Finance and Financial Management Commons^™

The Millennial Investor: Mutual Funds Versus Exchange Traded Funds, Terrell Mclendon

Finance Undergraduate Honors Theses

This research paper seeks to understand the Millennial investor. The distinct purpose of this research is to determine if Millennials in the U.S., specifically those ages 25 to 35, prefer investing in exchange traded funds to mutual funds. Additionally, this research seeks to discern if these Millennials prefer investing online to working with a personal financial advisor. Secondary research was utilized extensively to compile a review of existing literature on the topics of the Millennial generation, mutual funds, exchange traded funds, personal financial brokers, and online investing sites. Primary research was completed through a questionnaire survey to gather new data …

The Relation Between University Endowment Fund Size And University Reputational Rankings, Jason Wolbrom

Financial Analyst

Universities compete with each other to admit the best students and achieve the highest quality ranking. Students use reputational ranking to determine which institution they want to attend. Universities use student tuition plus alumni donations to establish an investable endowment fund. In this paper, multiple analyses are run to investigate the relation between reputational rankings and endowment funds between 2006 and 2014. The main and surprising finding of the paper is that the expectation of a strong positive link between the two rankings is not borne out by the data. One additional interesting finding is that the lower a university’s …

Private Equity Investment In High Growth Companies: Selection & Performance, Andrew Mcalpine

Financial Analyst

Over the years, private equity buyout funds (PEs) have become increasingly interested in investing in high growth entrepreneurial firms, which has traditionally been an investment territory of venture capital funds (VCs). There is a dearth of study on how PEs invest and perform in the so-called “growth equity” space. The purpose of this research paper is to fill this void in the extant literature by comparing the characteristics of investments by PEs to those by VCs in entrepreneurial companies between January 1990 and December 2014. My research finds that both investment round size and company valuation are larger when PEs …

Effect Of Automated Advising Platforms On The Financial Advising Market, Benjamin Faubion

Accounting Undergraduate Honors Theses

This thesis outlines the cost to investor differences between a traditional financial advisor and the growing group of highly competitive automated Robo-Advisors.

Do Investors Value The Required Stress Tests Of Financial Holding Companies?, Brendan A. Colligan

Finance Undergraduate Honors Theses

This paper explores the value of disclosing stress test results to investors and market participants within the US financial system. Recently the Federal Reserve (“Fed”) expanded its required internal stress testing program, often referred to as the Dodd-Frank Act Stress Test (“DFAST”), to include bank holding companies (“BHCs”) with more than $10 billion in total assets. These BHCs were required to publicly disclose their results for the first time in June of 2015. Large BHCs are subject to another level of stress testing implemented by the Comprehensive Capital Analysis Review (“CCAR”). Large BHCs are defined as having more than $50 …

Financial Performance In Upstream, Downstream, And Integrated Oil Companies In Response To Oil Price Volatility, Jonathan P. Garcia

Finance Undergraduate Honors Theses

This paper investigates the relation between crude oil price volatility and stock returns among oil companies using a three-part methodology, by using the West Texas Intermediate (WTI) as oil price benchmark. I asses the various indicators that set signals for oil price volatility and the interpretation of each (PMI, S&P500, DJIA, and World Crude Oil Output). This research also focuses on the relation between different types of companies in the oil industry (integrated, upstream, and downstream) and how each type of company will be assessed in a particular way to predict abnormal returns, based on market data and statistical analyses …

Correlation Between Shareholder Concentration And Firm Performance With Regard To Midcap Companies, Wynn Lemmons

Finance Undergraduate Honors Theses

The research herein explores the correlation between performance and shareholder concentration. This paper compares the performance of a group of companies with a single shareholder stake of over 10% from the universe of the S&P 400 Midcap Index to the performance of the index itself over a period of eight years (January 1, 2009 to January 1, 2016). When run as a simulated portfolio, the group selected generated a slight amount of positive alpha, but the results were ultimately statistically insignificant.

