Business Commons^™

Asset Allocation For Retirement: Simple Heuristics And Target-Date Funds, Steven D. Dolvin, William K. Templeton, William Rieber

William K. Templeton

We examine common asset allocation strategies for retirement investing, considering both static and dynamic approaches, as well as those allocation policies used by leading target-date fund providers. We studied the average performance of each strategy over historical rolling periods (that is, bootstrapping), using actual annual returns starting in 1926. Then we applied the simulation method to review potential future results, as well as to provide additional insight into the structure and characteristics of each approach. We find that, over time, certain static approaches are essentially equivalent to dynamic strategies that reduce equity exposure through time. Further, we find that most …

The Effect Of Nonbank Diversification On Bank Holding Company Risk, William K. Templeton, Jacobus T. Severiens

William K. Templeton

Examines the effect of activity diversification on bank holding company (BHC) risk. Historical background of the BHC; Presentation of the research design and test results; Predictions of the modern portfolio theory; Implications of the study regarding the effect of nonbank diversification on BHC risk.

A Simulation Approach To The Choice Between Fixed And Adjustable Rate Mortgages, William K. Templeton, Robert S. Main, J. B. Orris

William K. Templeton

Presents a study which offers simulation approach model by which borrowers may more effectively evaluate fixed rate mortgage (FRM) and adjustable rate mortgage (ARM) choice. Identification of pricing variables as an important determinant of choice; Construction of model parameters comparing present value costs of ARM and FRM; Presentation of simulation outputs.

An Investigation Of Adjustable-Rate Mortgage Pricing Features, William K. Templeton, Robert S. Main, J. B. Orris

William K. Templeton

Investigates costs and risks associated with the choice of terms for adjustable rate mortgages. Impact of mortgage-rate changes on the size of payments for adjustable-rate mortgages; Examination of the choice of length of the fixed period before the occurrence of the first interest rate; Assessment of the choice of annual and lifetime caps for a standard one year adjustable rate mortgages.

Financial Education And Asset Allocation, Steven D. Dolvin, William K. Templeton

William K. Templeton

We conduct a clinical study on a firm that restructures its 401(k) plan and simultaneously offers financial education seminars to its employees. The restructuring requires each employee to restate allocation percentages, thus we are able to analyze the specific benefits of retirement planning seminars on the asset allocation decision. We find that seminar attendance is associated with increased portfolio diversification and improved risk management. When combined with changes in return, the overall result is that seminar attendees create more efficient portfolios, which implies a better understanding of the retirement planning process.

European Banking After The Euro: Progress And Problems, William Templeton, Robert Clark

William K. Templeton

Note: full-text not available due to publisher restrictions. Link takes you to an external site where you can locate the article at your local library.

Discusses the changes in European banking since the introduction of the euro, providing statistics on mergers and acquisitions (mostly domestic) and their effects on assets both inside and outside the eurozone. Considers the factors which make cross-border mergers less attractive, the effect of consolidation on costs, and the impact of the euro on foreign exchange earnings, debt markets and cash management systems. Concludes that although banks are becoming more competitive with each other and with …

Banking On The Euro: Changes And Challenges, William Templeton, Charlotte Bond

William K. Templeton

Note: full-text not available due to publisher restrictions. Link takes you to an external site where you can locate the article at your local library.

Considers the likely effects of EMU and the introduction of the euro on the “fragmented” European banking industry. Recognizes that transition to the euro will be expensive in terms of equipment, training, customer care etc.; and that some new products and services will be demanded (e.g. cross-border cash management systems, euro-denominated bonds etc.) while others will decline (e.g. foreign exchange hedging, commercial loans etc.). Refers to US experience to identify growth opportunities and discusses the …