Financial Management articles from September 2008

Financial Management archives from September 2008

How much does expertise reduce behavioral biases? The case of anchoring effects in stock return estimates.(Report)
September 22, 2008... We use data from surveys involving 300 Scandinavian financial market professionals and 213 university students to conduct three controlled experiments in which we manipulate the background information given to subjects. We find a very large...

Corporate debt issuance and the historical level of interest rates.(Report)
September 22, 2008... Using a sample that comprises more than 14,000 new issues of corporate debt for the period 1970-2001, we examine the relation between debt issues and the level of interest rates relative to historical levels. Consistent with recent survey...

Earnings and equity valuation in the biotech industry: theory and evidence.(Report)
September 22, 2008... We examine how the price-earnings relation varies with the uncertainty about and the quality of a firm's investments. We develop a real option valuation framework to capture investment and abandonment options in the research-intensive...

Does financial distress risk drive the momentum anomaly?(Report)
September 22, 2008... This paper brings together the evidence on two asset pricing anomalies--continuation of prior returns (momentum) and the market mispricing of distressed firms--using UK data. Our analysis demonstrates both these effects are driven by market...

What is the cost of financial flexibility? Theory and evidence for make-whole call provisions.(Report)
September 22, 2008... Firms commonly incorporate make-whole call provisions in their newly issued debt, presumably to improve their ability to retire debt early if circumstances require. In return for increased financial flexibility, firms must compensate...

Portfolio manager ownership and mutual fund performance.(Report)
September 22, 2008... This paper examines the association between a mutual fund manager's personal fund investment and mutual fund performance. From a data set of newly released managerial ownership disclosures, I find that fund ownership levels are diverse and, in...

The impact of past syndicate alliances on the consolidation of financial institutions.(Report)
September 22, 2008... The impact of past syndicate alliances on the consolidation of financial institutions is examined. The odds of two lenders combining increases with the intensity and exclusivity of their prior syndicated loan alliances. The impact is higher for...

How Preussag became TUI: a clinical study of institutional blockholders and restructuring in Europe.(Report)(Company overview)
September 22, 2008... Between 1997 and 2004, Preussag, a diversified German conglomerate of "old economy" businesses, transformed itself into TUI, a company focused almost entirely on tourism and logistics. We analyze how Preussag executed this change, and how the...