Retail minority shareholders and corporate reputation as determinant of dividend policy in Australia

This paper investigates the influence of retail minority shareholders in the determination of corporate dividend policies of Australian companies. While retail investors are typically also minority shareholders and therefore perceived in academic literature to have limited influence on corporate dividend decisions, casual empiricism suggests the contrary. We hypothesise that corporate reputation serves as a device aligning managers' incentives with retail minority shareholder interests, and that the propensity to manage for corporate reputation is positively related to the degree of retail shareholder base. We find empirical evidence of managers of Australian companies catering to the retail investors' preference for dividends when setting dividend policy, even when they are minority shareholders, so long as the proportion of these retail shareholders relative to the total shareholder base is high. Our results are robust when controlled for the factors of size, profitability, financial leverage, signalling, agency costs and franking credits.     

Mutual fund herding its impact on stock returns: Evidence from the Taiwan stock market

Using quarterly ownership data which identify identity codes of mutual funds in Taiwan, we investigate mutual fund herding and its impact on stock price. We show that mutual funds tend to follow their own steps in trading rather than follow trades made by other funds. More importantly, evidence of price continuation following mutual fund herd buying suggests that such herding is based on value-relevant information and is consistent with the investigative herding hypothesis. Alternatively, evidence of return reversal following mutual fund herd selling suggests that such herding is non-informational and is consistent with the characteristic herding hypothesis.     

Cross-listing effect on information environment of foreign firms: ADR type and country characteristics

We examine sources of improvement in the information environment of foreign firms that cross-listed in the United States as American Depositary Receipts (ADRs) between 1995 and 2005. We analyze changes in the number and dispersion of analyst recommendations on foreign firms following their cross-listing. We find increases in analyst coverage intensity across all four types of ADR programs, especially among firms that were listed on organized exchanges (the listing effect), and those that adopted capital raising ADR programs (the financing effect). Our results suggest that the listing effect is more persistent than the financing effect. On the other hand, reductions in recommendation dispersion are observed mainly for firms that choose non-capital raising ADRs and those from emerging markets. Overall, improvements in information environment are more profound among foreign firms originating from countries with greater information asymmetry, namely, countries with weaker legal tradition and rule of law, and countries that are less familiar to U.S. investors.     

Corporate strategy financialized: Conjuncture,arbitrage and earnings capacity in the S&P500

The conjuncture that ushered in the era of shareholder value served to embed capital market expectations into corporate governance aligning management and shareholder interests. Market arbitrage focussed on modifying contractual relations with stakeholders to extract a (higher) return on invested capital. In this article we focus on cash earnings on capital employed generated by the S&P 500 survivor group of firms covering the period 1990–2008. We use this financial data to construct three complementary perspectives on corporate financial performance: firm, firm-relative and macro. Within this framework the financial numbers and perspectives are analogous to a ‘hall of mirrors’ where ambiguity and contradiction are in play frustrating straightforward performative narratives that connect purpose with financial transformation an era of shareholder value.     

Hedging variance options on continuous semimartingales

We find robust model-free hedges and price bounds for options on the realized variance of [the returns on] an underlying price process. Assuming only that the underlying process is a positive continuous semimartingale, we superreplicate and subreplicate variance options and forward-starting variance options, by dynamically trading the underlying asset and statically holding European options. We thereby derive upper and lower bounds on values of variance options, in terms of Europeans.     

未来房地产网络营销在线交易模式

当前,我国电子商务技术得到了迅猛发展,房地产网络营销是必然的趋势,部分房企试水房产电商并建立独立的区域性体系,却收效甚微,弊端与瓶颈凸显。通过对我国房地产网络营销宏观和微观上现存问题的分析,提出未来房产的“整体－区域”在线交易模式的要点以及构建。首先,在政府引导下,房地产企业和第三方机构以购房者为中心,构建出四位一体的全国整体性营销信息平台体系;其次,在此基础上建立由企业、购房者、第三方机构组成的区域性在线交易三角关系;最后,诱导更多的企业进入,进而构建出有效的房产在线交易模式。     

Modeling an HR shared services center: Experience of an MNC in the United Kingdom

An increasing number of large and multinational organizations are moving to shared services models in delivering the human resource function. It is commonly believed that the adoption of an HR shared services model can transform the role of HR by enabling the HR function to be more strategic at the corporate level and more cost‐effective at the operational level. However, few academic studies have been carried out to investigate challenges to implementing an HR services center successfully and the impact of adopting an HR shared services model on different groups of employees. Through a case study of a multinational corporation, this article reveals that there remains a significant gap between literature espousing the efficacy and utility of HR shared services and the extent to which the adoption of such a model is successful. The financial and emotional cost of moving to a shared services model can outweigh the tangible cost savings predicted by firms. The idea of separating the HR function into strategic, operational, and administrative components may prove to be too simplistic, although it underpins the initiative of HR shared services. © 2006 Wiley Periodicals, Inc.     

Noise Trading and the Management of Operational Risk; Firms,Traders and Irrationality in Financial Markets*

abstract Efficient market models cannot explain the high level of trading in financial markets in terms of asset portfolio adjustment. It is presumed that much of this excessive trading is irrational ‘noise’ trading. A corollary is that there must either be irrational traders in the market or rational traders with irrational aberrations. The paper reviews the various attempts to explain noise trading in the finance literature, concluding that the persistence of irrationality is not well explained. Data from a study of 118 traders in four large investment banks are presented to advance reasons why traders might seek to trade more frequently than financial models predict. The argument is advanced that trades do not simply occur in order to generate profit, but it does not follow that such trading is irrational. Trading may generate information, accelerate learning, create commitments and enhance social capital, all of which sustain traders' long term survival in the market. The paper treats noise trading as a form of operational risk facing firms operating in financial markets and discusses approaches to the management of such risk.     

Vacaciones y licencias en países desarrollados: los Estados Unidos a la zaga en cuanto a equilibrio entre vida profesional y vida familiar

Los autores comparan las normativas sobre vacaciones y licencias susceptibles de facilitar el equilibrio entre vida profesional y familiar de Australia, Canadá, República de Corea, Estados Unidos, Europa occidental y Japón utilizando un índice compuesto para clasificarlas. Los Estados Unidos figuran en último lugar: la concesión de vacaciones anuales al trabajador no es obligatoria y las licencias por motivos familiares se limitan a 12 semanas al año. Este bajo nivel de reglamentación podría deberse, según los autores, a una concepción mercantilista del empleo sumada a la creencia de que empleador y trabajadores tienen idéntica capacidad de negociación, visión no compartida por las demás democracias industrializadas.     

Real Asset Valuation under Imperfect Competition: Can We Forget About Market Fundamentals?

Real assets are usually valued by computing the stream of profits they can bring to a price‐taking firm in a liquid market. This method ignores market fundamentals by assuming that all the relevant information is included in the spot price. Our article analyses the bias resulting from such an approach when the market is imperfectly competitive. We propose a stylised two‐period model of the natural gas market with no uncertainty, focusing on strategic interactions between two types of oligopolistic players—pure traders and suppliers with downstream customers—who have access to storage. We show that the true value of storage capacity is not the same for traders and for suppliers. Comparing the latter value with the traditional price‐taking valuation reveals a systematic bias that tends to induce underinvestment.