Business Commons^™

Do Industries' Political Profiles Affect Their Portfolio Return Performance?, Shaddy S. Douidar

USF Tampa Graduate Theses and Dissertations

The political profiles of an industry influence its performance due to its impact on industry-level investor sentiment and idiosyncratic risk. I form eight comprehensive political profile portfolios after double sorting on industry-level: (1) political geography proxied by political alignment, (2) corporate political strategies (CPS), proxied by donations to political action committees & lobbying expenditures, (3) and government interference, proxied by dependence on procurement contracts & federal regulations, and exhibit that an industries’ political profiles impact its returns. Industries with high political alignment, concentrated corporate political strategies, and low government interference, deemed the high-performance portfolio, earn an annualized alpha of 10.3428%, …

Lehman Brothers Bankruptcy: Reasons, Effects, And Outcome, Christian J. Reller

Finance Undergraduate Honors Theses

Lehman Brothers’ bankruptcy was a major turning point during the 2008 Financial Crisis, and Lehman Brothers itself has become a prime example of regulatory failure since its closing. The demise of Lehman stemmed from the repeal of the Glass-Steagall Act of 1933. The deregulation of investment banking in the 1990s forged the way for new investment practices on Wall Street. The relaxation of rules allowed investment banks to be heavily invested in volatile assets. Lehman’s issues were an extremely high leverage ratio, illiquid assets, and poor corporate governance. An extremely high leverage ratio left Lehman susceptible to large movements in …

The Effects Of Bank Lobbying And Elections Surprises, Gregory Logan Tarbet

All Graduate Plan B and other Reports, Spring 1920 to Spring 2023

This paper examines the stock market reaction to banks that lobby relative to banks that did not lobby in the period around the November 9, 2016, U.S. presidential election. Using three different methods of event studies to calculate the cumulative average return, we find that lobbying in banks has a meaningful relationship to an abnormal increase in those firm’s stock prices. Then we attempt to control for both the systemic importance and size of these institutions by performing cross-sectional regressions that include matched size, and the systemic nature of the banks. The results suggest that a heavily regulated industry such …

Insider Trading Enforcement And The Private Information Environment: Evidence From The Newman Ruling, Andrew T. Pierce

Graduate Theses and Dissertations

I exploit a shock to U.S. insider trading law to investigate whether a reduction in the enforceability of tipper-tippee insider trading restrictions leads to changes in information parity among investors and the efficiency of price discovery. The December 2014 Federal Second Circuit Court of Appeals ruling in US v. Newman constrained enforcement by restricting the types of exchanges between managers and investors that trigger tipper-tippee insider trading liability. Following Newman, I find that Second Circuit hedge funds experienced a significant increase in their stock picking ability of Second Circuit stocks in terms of preempting future earnings announcement returns and future …

Cryptocurrencies: An Overview, Investment Investigation, Comparative Analysis, And Regulatory Proposals, Jacob Franzen

Theses/Capstones/Creative Projects

With cryptocurrencies moving out of obscurity and into the public eye, the initial purpose of this research paper is to provide the history of cryptocurrencies, to explain the complex workings in and around cryptocurrencies, investigate their investment potential, and to draw attention to their potential for misuse. To follow, the primary purpose is to create a platform on which to compare cryptocurrencies with more common mediums of exchange, analyze their current international regulatory climate, highlight their trends within influential nations, discuss their pending and future regulation, and provide personal proposals for additional regulation. Due to the complex nature of the …

How Access To Finances Affects Gender Inequality Across Cultures, Allison Muntin

Williams Honors College, Honors Research Projects

While many studies of financial inclusion have been undertaken, very few discuss the inclusion of women. Financial inclusion plays a large role in unlocking resources for the disadvantaged, resulting in higher economic growth and development. The economic opportunity allows individuals and businesses to have a greater contribution to society as a whole, enhancing all aspects of the economy. This paper furthers the conversation of women’s access to financial institution accounts across cultures and what underlying factors play a key role. The results indicate that the female demographic has fewer financial institution accounts in comparison to men when: (i) a country’s …

Essays On Bank Deposit Flows And Deposit Rates As A Market Disciplining Mechanism, Prateek Sharma

LSU Doctoral Dissertations

Deposits are the single largest source of funding for banks and are thus key to the stability of the banking system. Deposit flows and deposit rates are two mechanisms through which depositors discipline banks from excessive risk taking thus keeping the banking system stable.

In Chapter 1, I examine aggregate deposit inflows, outflows, and the reallocation of deposits in the banking system to further our understanding of banking stability. I find that on average deposit inflows are nearly three times larger and twice more volatile than outflows. Deposit flows vary with business cycles and market conditions, across deposit types, and …

The Consequences Of Disclosure Regulation: Evidence From Dodd Frank 1502b, Charles Whitley Emerson

Chancellor’s Honors Program Projects

No abstract provided.

