Finance and Financial Management Commons^™

Analysis Of Hong Kong To Be An Offshore Financial Center Of Rmb, Qichao Song

Lingnan Journal of Banking, Finance and Economics

In this article we aim to discuss the possibility and feasibility as well as the disadvantages and barriers for Hong Kong to be an offshore financial center of RMB. As the most biggest financial center in China, Hong Kong need to develop the RMB business for strengthening its position in the international competition. And we think that to become an RMB offshore financial center is not only an opportunity but also a responsibility for Hong Kong. We also give some suggestions on this issue.

Citizens’ Satisfaction With The Sar Government's Overall Performance In Post-Colonial Hong Kong : Result Of Ols Analysis, Luo Yang

Lingnan Journal of Banking, Finance and Economics

Through studying of the impact of the Hong Kong Special Administration Region government’s performance in various policy areas upon the level of citizen’s satisfaction with the government’s overall performance, this paper confirms the general wisdom that economic development is an important source of citizens’ satisfaction with the government’s performance. It further proves that, government’s performance on democratic development and freedom of speech and assembly are also very powerful variables in the model and its partial coefficients are impressive.

An Experimental Study About Effective Factors Of First-Day Offer Pricing : Taking Stock Markets As An Example, Yi Liu

Lingnan Journal of Banking, Finance and Economics

The author examines the literature with respect to the pricing of initial public offerings and focus upon the effective factors of pricing. Using a data base of all share offerings undertaken in Hong Kong over a one year period (in 2007), the author finds that there is considerable evidence for the proposition that large and well-capitalized companies tend to price their share offerings at a higher absolute level in order to get a higher level of first-day closing price. Using classical statistical methods, the author finds that the pricing strategy of offering companies is connected to shareholders’ desire of the …

The Fall Of Long-Term Capital Management, Xiaowei Guo

Lingnan Journal of Banking, Finance and Economics

The author examines the literature with respect to the pricing of initial public offerings and focus upon the effective factors of pricing. Using a data base of all share offerings undertaken in Hong Kong over a one year period (in 2007), the author finds that there is considerable evidence for the proposition that large and well-capitalized companies tend to price their share offerings at a higher absolute level in order to get a higher level of first-day closing price. Using classical statistical methods, the author finds that the pricing strategy of offering companies is connected to shareholders’ desire of the …

What Determines Public Pension Investment Risk-Taking Policy, Nancy Mohan, Ting Zhang

Economics and Finance Faculty Publications

State public pension plans, mostly defined benefit plans, cover pension benefits for 12.8 million active public employees and 5.9 million retirees and other annuitants. However, by the end of 2009, public pension plans had accumulated a total funding deficit of $697 billion (measured by the difference between actuarial pension assets and liabilities). On average, public pension funds cover 75 percent of their liabilities, but individual state results vary greatly.

The 2008 stock market crash strongly affected pension asset value in that equity allocation on average accounted for 56 percent of invested assets. The average 2009 pension asset beta of 0.63 …

How One Trade Could Change The World: High Frequency Trading And The Flash Crash Of 2010, Sarah Perlman

Honors Projects in Finance

Financial markets are controlled directly by a small population of people, but have direct effects on almost every aspect of the global community. Financial markets are now flooded with computerized algorithms that have drastically changed the face of trading. As with any advances in technology, there are always unforeseen events that create new challenges, and adjustments that need to be made. In our increasingly global and technological world, one wrong click of the mouse in New York could affect the stock markets in London, Tokyo, and Brazil. On May 6th, 2010, such a situation occurred and caused the Dow Jones …

Upjohn Institute Policy Paper: Public Pension Crisis And Investment Risk Taking: Underfunding, Fiscal Constraints, Public Accounting, And Policy Implications, Nancy Mohan, Ting Zhang

Economics and Finance Faculty Publications

Public pension funds that cover retirement benefits for almost 20 million active or retired employees have been significantly underfunded. An important, though largely overlooked, issue related to pension underfunding is the excessive investment risk levels assumed by public plans. Our analysis suggests government accounting standards strongly affect public fund investment risk, as higher return assumptions (used to discount pension liabilities) are associated with higher investment risk.

Public funds undertake more risk if they are underfunded and have lower investment returns in previous years, consistent with the risk transfer hypothesis. Furthermore, pension funds in states facing fiscal constraints allocate more assets …

Indiana State University Financial Report 2012, Indiana State University

Financial Reports

No abstract provided.