Profit Shifting And Manipulation, Byron Dela Rosa

Renée Crown University Honors Thesis Projects - All

As of late, many U.S. firms have made their way overseas in ways many feel are unethical. U.S. multinationals have taken note of the unimaginable domestic corporate income tax rate the United States has set for these U.S. corporations. Similar to an individual paycheck you may receive, you must pay a portion to the U.S. government in taxes. And even more similarly, you wish that you did not have to pay it either. U.S. multinationals have the same mindset, as they have found ways to avoid the corporate income tax through foreign activity strategies. Using scholarly research papers and well-renown …

Financial Literacy In High School Education, Chelsea N. Simmons

Honors Theses

Personal finance has become increasingly complicated in the past thirty years due to globalization and financial engineering. Americans are faced with new financial products and decisions, and many do not have the knowledge or expertise to successfully manage their finances. Financial literacy is especially low among young adults. Individual states have responded by introducing a personal finance course into the high school curriculum. This course may be an elective or a requirement for graduation. This study begins to examine personal finance curriculum in high schools and the effect such coursework has on overall financial literacy when students reach college.

The Question Of Financial Career Paths: Which Graduate Program And/Or Professional Certification Leads To The Greatest Income And Level Of Satisfaction Based On A Survey Of Professionals Working Within The Accounting/Finance Fields?, Tanner M. Shaw

Honors Theses

Thousands of men and women across the United States graduate from accounting and finance undergraduate programs and find themselves uncertain about what the future holds and what steps should be taken in order to maximize their odds of meeting their personal goals related to job satisfaction and level of income. This study aims to evaluate graduate degree and non-graduate-degree alternatives, as well as the CPA and CFA professional designations in terms of the likelihood of each route leading to high job satisfaction and a high level of income. To that end, a survey of successful accounting and finance professionals was …

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 …

Portfolio Manager Compensation And Mutual Fund Performance, Linlin Ma, Yuehua Tang, Juan-Pedro Gomez

Research Collection Lee Kong Chian School Of Business

We use a novel dataset to study the relation between individual portfolio manager compensation and mutual fund performance. Managers with explicit performance-based pay exhibit superior subsequent fund performance, especially when investment advisors link pay to performance over a longer time period. In contrast, alternative compensation arrangements, such as fixed salary, assets-based pay, or advisor-profits-based pay are not associated with superior performance. Our tests further show that the positive relation between performance-based contracts and fund performance is not driven by the selection of talented managers proxied by education background. Lastly, managers with performance-based pay engage less in risk-shifting activities.

What Citizens Want To Know About Their Government’S Finances: Closing The Information Gap, Meagan Jordan, Juita-Elena (Wie) Yusuf, Martin Mayer, Kaitrin Mahar

School of Public Service Faculty Publications

There is an information gap between citizens and their governments when it comes to government finances. The inherent complexity of fiscal policy makes it exceedingly difficult for effective public participation. Effective public participation in fiscal decision making must address informing or educating the citizenry with accurate and meaningful government financial data. Better understanding citizen wants and perceptions is critical to closing the information gap between users and providers of financial information. This study uses information gathered from focus groups with residents of Norfolk, Virginia that asks what government financial information they want and how to make that information useful. Results …

Spillover Effects In Mutual Fund Companies, Clemens Sialm, T. Mandy Tham

Research Collection Lee Kong Chian School Of Business

Our paper investigates spillover effects across different business segments of publicly traded financial conglomerates. We find that the investment decisions of mutual fund shareholders do not depend only on the prior performance of the mutual funds; they also depend on the prior performance of the funds’ management companies. Flows into equity and bond mutual funds increase with the prior stock price performance of the funds’ management companies after controlling for fund performance and other fund characteristics. The sensitivity of flows to the management company’s performance is not justified by the subsequent performance of the affiliated funds. The results indicate that …

Essays On The Role Of Institutional Ownership In Bank Governance, Mohammad Jafarinejad

Theses and Dissertations

This dissertation consists of three chapters, focusing on U.S. bank holding companies from 2007 to 2013 to explore the role of institutional ownership in bank governance. In addition to the impact of ownership proportion, I explore the impact of ownership dispersion among institutional investors on bank safety, profitability and performance.

