Internationalization of Blue-Chip versus Mid-Cap Stock Indices: an Empirical Analysis for France,Germany, and the UK

The paper analyzes the question whether blue-chip stock indices provide a larger degree of internationalization than mid-cap stock indices. Specific focus lies on internationalization of indices in France, Germany, and the UK. Additionally, we analyze whether the degree of internationalization differs between industries. The dataset covers the CAC40, the DAX30 and the 30 largest firms in the FTSE100 as blue-chip indices and the CAC Next 20 and CAC Mid 60, the MDAX and TecDAX, and the remaining 70 companies in the FTSE100 as mid-cap indices. The comparison of blue-chip and mid-cap indices is based on three indicators of internationalization: percentages of employees based outside the firms’ home country, percentages of foreign sales, and percentages of foreign corporate tax payments. Blue-chip and mid-cap indices exhibit high levels of internationalization. Internationalization is stronger in German and UK blue-chip indices than in these countries’ mid-cap indices, whereas internationalization in French mid-cap and blue-chip indices is similar. Blue-chip and mid-cap firms in the energy/materials/utilities and industrials sectors exhibit similar levels of internationalization, whereas blue-chip firms in the consumer and health sectors exhibit higher levels than corresponding mid-cap firms. The research question and results are of particular importance for retail and institutional investors, because investing in indices typically represents a low cost alternative to individual stock picking. The question whether stock index characteristics, such as market capitalization and industry, influence the degree of international diversification within the index is largely unanswered in the literature. The paper addresses this question.     

How to build a factor portfolio: Does the allocation strategy matter?

Factor-based allocation embraces the idea of factors, as opposed to asset classes, as the ultimate building blocks of investment portfolios. We examine whether there is a superior way of combining factors in a portfolio and provide a comparison of factor-based allocation strategies within a multiple testing framework. Factor-based allocation is profitable beyond exploiting genuine risk premia, even when applying multiple testing corrections. Investment portfolios can be efficiently diversified using factor-based allocation strategies, as demonstrated by robust economic performance over various economic scenarios. The naïve equally weighted factor portfolio, albeit simple and cost-efficient, cannot be outperformed by more sophisticated allocation strategies.     

MRSA im Pflegeheim

Das müssen Sie im Umgang mit dem Problemkeim beachten - Der Anteil an multi resistenten Keimen in Krankenh?usern und Pflege einrichtungen ist in den letzten Jahren stark angestiegen: Bereits jeder fünfte Staphylococcus-aureus-Stamm gilt als methicillin resistent. Was muss im Umgang mit MRSA-Tr?gern und -Infizierten beachtet werden und wie wird eine effektive Sanierung durchgeführt?     

Investors' Personality Influences Investment Decisions: Experimental Evidence on Extraversion and Neuroticism

The authors analyze the impact of individuals' degree of extraversion and neuroticism on their decision making in an experimental asset market. To establish this link between research on experimental asset markets and social psychology the authors use a unique approach that combines a questionnaire designed to assess individuals' degree of extraversion and neuroticism and an experimental asset market to assess individual financial decision making. The dataset combines 364 undergraduate business students' questionnaire responses and their trading behavior in the asset market. The authors find that extraversion and neuroticism significantly influence individuals' behavior in the experimental asset market. Specifically, more extraverted individuals pay higher prices for financial assets and they buy more financial assets when assets are overpriced than less extraverted individuals do. More neurotic individuals hold less risky assets in their financial portfolios than less neurotic individuals do. Although a large part of the explanatory power appears to be driven by gender differences, the authors still find significant impact of extraversion and neuroticism after controlling for gender effects. The study findings suggest that further research on financial markets could benefit from including personality of market participants as a crucial explanatory factor.     

Retaliation: The form of 21st century employment discrimination

During the past decade, retaliation as a basis for employment discrimination claims has risen dramatically from fourth to second place (behind race), increasing by 46%. By definition, retaliation is the act of an employer, through a manager, inflicting an adverse action (such as discharge, discipline, or demotion) against an employee who has complained of discrimination. Retaliation claims open the possibility of punitive damages, examples of which are given in this article. Drawing 1361 cases from a 21-year database, we report the characteristics of retaliation claims and offer recommendations to prevent and manage such claims.