The Impact Of Institutional Arrangements On Educational Efficiency, Trevor Collier

Economics and Finance Faculty Publications

Per-pupil expenditures on education in the United States have grown immensely in recent decades, yet student achievement has been stagnant. An abundance of research has sought to solve this enigma, much of it centered on the incentive structure facing administrators. Some recent papers use TIMSS data to analyze the relationship between institutional arrangements—that typically do not vary within a single country—and student achievement. Similarly, we utilize TIMSS 1999 to determine if there is an indirect relationship between institutional arrangements and student achievement, via a relationship with school efficiency. Our results show that the specified link between institutional arrangements and student …

The Potential Application Of Weather Derivatives To Hedge Harvest Value Risk In The Champagne Region Of France, Andrew W. Yandell

CMC Senior Theses

In Champagne, France grape growers and and winemakers work together to make the world's most iconic sparkling wine. Part of what makes Champagne so celebrated is its reputation for constant quality: only the best grapes are used to make wine. In poor vintage years, grape growers sell less grapes to winemakers; poor vintages are the result of bad weather. This presents the opportunity for grape growers to hedge the risk of poor weather and resulting lower harvest values with weather derivatives. This study explores the potential for grape growers to trade them to effectively hedge against low harvest values by …

Finding Profitability Of Technical Trading Rules In Emerging Market Exchange Traded Funds, Austin P. Hallett

CMC Senior Theses

This thesis further investigates the effectiveness of 15 variable moving average strategies that mimic the trading rules used in the study by Brock, Lakonishok, and LeBaron (1992). Instead of applying these strategies to developed markets, unique characteristics of emerging markets offer opportunity to investors that warrant further research. Before transaction costs, all 15 variable moving average strategies outperform the naïve benchmark strategy of buying and holding different emerging market ETF's over the volatile period of 858 trading days. However, the variable moving averages perform poorly in the "bubble" market cycle. In fact, sell signals become more unprofitable than buy signals …

An Institutional Perspective And The Role Of The State For Chinese Ofdi, Bing Ren, Hao Liang, Ying Zheng

Research Collection Lee Kong Chian School Of Business

Napoleon called China a ‘sleeping dragon’, but recent economic developments as China enters the twenty-first century show that the dragon is awakening. China has maintained strong economic growth since 1979 and sustained a GDP increase of more than 9 percent over the years. The total volume of economic output increased from 2.8 percent in 1970 to 7.23 percent in 2008, ranking China as the third largest economy in the world (United Nation Statistics Division Statistical Databases). China launched its ‘Go Global’ policy in 1999 to encourage highperforming Chinese firms to invest abroad and upgrade their global competence. Since then, outward …

What Are Analysts Really Good At?, Ohad Kadan, Leonardo Madureira, Rong Wang, Tzachi. Zach

Research Collection Lee Kong Chian School Of Business

Sell-side analysts employ different benchmarks when defining their stock recommendations. Forexample, a ‘buy’ for some brokers means the stock is expected to outperform its peers in the same sector(“industry benchmarkers”), while for other brokers it means the stock is expected to outperform themarket (“market benchmarkers”), or just some absolute return (“total benchmarkers”). We use thesebenchmarks to analyze the role of stock picking, industry picking and market timing in contributing to theperformance of stock recommendations. We are able to do so given that different benchmarks suggest theuse of different sets of abilities. Analysis of the relation between analysts’ recommendations and theirlong-term …

Rationale For Financial System Regulation And Supervision: A Global Perspective, Victor Ekpu

Bullion

The paper examines the enormous role of financial institutions, especially banks to the efficient functioning of the economy. The shortcomings of regulation and supervision, notwithstanding, one can argue that because of the special role that financial institutions play in the economy and the economic and social costs to society of their eventual failure, it is obvious that leaving the forces of demand and supply to bear will have adverse implications on the economy and the living standards of the nation's citizens. lt is on this note that i expound on the various reasons for financial system regulation in section 2. …

Dating The Timeline Of Financial Bubbles During The Subprime Crisis, Peter C. B. Phillips, Jun Yu

Research Collection School Of Economics

A new recursive regression methodology is introduced to analyze the bubble characteristics of various financial time series during the subprime crisis. The methods modify a technique proposed in Phillips, Wu, and Yu (2011) and provide a technology for identifying bubble behavior with consistent dating of their origination and collapse. The tests serve as an early warning diagnostic of bubble activity and a new procedure is introduced for testing bubble migration across markets. Three relevant financial series are investigated, including a financial asset price (a house price index), a commodity price (the crude oil price), and one bond price (the spread …

The Role Of Non-Interest Banking In National Economic Development, Hakeem Ishola Mobolaji

Bullion

The paper examines non-interest Banking model that operates devoid of interest in lending, financing, deposit-taking and all forms of financial intermediation. Hence, the bank becomes an important financial institution for enhancing growth and development in an economy. The article is divided into five section, the first being the introduction, section two contains the conceptual framework, three highlights non-interest banking in Nigeria and four concludes the paper.

Study On Ship Investment Risk : Uo Company As An Example, Yichen Chen

World Maritime University Dissertations

No abstract provided.

Research On The Impact Of Container Freight Derivatives On Shipping, Zhenle Shen

World Maritime University Dissertations

No abstract provided.

Process Optimization In Freight Forwarding Industry, Xiaohua Shi

World Maritime University Dissertations

No abstract provided.

An Investigation Of Shipping Derivatives Based On Risk Evaluation, Sheng Yang

World Maritime University Dissertations

No abstract provided.

