Modelling Extreme Market Events. A Report of the Benchmarking Stochastic Models Working Party

2009 ◽  
Vol 15 (1) ◽  
pp. 99-201 ◽  
Author(s):  
R. Frankland ◽  
A. D. Smith ◽  
T. Wilkins ◽  
E. Varnell ◽  
A. Holtham ◽  
...  
Keyword(s):  
Interest Rate ◽  
Stochastic Models ◽  
Financial Services ◽  
Working Party ◽  
Prior Beliefs

ABSTRACTThis paper focusses on some practical issues that can arise when developing methodologies for calculating benchmark figures for extreme market events, particularly in the context of the Financial Services Authority's ICAS regime. The paper limits discussion to equity and interest rate risks. Whilst not intended to constitute formal guidance, it is hoped that the material contained within the paper will be useful to practitioners. The paper acknowledges the role of prior beliefs in the choice of data to be used for modelling and its influence upon the ensuing results.

scholarly journals Access to Banking and the Role of Inequality and the Financial Crisis

2021 ◽  
Vol 0 (0) ◽  
Author(s):  
Mauro Caselli ◽  
Babak Somekh
Keyword(s):  
Interest Rate ◽  
Financial Crisis ◽  
Financial Services ◽  
Income Disparities ◽  
Consumer Population ◽  
Alternative Financial Services ◽  
The 2008 Financial Crisis ◽  
The Interest Rate ◽  
Distribution Of Income

Abstract We study access to banking and how it is related to banks’ rate of return on investments and the distribution of income. We develop our empirical framework through a theoretical supply-side model of bank deposit services with a consumer population heterogeneous in income. We use this model to show how decreases in the interest rate margin and higher income disparities lead to an increase in the proportion of unbanked. Using localized US household data from 2009, 2011, 2013 and 2015 we find strong empirical evidence for the predictions of the model. We then structurally estimate our model to estimate the value of having a checking account relative to alternative financial services and to quantify the effects of actual changes in the interest rate margin and the distribution of income that occurred in the aftermath of the 2008 financial crisis.

Financial Services and Investment Markets in a Low Inflationary Environment

1999 ◽  
Vol 5 (5) ◽  
pp. 851-897 ◽  
Author(s):  
P.J. Nowell ◽  
J.R. Crispin ◽  
M. Iqbal ◽  
S.F. Margutti ◽  
A. Muldoon
Keyword(s):  
Financial Services ◽  
Working Party ◽  
Research Committee ◽  
Net Returns ◽  
Term Insurance ◽  
Insurance Business ◽  
Set Up ◽  
The Impact

ABSTRACTA working party was set up in February 1999 by the Research Committee of the Life Board to consider the impact of a low inflationary environment on the financial services and investment markets with particular emphasis on companies conducting long-term insurance business.The working party has produced an interim report which reviews the causes of the present expectation of low inflation and discusses evidence from the past and the role of demographics. It considers issues surrounding the composition of the retail price index, appropriate economic assumptions and the impact on investment markets, including the effect of charges on net returns to savers. The position of long-term insurance business is then considered in more detail, looking at HM Treasury return consequences as well as disclosure and product design features. Finally, there are two investigations, the first looking at the effect of low inflation on the achieved profits derived from different product designs, and the second looking at the changes in ruin probability for a with-profits office associated with declining inflation.

STATE REGULATION OF THE FINANCIAL SERVICES MARKET IN UKRAINE

2018 ◽  
Vol 1 (11) ◽  
pp. 30-47
Author(s):  
Lyudmila Nikolayevna Akimova ◽  
Alla Vasilievna Lysachok
Keyword(s):  
Life Insurance ◽  
Financial Services ◽  
Credit Unions ◽  
State Regulation ◽  
The State ◽  
Existing Problems ◽  
Insurance Contracts ◽  
State Pension