In Chapter I, I show that the proportion of institutional ownership in banks has increased significantly after the recent financial crisis. Moreover, I examine the impact of institutional ownership proportion and dispersion on bank safety using capital ratios (i.e., Tier 1 and Tier 2 capital ratios) and credit risk (i.e. …

Pre-Holiday Anomaly: Examining The Pre-Holiday Effect Around Martin Luther King Jr. Day, Scott E. Jones

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

This paper looks at the 17 years leading up to Martin Luther King Jr. day becoming a non-traded holiday and the 17 years since to see if this exogenous shock to the market resulted in abnormal rates of return on the day before the holiday (known as the pre-holiday effect). I also look to see if evidence of abnormal returns still exists before Christmas and July 4^th during the same time period. I used daily data on the equally-weighted universe of stocks, the value-weighted universe of stocks, and the S&P 500. I find that while there is some evidence …

Object-Oriented Programming: A Method For Pricing Options, Leonard Stewart Higham

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

In the world of finance, it’s becoming necessary to obtain computer programming knowledge and experience, a marketable skill that prepares one conduct quantitative analysis. The objective of this thesis is to utilize concepts in finance and computer science together to form a pricing library for financial derivatives, thus, develop a strong skillset in a specific area of financial computational methods. Through implementation of object-oriented programming and specific design patterns in Python, I develop a pricing engine for many types of options, from plain vanilla to unique and complex options, with the focus on the ability to reuse and extend various …

Price Discovery Of Index Futures Across Markets, Jerry X. Cao, Xiaoming Wang, Nelson Yap, Sili Zhou

Research Collection Lee Kong Chian School Of Business

The trading of foreign index futures by the Singapore Exchange (SGX) offers an ideal opportunity to study price discovery and information of trading across different markets. We examine four popular indices - Nikkei 225 Index, MSCI Taiwan Index, CNX Nifty Index and the FTSE China A50 Index traded in SGX and compare them with their home market trading. In contrary to standard theory and evidence, we show that smaller bid-ask spread, lower minimum lots and cheaper transaction cost do not necessary improve information efficiency. These results may shed some light on the usefulness of the role of an international financial …

The Microstructure Behavior Of Sgx Nikkei 225 Index Futures Resulting From Component Changes Of The Underlying Cash Market Index, Charlie Charoenwong, David K. Ding, Vasan Siraprapasiri

Research Collection Lee Kong Chian School Of Business

We study the effect of changes involving component stocks of the Nikkei 225 stock index on the behavior of the Nikkei 225 index futures. Specifically, we examine the effects of component changes of the Nikkei 225 on the volume, returns, volatility, and bid-ask spreads (BAS) on its corresponding futures contract traded on the Singapore Exchange (SGX). We find that trading volume increases and the bid-ask spread decreases but there is no significant change in the returns of the SGX Nikkei 225 index futures after a component change takes place. This does not support the Price Pressure Hypothesis, which states that …

An Empirical Analysis Of Efficiency And Profitability Ratios In The U.S. Retail Industry, Sergio Ribera Boigues

Morehead State Theses and Dissertations

A Thesis Presented to the Faculty of the College of Business and Technology Morehead State University in Fulfillment of the Requirements for the Course IET 699 - Thesis by Sergio Ribera Boigues on April 28, 2016.

Shareholder Activism And Its Long Term Effects, Louis Beck

Honors Scholar Theses

The purpose of this paper is to provide an overview of the current climate in the activist shareholder space, with a primary focus on activist hedge funds aiming to financially benefit from their endeavors. It begins with a written timeline of the history of activist investing throughout the twentieth century and follows with a transition into the current climate. The current landscape of activist investing is then discussed, which includes both criticisms and compliments. This analysis of the current landscape includes a case study of eight well-known hedge funds, some of which operate as pure activist funds while others contain …

Reducing Customer Waiting Time Of Commercial Banking Industry (A Case Study), Feng Gao

Morehead State Theses and Dissertations

A Thesis Presented to the Faculty of the College of Business and Technology Morehead State University in Partial Fulfillment of the Requirements for the Degree Master of Science by Feng Gao April 26, 2016.

