Introduction

2017 ◽  
Author(s):  
Gordon L. Clark ◽  
Ashby H. B. Monk
Keyword(s):  
Financial Markets ◽  
Institutional Investors ◽  
Financial Risk ◽  
Service Providers ◽  
Investment Strategies ◽  
Risk And Uncertainty ◽  
Key Points ◽  
Investment Returns ◽  
And Performance

It is acknowledged that institutional investors underpin the structure and performance of global financial markets. There is no doubt that the growth of institutional investors over the past fifty years has given global financial markets a remarkable depth of liquidity and scope of activities. At the same time, institutional investors rely on financial markets to frame and implement their investment strategies. Therefore, it is important to understand what is distinctive about this environment compared with those of other industries, especially manufacturing. In Chapter 1, the authors explain the significance of financial risk and uncertainty in the production of investment returns from a viewpoint of what could be termed a map of financial risk and uncertainty. The role and significance of institutional investors, including asset owners, managers and service providers, is highlighted. Concluding Chapter 1 is a summary of key points for the following chapters in the book.

Sovereign Development Funds

2017 ◽  
Author(s):  
Peter Bruce-Clark ◽  
Ashby H.B Monk
Keyword(s):  
Financial Markets ◽  
Global Economy ◽  
Private Investment ◽  
Dual Function ◽  
Investment Strategies ◽  
Objective Functions ◽  
Expected Return ◽  
Investment Returns ◽  
High Investment

In a slowing global economy with diminished confidence in the long-term prospects of public financial markets, many institutional investors are looking for innovative, and often private, investment strategies to meet expected return targets. One source of potential inspiration has, perhaps surprisingly, come from the community of sovereign development funds. SDFs are strategic, government-sponsored investment organizations with dual objective functions: to deliver high financial performance, while fostering development. Despite expectations that this dual function inevitably leads to financial underperformance, certain SDFs have actually delivered consistently high investment returns, especially in private markets. As such, SDF strategies are increasingly being used as models for investment strategies among non-developmental investment organizations. This chapter explores the rise of SDFs, explains the differences between SDFs and SWFs, and substantiates variations in their models of governance and management. In doing so, its goal is to situate SDFs in the changing world of global financial markets and public policy.

Review of Key Risk and Uncertainty Theories Influencing Contemporary Financial Economics

2012 ◽  
Vol 1 (4) ◽  
pp. 18-27 ◽  
Author(s):  
Colin Read
Keyword(s):  
Risk Management ◽  
Financial Markets ◽  
Financial Risk ◽  
Modern Science ◽  
Future Research ◽  
Additional Contribution ◽  
Credit Crisis ◽  
Risk And Uncertainty ◽  
Financial History ◽  
The Great Depression

Ironically, the 2008 credit crisis and the subsequent global financial meltdown were brought about by efforts of those whose stated purpose was to manage risk. Somehow, the efforts of financial regulators to manage and contain uncertainty created the greatest downside risk experienced since the Great Depression. At this juncture in financial history, it is purposeful to examine the meaning of risk and uncertainty, how it is priced, the assumptions one makes when one uses market-priced risk hedges, and the degree to which the modern science of financial risk management informs or obfuscates the very nature of risk. This paper performs such a retrospective analysis of key risk theories and how they impact financial markets, through the developments of innovators: Daniel Bernoulli, Carl Friedrich Gauss, Louis Bachelier, Jacob Marschak, Harry Markowitz, William Sharpe, Paul Samuelson, Fischer Black, and Myron Scholes. This paper makes an additional contribution to the literature by identifying unresolved issues that require additional research to improve risk management in financial markets. In particular, this paper concludes that while the author have numerous tools to manage risk, they have few tools to manage uncertainty, the latter of which is where future research should be undertaken.

scholarly journals Modernity, Imitation, and Performance: Sovereign Funds in the Gulf