Indian Microfinance Sector: A Case Study, Sean P. Gillon

Honors Theses and Capstones

In developing areas of the world with very little economic structure, many activities are not monetized. In other words, money is not used to carry out these tasks because the people in these areas do not have the expendable funds required. In order to combat this problem, micro financing has become increasingly more apparent in these areas of distress. Microfinance is an economic development strategy that allows for those in need to borrow actual money in order to start a business, go to school, or even gain access to everyday living requirements. Microfinance has made tremendous strides over the years, …

High Frequency Trading: Perceptions Regarding Volatility And Regulation, Daniel A. Beck

Honors Theses

Although high frequency trading (HFT) makes up a large portion of day to day trading activity in US and global markets, Khashanah and colleagues (2014) found that nearly half of academic and business industry professionals feel that HFT provides an unfair advantage relative to other market participants, and that a majority of industry professionals share concerns that HFT increases volatility in markets. This creates an environment wherein there are increasing calls by various groups for increased regulation of HFT, and the same study by Khashanah et al (2014) finds that 59% of academics and 46% of industry professionals are of …

Impact Of Regulatory Burden On Small Community Banks In Pennsylvania, Teresa L. Gregory

Walden Dissertations and Doctoral Studies

Community bank managers are struggling with the implementation of the many new regulations promulgated over the past several years. The purpose of this qualitative multiple case study was to explore strategies community bank managers in Pennsylvania use to implement new financial regulations. The population of interest included all community banks in Pennsylvania. For purposes of this study, a community bank was defined in terms of an asset size less than $500 million. Two community banks in Pennsylvania were selected, and 3 participants at each bank were interviewed. The participants included the chief executive officer, the compliance manager, and a mortgage …

The Effect Of Regulations On The Bottom-Line Of Traditional And Shadow Banks, Tsatsu Emmanuel Nyamadi

Walden Dissertations and Doctoral Studies

Return on equity is often associated with prudent risk-taking and the attraction of new clients in advanced economies like the United States, where shadow banks are not regulated. Researchers have contended that freedom from regulation encourages risk-taking and earning of higher profits, but there is a lack of empirical evidence addressing this relationship. The purpose of this quantitative study was to investigate whether lack of regulations result in increased return on equity. The theoretical framework was regulatory arbitrage by Ricks M, Gennaioli N, Shleifer A, and Vishny R. The research question addressed the relationship between regulation, profit margin, leverage, asset …

The Effect Of The Dodd-Frank Act On Risk In The Financial Sector, Beatrix S. Haddon

Senior Honors Projects, 2010-2019

The Dodd-Frank Wall Street Reform and Consumer Protection Act, commonly known as the Dodd-Frank Act, was passed in 2010 in an attempt to increase transparency and accountability in the financial system. The purpose of this thesis is to discover what effect, if any, the Dodd-Frank Act had on both systematic risk and total volatility in the financial sector. My study shows that while the legislation significantly reduced systematic risk in only one out of the seven industries within the financial sector in the time period I analyzed, it successfully reduced total volatility in all seven industries.

Financial Crises And Government Regulation, Yusef Trad

Honors Thesis

In the midst of turmoil, regulation is “a rule or directive made and maintained by an authority” to maintain order. More often than not, the authoritative figure that imposes and upholds regulatory standards, following its introduction to the specific industry or firm, is the government of the respective country or region. However, politicians, like the rest of us, are unable to predict when a crisis will occur and what appropriate regulation should be imposed to prevent that crisis. Thus, an inevitable concern with regulation is the fact that it is unable to thwart an unforeseeable future crisis but is instead …

Are Un-Registered Hedge Funds More Likely To Misreport Returns?, Jorge Perez

Financial Analyst

This paper seeks to introduce an empirical finance analysis of the relationship between misreporting behavior in hedge funds at the return level and registration as an investment adviser with the SEC, a law that has been enacted, overturned and re-enacted in the last decade. We hypothesize that hedge funds that are not registered with the SEC will be more likely to misreport returns so that a fund will seem as if it is generating positive returns more often than not. We test our hypothesis on the return level by conducting several statistical tests and regression models on hedge fund monthly …

Three Essays On Hedge Fund Flows, Regulation, And Economic Geography, Weifang Yang

Theses and Dissertations - UTB/UTPA

Chapter I studies the effect of tax policies (Tax Information Exchange Agreements (TIEAS)) on hedge fund flows and indirectly on hedge fund manager and investor behavior in six tax haven countries. I find that structural changes in both hedge fund dollar flows and net flows occurred in the tax haven countries as a result of TIEAS. I also find that both hedge fund dollar flows and net flows of the countries that signed TIEAS and the countries that did not sign TIEAS increased after their structural break points. Chapter II investigates whether a causal relationship exists between hedge fund flows …

Do U.S. Firms Fly Higher When Bypassing The U.S. Capital Markets? An Investigation Of The Short- And Long-Run Performance Of Foreign Ipos?, Robert N. Killins

Theses and Dissertations - UTB/UTPA

This dissertation studies the performance of U.S. firms that partake in a foreign IPO – bypassing their domestic exchanges and raising their equity in a foreign market. Chapter one provides an introduction and brief review of the main research questions and results. Chapter 2 provides a detailed literature review on initial public offerings-IPOs. This includes relevant studies on the long- and short-run performance of IPOs, theories for IPO underpricing and an international component of the IPO literature. Additional cross-listing literature is also reviewed to provide a more complete and balanced understanding of the international market for equity. Chapter 3 develops …