Liner Shipping Lane Planning From Shanghai Port To Guangzhou Port Of Shanghai Baoyin Shipping Co., Ltd, Zhujun Zhou

World Maritime University Dissertations

No abstract provided.

Research On Capacity Development Plan Of Wenzhou Shipping Company, Xinlei Chen

World Maritime University Dissertations

No abstract provided.

The Application Of Portfolio Theory In Shipping Assets And Business For Shipping Company, Ying Zheng

World Maritime University Dissertations

No abstract provided.

Three Essays On Opacity, Corporate Governance, And Credit Ratings, Yiwen Gu

Graduate Theses and Dissertations

In the first essay, utilizing a more recent and expanded 20-year sample 1991-2010 of dual-rated bonds issued, I confirm Morgan's (2002) finding that banks are relatively more opaque than nonbanks. The likelihood of a rating split is higher, and the magnitude of the rating gap is larger, for banks than nonnbanks. Moreover, rating agency disagreements are more significant for banks with relatively higher loan and trading securities holdings and maintain lower capital, and for banks engaged in mortgage securitization. Importantly, I find that rating agency disagreements reflect market proxies of information uncertainty. Further, opacity makes external financing more costly. Equity …

The Implications Of Sovereign Wealth Fund Investment On Capital Markets: A Bottom-Up View, David Fernandez

Research Collection Lee Kong Chian School Of Business

The buzz around sovereign wealth funds has been turned down a notch, but they remain a hot topic. The accusations of sovereign wealth funds having hidden agendas remain, but with the very public losses suffered by some during the recent financial turmoil, such talk has even less credibility. And given that most of those losses were from investments in US, UK, and European financial institutions, hope that sovereign wealth funds would be the saviors of Wall Street has also faded. At its base, four trends continue to keep sovereign wealth funds in focus. First, there is the phenomenal rise of …

A Martingale Approach For Testing Diffusion Models Based On Infinitesimal Operator, Zhaogang Song

Research Collection Lee Kong Chian School Of Business

I develop an omnibus specification test for diffusion models based on the infinitesimal operator. The infinitesimal operator based identification of the diffusion process is equivalent to a “martingale hypothesis” for the processes obtained by a transformation of the original diffusion model. My test procedure is then constructed by checking the “martingale hypothesis” via a multivariate generalized spectral derivative based approach that delivers a  asymptotical null distribution for the test statistic. The infinitesimal operator of the diffusion process is a closed-form function of drift and diffusion terms. Consequently, my test procedure covers both univariate and multivariate diffusion models in a unified …

Investment Styles, Fees, & Returns Among Individually Managed & Team Managed Mutual Funds, Kendal Cehanowicz

Honors Projects in Finance

Identifying a successful mutual fund investment involves a crucial analysis of alternatives, all of which influence the true benefit of the investment. Major considerations must include performance, management and fees; which ultimately determine investment returns. Studies have shown that team managed mutual funds exhibit similar risk adjusted performance to individually managed mutual funds, however studies lack this comparison of performance based on fund fees and investment objective. This gap in research implies that there is an opportunity to examine how fund management, investment objective, and fund fees affect overall returns to the investor. Using the 2010 Center for Research in …

Impact Of The Economic Downturn On Local Governments In South Carolina, William Tomes

Georgia Journal of Public Policy

Across the country local government revenues have decreased while operating costs such as fuel, materials, equipment, and health insurance costs have significantly increased. In addition to reduced revenues, interest earnings for city and county government investments are low. These factors combined have created a difficult financial arena in which local governments must operate. While economists are reporting signs of economic recovery, many city and county budgets are just now feeling the full brunt of the economic downturn that began in 2008. On a daily basis, news media nationwide report local governments addressing budget deficits by cutting services, eliminating positions, or …

The Unintended Effects Of The Sarbanes-Oxley Act, Vidhi Chhaochharia, Clemens A. Otto, Vikrant Vig

Research Collection Lee Kong Chian School Of Business

The Sarbanes-Oxley Act (SOX) was passed in the wake of several scandals that rocked corporate America in 2001 and 2002. The objective behind SOX was to improve corporate governance by improving accounting disclosures. Compliance with Section 404 is considered by many to be the most costly requirement of SOX and has been argued to be a disproportionate burden for small firms. Consequently, firms with a public float below $75 million were granted several exemptions from compliance. We document an unintended effect of these exemptions: a weakening of corporate governance through a weakening of the market for corporate control.

Explosive Behavior In The 1990s Nasdaq: When Did Exuberance Escalate Asset Values?, Peter C. B. Phillips, Yangru Wu, Jun Yu

Research Collection School Of Economics

A recursive test procedure is suggested that provides a mechanism for testing explosive behavior, date stamping the origination and collapse of economic exuberance, and providing valid confidence intervals for explosive growth rates. The method involves the recursive implementation of a right-side unit root test and a sup test, both of which are easy to use in practical applications, and some new limit theory for mildly explosive processes. The test procedure is shown to have discriminatory power in detecting periodically collapsing bubbles, thereby overcoming a weakness in earlier applications of unit root tests for economic bubbles. An empirical application to the …