The essence of such concepts is “financial service”, “financial ser- vices market”, and “participants of the financial services market”; determined the purpose of state regulation of the financial services market; forms of state regu- lation of the financial services market; financial services that are present in the financial services market; the structure of state regulation bodies of the financial services market in Ukraine is given; The role of state bodies in the regulation of the financial services market was studied; to characterize the regulatory le- gal regulation of the financial services market in Ukraine; the main problems of functioning of the domestic market of financial services are revealed; ways to solve existing problems. It is grounded that the state regulation of financial ser- vices markets consists in the state’s implementation of a set of measures aimed at regulating and overseeing financial services markets to protect the interests of financial services consumers and preventing crisis phenomena. It is concluded that the financial services market is an important element of the development of the economy as a whole, in particular, it concerns not only the state but also society. We must understand that when this market is settled, that is, all bodies that carry out state regulation are competent in their powers, only then will we make informed, effective decisions about the normal and effective functioning of the RFP. It is important that the data of the subjects of control do not overlap, their activities should be fixed at the legislative level. It is also worth bearing in mind that appropriate conditions must be created to create compensatory mecha- nisms in the financial services markets by developing a system for guarante- eing deposits and providing for payments under long-term life insurance contracts, non-state pension provisions, deposits with deposit accounts to credit unions, etс.

Reducing misperceptions through news stories with data visualization: The role of readers’ prior knowledge and prior beliefs

Journalism ◽  
2021 ◽  
pp. 146488492110287
Author(s):  
Paul Mena
Keyword(s):  
Experimental Design ◽  
Prior Knowledge ◽  
Data Visualization ◽  
Accurate Information ◽  
Graphical Representations ◽  
Prior Beliefs ◽  
News Stories ◽  
Issue Involvement

Amid the global discussion on ways to fight misinformation, journalists have been writing stories with graphical representations of data to expose misperceptions and provide readers with more accurate information. Employing an experimental design, this study explored to what extent news stories correcting misperceptions are effective in reducing them when the stories include data visualization and how influential readers’ prior beliefs, issue involvement and prior knowledge may be in that context. The study found that the presence of data visualization in news articles correcting misperceptions significantly enhanced the reduction of misperceptions among news readers with less than average prior knowledge about an issue. In addition, it was found that prior beliefs had a significant effect on news readers’ misperceptions regardless of the presence or absence of data visualization. In this way, this research offers some support for the notion that data visualization may be useful to decrease misperceptions under certain circumstances.

scholarly journals Optimistic amnesia: how online and offline processing shape belief updating and memory biases in immediate and long-term optimism biases

2021 ◽  
Author(s):  
Ziqing Yao ◽  
Xuanyi Lin ◽  
Xiaoqing Hu
Keyword(s):  
Active Role ◽  
Prior Beliefs ◽  
Belief Updating ◽  
Estimation Task ◽  
Memory Biases ◽  
Brain Potentials ◽  
Adverse Life Event ◽  
Offline Processing

Abstract When people are confronted with feedback that counters their prior beliefs, they preferentially rely on desirable rather than undesirable feedback in belief updating, i.e. an optimism bias. In two pre-registered EEG studies employing an adverse life event probability estimation task, we investigated the neurocognitive processes that support the formation and the change of optimism biases in immediate and 24 h delayed tests. We found that optimistic belief updating biases not only emerged immediately but also became significantly larger after 24 h, suggesting an active role of valence-dependent offline consolidation processes in the change of optimism biases. Participants also showed optimistic memory biases: they were less accurate in remembering undesirable than desirable feedback probabilities, with inferior memories of undesirable feedback associated with lower belief updating in the delayed test. Examining event-related brain potentials (ERPs) revealed that desirability of feedback biased initial encoding: desirable feedback elicited larger P300s than undesirable feedback, with larger P300 amplitudes predicting both higher belief updating and memory accuracies. These results suggest that desirability of feedback could bias both online and offline memory-related processes such as encoding and consolidation, with both processes contributing to the formation and change of optimism biases.

scholarly journals Exploring the Role of Islamic Fintech in Combating the Aftershocks of COVID-19: The Pen Social Innovation of the Islamic Financial System

2021 ◽  
Vol 7 (2) ◽  
pp. 136
Author(s):  
Mustafa Raza Rabbani ◽  
Abu Bashar ◽  
Nishad Nawaz ◽  
Sitara Karim ◽  
Mahmood Asad Mohd. Ali ◽  
...  
Keyword(s):  
Financial Services ◽  
Open Innovation ◽  
Financial Stability ◽  
Social Innovation ◽  
Global Financial Crisis ◽  
Financial System ◽  
Real Economy ◽  
Business Context ◽  
The World