2012 ◽  
Vol 14 (1) ◽  
pp. 1-22 ◽  
Author(s):  
Gordon L. Clark ◽  
Ashby Monk
Keyword(s):  
Financial Markets ◽  
Investment Strategies ◽  
Financial Assets ◽  
Global Order ◽  
Sovereign Wealth Funds ◽  
Nation States ◽  
Effective Performance ◽  
Gulf States ◽  
And Performance ◽  
Financial Capitalism

Whereas debate about sovereign wealth funds (SWFs) often focuses upon the global significance of their investment strategies, these institutions are also emblematic of the new global order of financial capitalism. SWFs are a mechanism for states to advance their interests through global financial markets and are a switch point for the translation of resource assets into financial assets in global markets. Yet, realising the promise of SWFs is not easy. The form and functions of these institutions are typically conceived in Western terms, so the necessary infrastructure for their effective performance may not exist in non-Western jurisdictions. Nonetheless, these funds have grown increasingly popular throughout the world. As such, this paper examines the process of SWF adoption in non-Western jurisdictions, and, in particular, SWFs' recent rise in popularity amongst the Gulf States. These countries are particularly interesting as they face a variety of challenges due to institutional contradictions between the norms of Western finance and the inherited traditions of the Gulf. While Gulf SWFs may be limited in their effectiveness, these funds still serve as an important symbol for the region, representing a formal gesture towards ‘modernity’ in the context of nation-states' inherited traditions.

Pricing models of shares of Russian companies and their practical application

2019 ◽  
pp. 48-76 ◽  
Author(s):  
Alexander E. Abramov ◽  
Alexander D. Radygin ◽  
Maria I. Chernova
Keyword(s):  
Stock Market ◽  
Institutional Investors ◽  
Factor Model ◽  
Investment Strategies ◽  
Pricing Models ◽  
Foreign Portfolio Investment ◽  
Market Portfolio ◽  
Stock Market Performance ◽  
Long Time ◽  
Russian Stock Market

The article analyzes the problems of applying stock pricing models in the Russian stock market. The novelty of the study lies in the peculiarities of the methodology used and the substantive conclusions on the specifics of the influence of fundamental factors on the pricing of shares of Russian companies. The study was conducted using its own 5-factor basic pricing model based on a sample of the most complete number of issues of shares of Russian issuers and a long time horizon, from 1997 to 2017. The market portfolio was the widest for a set of issuers. We consider the factor model as a kind of universal indicator of the efficiency of the stock market performance of its functions. The article confirms the significance of factors of a broad market portfolio, size, liquidity and, in part, momentum (inertia). However, starting from 2011, the significance of factors began to decrease as the qualitative characteristics of the stock market deteriorated due to the outflow of foreign portfolio investment, combined with the low level of development of domestic institutional investors. Also identified is the cyclical nature of the actions of company size and liquidity factors. Their ability to generate additional income on shares rises mainly at the stage of the fall of the stock market. The results of the study suggest that as domestic institutional investors develop on the Russian stock market, factor investment strategies can be used as a tool to increase the return on investor portfolios.

Pathways ahead for New Zealand hill country farming

2016 ◽  
Vol 78 ◽  
pp. 73-82 ◽  
Author(s):  
F.G. Scrimgeour
Keyword(s):  
New Zealand ◽  
Rural Communities ◽  
New Technologies ◽  
Service Providers ◽  
Farming Systems ◽  
Hill Country ◽  
The Status ◽  
And Performance ◽  
Hill Farming ◽  
The Hill

This paper provides a stocktake of the status of hill country farming in New Zealand and addresses the challenges which will determine its future state and performance. It arises out of the Hill Country Symposium, held in Rotorua, New Zealand, 12-13 April 2016. This paper surveys people, policy, business and change, farming systems for hill country, soil nutrients and the environment, plants for hill country, animals, animal feeding and productivity, and strategies for achieving sustainable outcomes in the hill country. This paper concludes by identifying approaches to: support current and future hill country farmers and service providers, to effectively and efficiently deal with change; link hill farming businesses to effective value chains and new markets to achieve sufficient and stable profitability; reward farmers for the careful management of natural resources on their farm; ensure that new technologies which improve the efficient use of input resources are developed; and strategies to achieve vibrant rural communities which strengthen hill country farming businesses and their service providers. Keywords: farming systems, hill country, people, policy, productivity, profitability, sustainability

