Tail dependence between gold and sectorial stocks in China: perspectives for portfolio diversification

This article analyzes the relationship between gold quoted on the Shanghai Gold Exchange and Chinese sectorial stocks from 2009 to 2015. Using different copulas, our results show that there is weak but significant tail dependence between gold and Chinese sectorial stock returns. This means that the dependence between extreme movements of the two assets is not pronounced and confirms the role of gold as a safe haven asset. Based on analyzing the efficient frontier, CCC-GARCH optimal weights, hedge ratios and hedging effectiveness, we further show that adding gold into Chinese stock portfolios can help to reduce their risk. Gold appears to be the most efficient diversifier for stocks of the materials sector and the less efficient for the utilities sector. As a robustness check, we also compare gold to oil and indicate that gold is more efficient than oil in the diversification of Chinese stock portfolios.

     

Future scenarios for the charity sector in 2045

Rapid change is affecting the demography, technology and availability of resources (both financial and volunteer) on which charities draw. This paper presents four different scenarios that could describe the charity sector one generation from now as it responds to a different world. We highlight the dangers if any one scenario becomes dominant. While it is inevitable that change will occur, these drawbacks should be minimized and it is important that public funders and policy makers steer intelligently through this changing world. Also, charity leaders must prepare and plan for inevitable change in the sector.     

Positive uncertainty: the benefit of the doubt in advertising

Positive uncertainty refers to uncertainty surrounding an anticipated positive outcome. It provides consumers with the opportunity to imagine and speculate on a product's or experience's potentially positive characteristics. Research has shown that when uncertainty is associated with something positive, consumers may prefer uncertainty to certainty. In a between-subjects experimental design with a large US (n = 446) and Japanese sample (n = 453), the present study demonstrates that positive uncertainty increases consumers’ positive feelings when they evaluate a product, particularly for high-involvement products that allow consumers to imagine and speculate about potentially positive product benefits. Unexpectedly, the study findings are consistent across the two different markets, which vary substantially in terms of consumers’ level of uncertainty avoidance. Specifically, results show that future-framed advertisements are effective in generating positive uncertainty and that positive uncertainty generates positive attitudes, both in countries scoring high (Japan) and low (USA) on uncertainty avoidance.     

The Hero as Traveler,The Traveler as Hero

This article uses an insight from the French scholar Michel de Certeau to the effect that all stories are travel stories involving spatial transference and the theories of the Russian folklorist Vladimir Propp, as elaborated in his classic work Morphology of the Folktale, to argue all heroes are travelers of one sort or another. It suggests, that in addition to the fact that all heroes are travelers, all travelers are—broadly speaking—heroes and heroines.     

Risk as feelings or risk and feelings? A cross‐lagged panel analysis

This article focuses on affective and cognitive processes underlying the perception of risk. A limitation with most process models of affect/cognition is that they include only concurrent emotions. By following a group (n?=?129) of military sailors prospectively during an international operation, we explored longitudinal relations between perceived risk and related feelings.

Longitudinal cross‐lagged path models were estimated to explore the relationships between perceived risk, worry, and emotional distress. Results gave support to earlier studies by showing that cross‐sectional measures of risk and worry were weakly related. Across time, worry and emotional distress were reciprocally related. Perceived risk had impact on worry but not on emotional distress. Neither worry nor emotional distress influenced perceived risk.

The risk‐as‐feelings hypothesis postulates a direct effect of feelings onto behavioural choice, and a reciprocal relation between cognitive evaluations and feelings.

Our findings do not support a reciprocal relation between judgements of risk and feelings, but an impact from risk on to worry. Between various measures of feelings reciprocity seems to exist. Further replications, including also behavioural measures, are needed.     

Über die Berechnung der Leibrente bei Veränderung des Zinsfusses.

Abstract

Herr K. A. POUKKA hat in einer unter dem gleichem Titel erschienenen Arbeit¹ fü die zum Zinsfuss i+h zu berechnende Leibrente eine Näherungsformel. abgeleitet, welche sehr zufriedenstellende Resultate gibt. Die Formel wird aus der Reihenentwicklung gewonnen, für welche Herr POUKKA eine Ableitung mitteilt.     

Does it pay to have friends? Social ties and executive appointments in banking

We exploit a unique sample to analyze how homophily (affinity for similar others) and social ties affect career outcomes in banking. We test if these factors increase the probability that the appointee to an executive board is an outsider without previous employment at the bank compared to being an insider. Homophily based on age and gender increase the chances of the outsider appointments. Similar educational backgrounds, in contrast, reduce the chance that the appointee is an outsider. Greater social ties also increase the probability of an outside appointment. Results from a duration model show that larger age differences shorten tenure significantly, whereas gender similarities barely affect tenure. Differences in educational backgrounds affect tenure differently across the banking sectors. Maintaining more contacts to the executive board reduces tenure. We also find weak evidence that social ties are associated with reduced profitability, consistent with cronyism in banking.     

The hard shadow of the Greek economy: new estimates of the size of the underground economy and its fiscal impact

This article presents new estimates of the Greek underground economy and explores the link between the underground economy and aggregate debt. We show that the Greek underground economy has been underestimated heavily and has been on a rising trend again since Greece adopted the Euro. We also present evidence that the size of the underground economy is positively related to the debt-to-GDP ratio, implying that fighting the underground economy is also conducive to financial and macroeconomic stability. Our results suggest that for our sample of 11 EMU member countries, the loss of the inflation tax as an economic policy instrument had drastic consequences. While the underground economy did not have a statistically significant impact on aggregate debt before the introduction of the Euro, it has pushed up the debt-to-GDP ratio in our sample since.     

Do Alternative Real Estate Investment Vehicles Add Value to REITs? Evidence from German Open-ended Property Funds

Besides the more commonly used REITs, German investors can also invest in a lesser-known real estate vehicle, Open-ended Property Funds. OPFs are considered a compromise between listed and direct real estate investments. OPF fund managers generally provide daily (perfect) liquidity. However, if liquidity falls below 5%, share redemptions in these funds can be temporarily suspended for a period of up to two years. During this time, investors will only be able to sell shares on the secondary market (exchange), and are thus subject to significant liquidity risk. The objective of this paper is to analyze whether OPFs add value to investor portfolios above that provided by REITs. We show that OPFs have a diversification advantage over REITs in low-risk portfolios, despite their larger potential liquidity risk. REIT liquidity is comparable to that of ordinary common stock, but OPFs exhibit an average initial discount to funds’ NAV of about 6% when share redemptions are temporarily suspended. However, in the long-run, this potential redemption suspension does not negatively influence OPF performance (in case OPFs reopen again). This makes OPFs an attractive investment alternative to REITs for investors who have a high level of risk aversion and a long-term investment horizon, such as endowments, insurance companies, and pension funds.     

The impact of service innovation on firm-level financial performance

This article empirically investigates if firms focusing on service innovation perform better financially than firms not focusing on service innovation. Analysis of the financial performance of 3575 Norwegian firms in the manufacturing industries supports the proposition that firms focusing on service innovation have significantly higher growth of operating results than firms not focusing on service innovation. However, this proposition is not supported in a corresponding analysis of 1132 Norwegian firms in the service industries. We elaborate on these results by investigating a variety of performance measures and by comparing the effects of service innovation between manufacturing and service industries. The article contributes to the service innovation measurement literature and to a better general understanding of the determinants of service innovation performance effects.