The purpose of the current study is to investigate the role of the Islamic financial system in recovery post-COVID-19 and the way Fintech can be utilized to combat the economic reverberations created by COVID-19. The global financial crisis of 2008 has established the credentials of the Islamic financial system as a sustainable financial system which can save the long run interests of the average citizens around the world while adding value to the real economy. The basic ethical tenets available in the Islamic financial system make it more suited and readymade to fight the economic aftershocks of a pandemic like COVID-19. The basic principles of ethical Islamic finance have solid connections to financial stability and corporate social responsibility within the wide-reaching business context. With the emergence of Financial technology (Fintech) it has provided a missing impetus to the Islamic financial system to compete on equal ground with its conventional counterpart and prove its mettle. The study uses discourse analysis along with the content analysis to extract content and draw a conclusion. The findings of the study indicate that COVID-19 pandemic has provided the opportunity for the social and open innovation to grow and finance world have turned to open innovation to provide a speedy, timely, reliable, and sustainable solution to the world. The findings of the study provide significant implications for governments and policy makers in efficient application of Fintech and innovative Islamic financial services to fight the economic consequences of the COVID-19 pandemic.

Monitoring Compliance with Professional Guidance. A Discussion Paper prepared by the Compliance/Peer Review Working Party of the Professional Affairs Board

2000 ◽  
Vol 6 (2) ◽  
pp. 365-431
Keyword(s):  
Peer Review ◽  
Financial Services ◽  
Working Party ◽  
Professional Conduct ◽  
Discussion Paper ◽  
Professional Guidance

ABSTRACTThis is a discussion paper prepared by the Compliance/Peer Review Working Party of the Professional Affairs Board. It considers the monitoring of compliance with the professional conduct standard and guidance notes, how this is being done, and whether changes need to be made to the monitoring in the light of on-going changes to the regulation of financial services.

The Appointed Actuary.

1987 ◽  
Vol 41 ◽  
pp. 559-629
Author(s):  
Edward A. Johnston
Keyword(s):  
Life Insurance ◽  
Financial Services ◽  
Self Regulation ◽  
Professional Role ◽  
The Self ◽  
Insurance Companies ◽  
Prudential Supervision ◽  
Government Supervision ◽  
The Uk

1.1 A paper about the Appointed Actuary is essentially a paper about prudential supervision of life insurance companies. The system which has operated in the UK since the mid-1970's is only partly one of Government supervision. Through the professional role of the Appointed Actuary, it also contains elements of a system of self-regulation with the Institute and Faculty of Actuaries standing in place of SRO's. Unlike the self-regulatory arrangements of the Financial Services Act. though, this second part of the system has grown up by custom and practice and in certain respects it is not codified. However it enables the Insurance Companies Act to be operated successfully.

PSYCHOLOGICAL ASPECTS OF ORGANIZATION OF FRAUD SCHEMES IN THE FIELD OF THE FINANCIAL MARKET

2021 ◽  
Vol 1 (12) ◽  
pp. 69-77
Author(s):  
Аleksey V. Zverev ◽  
◽  
Marina Yu. Mishina ◽  
Andrey V. Novikov ◽  
◽  
...  
Keyword(s):  
Critical Thinking ◽  
Financial Market ◽  
Financial Services ◽  
Psychological Aspects ◽  
Financial Fraud ◽  
Stressful Situation ◽  
Potential Victim ◽  
The Stability ◽  
The Relationship

This article reflects the peculiarities of the psychological connection between a financial fraudster and his potential victim. The process of forming a stressful situation depending on the type of financial fraud is described, the reasons for its occurrence and the result of implementation associated with a decrease in critical thinking are indicated. The essence is also revealed, including from the perspective of the relationship between the fraudster and the potential victim, and the types of financial fraud and practical examples of their manifestation are considered. The psychological portrait of a financial fraudster and his transformation in connection with the changing preferences of consumers of financial services are described. The role of the Bank of Russia in reducing the activity of financial fraud and ensuring the stability of the financial market is reflected.

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