The profitability of algorithmic trading systems based on football sentiment

2020 ◽  
Vol 42 (1) ◽  
pp. 33-46
Author(s):  
Raúl Gómez-Martínez ◽  
Camila Marqués-Bogliani ◽  
Jessica Paule-Vianez
Keyword(s):  
Financial Markets ◽  
Investment Decisions ◽  
Futures Market ◽  
Algorithmic Trading ◽  
Investment Strategies ◽  
Measurable Effect ◽  
Behavioural Finance ◽  
Trading Systems ◽  
European Football

Behavioural finance has shown that investment decisions are the result of not just rational but also emotional brain processes. On the assumption that emotions affect financial markets, it would seem likely that football results might have a measurable effect on financial markets. To test this, this study describes three algorithmic trading systems based exclusively on the results of three top European football teams (Juventus, Bayern München and Paris St Germain) opening long or short positions in the next market season of the futures market of the index of each country (MIB (Milano Italia Borsa), DAX (Deutscher Aktien Index) and CAC (Cotation Assistée en Continu). Depending on the outcome of the last game played a long position was taken after a victory and a short position after a draw or defeat. The results showed that the algorithmic systems were profitable in the case of Juventus and Bayern whereas in the case of PSG, the system was profitable, but in an inverse way. This study shows that investment strategies that take account of sports sentiment could have a profitable outcome.

scholarly journals A Comparative Analysis of Co-Production in Public Services

2021 ◽  
Vol 13 (12) ◽  
pp. 6730
Author(s):  
Pwint Kay Khine ◽  
Jianing Mi ◽  
Raza Shahid
Keyword(s):  
Public Administration ◽  
Service Providers ◽  
Research Trends ◽  
Future Research ◽  
Production Studies ◽  
Service Production ◽  
Production Research ◽  
Conceptual Paper ◽  
Structural Impacts ◽  
And Performance

This study investigates current research trends in co-production studies and discusses conceptual approaches. The conceptual paper contains studies on co-production in the field of public administration. This study identifies significant gaps in the field of study by systematically examining 32 co-production research works. The study’s contributions include (1) defining two common characteristics of co-production, (2) classifying three forms of co-production by end-users, and (3) discovering that the aims and performance of co-production are more effective for service providers when the strategy is citizen-centric. Future research should (1) concentrate on the reasons for co-production failures or successes, (2) identify additional barriers to co-production in service production, (3) investigate influences on service providers as well as structural impacts on the co-production process, and (4) provide practical assessments of co-production research.

scholarly journals Cross-section instability in financial markets: impatience, extrapolation, and switching

2021 ◽  
Author(s):  
Roberto Dieci ◽  
Xue-Zhong He
Keyword(s):  
Financial Markets ◽  
Cross Section ◽  
Asset Price ◽  
Asset Market ◽  
Long Run ◽  
Short Run ◽  
And Performance ◽  
Equilibrium Market ◽  
High Degree ◽  
Fundamental Price

AbstractThis paper presents a stylized model of interaction among boundedly rational heterogeneous agents in a multi-asset financial market to examine how agents’ impatience, extrapolation, and switching behaviors can affect cross-section market stability. Besides extrapolation and performance based switching between fundamental and extrapolative trading documented in single asset market, we show that a high degree of ‘impatience’ of agents who are ready to switch to more profitable trading strategy in the short run provides a further cross-section destabilizing mechanism. Though the ‘fundamental’ steady-state values, which reflect the standard present-value of the dividends, represent an unbiased equilibrium market outcome in the long run (to a certain extent), the price deviation from the fundamental price in one asset can spill-over to other assets, resulting in cross-section instability. Based on a (Neimark–Sacker) bifurcation analysis, we provide explicit conditions on how agents’ impatience, extrapolation, and switching can destabilize the market and result in a variety of short and long-run patterns for the cross-section asset price dynamics.

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