Initial Public Offerings (Ipos), Kevin Keller

Celebrating Scholarship & Creativity Day (2011-2017)

As an investor, the first rule is to never get caught up in your emotions. There are thousands of different (exciting) investment opportunities in today’s world, and some of them tend to be a bit riskier than others. These consist of stocks, bonds, certificates of deposit, mutual funds, exchange-traded funds, and several others. However, where do most of these investment tools originate? In order for a stock to be publicly traded on the stock exchange, it must undergo what it called an initial public offering (which I will refer to as an IPO). Since the primary objective is to raise …

Student Debt: Impact On Student Choices, Kelsey Cavanaugh

Celebrating Scholarship & Creativity Day (2011-2017)

In 2010 student loans became the second largest portion of US debt. Today, the estimated total is 1.4 trillion. Over the last decade the average debt per student has increased 56%, which is double the inflation rate for that period. The graduating class of 2014 left college with an average of about $29,000 of debt. Lastly, the number of federal borrowers today is 7.5 million and growing. This presentation examines how student debt affects students’ spending choices after college and what has changed in these patterns over the last decade.

Bsg: Strategic Decision Making For An Athletics Footwear Company, Mekdi Yilma

Scholarly and Creative Works Conference (2015 - 2021)

No abstract available

Asset Allocation, Risk Tolerance And Shortfall Risk, Steven D. Dolvin

All Chapters

Asset allocation is the biggest driver of portfolio performance, particularly over the long-term. Moreover, it also is reflective of an investor's risk tolerance. The recent financial crisis has negatively impacted investment psychology, particularly among younger investors. As a result, the so-called "Generation-Y" has over half of their assets held in cash -- a "non-earning" asset. While this is safe, there is a risk of loss in value, as cash does not even hold up with inflation. In the long-term, such an allocation means a lower retirement balance--i.e., shortfall risk. Thus, these investors have essentially traded one type of risk for …

Short Interest At High Levels, Steven D. Dolvin

All Chapters

Short interest has been high even though the market has recovered significantly. In fact, in the wake of the recovery, short sellers have increased their positions. If they are correct, we could see a market pullback. Their short positions, however, create a large "sideline" demand, which has actually made market moves more positive in the wake of neutral news (due to short covering). See article here, Yahoo/Bloomberg.

Cost Of Debt And Federal Home Loan Bank Funding At U.S. Bank And Thrift Holding Companies, Scott Deacle, Elyas Elyasiani

Business and Economics Faculty Publications

We investigate the relationship between the cost of debt issued by bank holding companies (BHCs) and thrift holding companies (THCs) and their use of Federal Home Loan Bank (FHLB) advances. Cost of debt is used as a measure of bank riskiness for the first time in a FHLB study. A two-equation model of FHLB advances and cost of debt is estimated. Three main results are obtained. First, greater reliance on advances by BHCs and THCs is associated with lower cost of debt in the pre-crisis period, and more strongly so during the crisis, because granting of advances sends a positive …

Consumer Confidence And The Performance Of The Hospitality Industry In Business Cycles, Shane W. Harjes, Levon Goukasian

Seaver College Research And Scholarly Achievement Symposium

The purpose of this research is to examine if consumer confidence plays a role in explaining the financial performance of firms in the hospitality industry. Previous research has shown that consumer confidence has predictive power in forecasting future changes in household spending, and personal consumption growth in the US. Our findings are derived from regression analysis using the Fama-French Five Factor Model, which captures all variations of expected market returns. In order to adequately capture significant findings, we separated abnormal returns into pre-recessionary, recessionary, and post-recessionary time periods. From these findings, we will be able to determine with some certainty …

Thought Leaders: Faculty Who Shape Business Theory And Practice Through Research

Business Exchange

Profiles of seven DePaul professors and the research they are conducting in areas as diverse as work-life balance and investor behavior: James D. Shilling, Real Estate Studies; R. David McLean, Investment Management; Kelly Richmond Pope, Accountancy; Andrew Gallen, Marketing; Alyssa J. Westring, Management; William Sander, Economics; and Misty Johanson, Hospitality Leadership.