore this will be part of the evaluation. The third variable that has a crucial …

Security Token Offerings: The Next Big Thing?, Singapore Management University

Perspectives@SMU

CUHK expert shares insights on whether Security Token Offerings will be the next trend in cryptocurrency community

Executive Leadership Challenges In Today’S Environment, Herbert J. Degraffe Jr.

Walden Faculty and Staff Publications

Abstract

Individuals in top management positions often have conflicting interpretations concerning the authoritative qualities that align with the intrinsic and external relations of an organization. Although, researchers may still debate about the extent to which athletic development personality factors are important internal components of an individual. The purpose of this correlational study was to determine if athletic development personality factors correlate with decision making at the executive leadership level. The research questions focused on determining if there was a relationship between athletic development personality factors and decision making. Social exchange theory, social representations theory, and leadership theories comprised the theoretical …

Policy Uncertainty And The Dual Role Of Corporate Political Strategies, Chansog Francis Kim, Incheol Kim, Christos Pantzalis, Jung Chul Park

Finance Faculty Publications

Firms use active political strategies not only to mitigate uncertainty emanating from legislative activity, but also to enhance their growth opportunities. We find that a firm's systematic risk (beta) can be hedged away by employing various political strategies involving the presence of former politicians on corporate boards of directors, contributions to political campaigns, and corporate lobbying activities. The hedging effect is greater when firms operate in more uncertain industries. In addition, active political strategies are associated with greater firm heterogeneity and make real options more value relevant as potential drivers of competitive advantages in uncertain environments.