Ranking, risk-taking and effort: an analysis of the ECB's foreign reserves management

The investment of the ECB reserves in US dollars and yen, delegated to a network of portfolio managers in the Eurosystem’s national central banks, involves a periodic assessment of performance against a common benchmark, controlled by the ECB and subject to revision on a monthly basis. Monetary reward for the best performers is almost entirely absent, and compensation comes mainly as reputational credit following the transmission of the annual report to the Governing Council. Employing a new data set on individual portfolio variables during 2002-2009, we study this peculiar tournament and show the existence of risk-shifting behaviour by reserve managers related to their year-to-date ranking: interim losers increase relative risk in the second half of the year, in the same way as mutual fund managers. In the dollar case, risk-shifting is asymmetric: the adjustment to ranking is generally reduced or entirely offset if reserve managers have achieved a positive interim performance against the benchmark. Yen reserve managers that rank low show a tendency to increase effort, as proxied by portfolio turnover. We also find that reserve managers who ranked low in the previous year tend to reduce risk significantly. Our evidence is consistent with a reserve managers’ anecdote, according to which they obtain a concave reputational reward within their national central banks, which induces risk aversion and explains the observed low usage of the risk budget. Since reserve managers should have a comparative advantage over the tactical benchmark within a monthly horizon, possible enhancements to the design of the tournament are discussed. These might involve an increased reward for effort and performance by means of a convex scoring system linked to monthly, rather than annual, performance. JEL Classification: G11, E58, D81Delegated portfolio management, effort, Foreign reserves, incentives, tournament

Ranking, risk-taking and effort: an analysis of the ECB's foreign reserves management

The investment of the ECB reserves in US dollars and yen involves an annual performance assessment of portfolio managers, located in the Eurosystem’s national central banks. Employing new data on individual portfolios during 2002-2009, we study this peculiar tournament and show the existence of risk-shifting behaviour by reserve managers related to their year-to-date ranking: interim losers increase relative risk in the second half of the year, in the same way as mutual fund managers. In the dollar case the adjustment to ranking is reduced or offset if reserve managers have achieved a positive interim performance against the benchmark. Yen reserve managers that rank low show a tendency to increase effort, as proxied by portfolio turnover. Those who ranked low in the previous year tend to reduce risk significantly. Since reserve managers should have a comparative advantage over the benchmark within a monthly horizon, possible enhancements to the design of the tournament might involve an increased reward for effort and performance by means of a convex scoring system linked to monthly, rather than annual, performance.foreign exchange reserves, tournament, incentives, effort, portfolio management

Flat Choroidal Nevus Inaccessible to Ultrasound Sonography Evaluated by Enhanced Depth Imaging Optical Coherence Tomography

Purpose: To demonstrate the usefulness of enhanced depth imaging optical coherence tomography (EDI-OCT) in investigating choroidal lesions inaccessible to ultrasound sonography. Methods: In a 60-year-old woman with an asymptomatic choroidal nevus, normal OCT was used to observe the macula and EDI-OCT to image the choroidal nevus that was inaccessible to ultrasound. The exact location of the lesion in the choroid and the dimensions of the nevus were measured. Results: The lesion was located in the superior macula, and the nevus was homogeneous in its reflectivity. We observed a thickened choroid delineated by the shadow cone behind it, measuring 1,376 × 325 µm in the larger vertical cut and 1,220 × 325 µm in the larger horizontal cut in an image with a 1:1 pixel mapping and automatic zoom. The macular profile and thickness were both normal. Conclusions: EDI-OCT appears to be an excellent technique for measuring choroidal nevi and all choroidal lesions accessible to OCT imaging by depicting their exact location in the choroid, their dimensions, and their demarcation from the surrounding healthy tissue, thus allowing for a more efficient and accurate follow-up

“En-Face” Spectral-Domain Optical Coherence Tomography Findings in Multiple Evanescent White Dot Syndrome

Purpose. The recent use of “en-face” enhanced-depth imaging spectral-domain optical coherence tomography (EDI SD-OCT) helps distinguish the retinal layers involved in the physiopathology of multiple evanescent white dot syndrome (MEWDS). Methods. Four patients presenting with MEWDS underwent a comprehensive ocular examination including C-scan (“en-face”) EDI SD-OCT at the initial visit and during follow-up. Results. C-scans combined with the other multimodal imaging enabled the visualization of retinal damage. Acute lesions appeared as diffuse and focal disruptions occurring in the ellipsoid and interdigitation zones. The match between autofluorescence imaging, indocyanine green angiography, and “en-face” OCT helped identify the acute microstructural damages in the outer retina further than the choroid. Follow-up using “en-face” EDI-OCT revealed progressive and complete recovery of the central outer retinal layers. Conclusion. “En-face” EDI SD-OCT identified the site of initial damage in MEWDS as the photoreceptors and the interdigitation layers rather than the choroid. Moreover, “en-face” OCT is helpful in the follow-up of these lesions by being able to show the recovery of the outer retinal layers

En Face OCT Imaging for the Diagnosis of Outer Retinal Tubulations in Age-Related Macular Degeneration

Purpose. “En face” is an emerging imaging technique derived from spectral domain optical coherence tomography (OCT). It produces frontal sections of retinal layers, also called “C-scan OCT.” Outer retinal tubulations (ORTs) in age-related macular degeneration (AMD) are a recent finding evidenced by spectral-domain OCT. The aim of this study is to characterize the morphology of ORT according to the form of AMD, using “en-face” spectral domain OCT. Methods. “En face” OCT imaging was prospectively performed in 26 consecutive eyes with AMD that also had ORT. Results. There were 15 neovascular, 8 atrophic, and 3 eyes with a mixed (fibrotic and atrophic) form of AMD. Among the neovascular group, the most frequent tubulation pattern on “en-face” OCT was a branching network emanating from a fibrovascular scar; we term this pattern as “pseudodendritic.” It did not require treatment when observed as an isolated finding. In all cases of atrophic AMD, the tubular network was located at the edge of the geographic atrophy area, and formed a “perilesional” pattern. Six atrophic cases showed tubular invaginations inside this area. Conclusion. “En face” OCT is a valuable technique in the diagnosis and followup of macular disease. It revealed the main characteristic patterns of ORT associated with neovascular and atrophic AMD

Microcystic Changes in the Retinal Internal Nuclear Layer Associated with Optic Atrophy: A Prospective Study

Purpose. This study aimed at assessing the prevalence of pathologies presenting retinal inner nuclear layer (RINL) microcystic perimacular changes associated with optic nerve atrophy (OA). The charts of patients presenting a significant defect of the Retinal Nerve Fiber Layer (RNFL) were included prospectively in this study. Patients were classified according to the etiology of the RNFL defect. Two hundred and one eyes of 138 patients were enrolled in this analysis. Retinal images obtained showed the typical hyporeflective perifoveal crescent-shaped lesion composed of small round hyporeflective microcysts confined to the RINL in 35.3% of the eyes. Those findings were found in 75% of eyes presenting hereditary OA, 50% of eyes presenting ischemic optic neuritis, 50% of eyes with drusen of the optic nerve (ON), 44.4% of eyes presenting a compressive OA, 32% of eyes presenting inflammatory optic neuropathy from multiple sclerosis, 18.5% of eyes presenting OA from undetermined origin, and 17.6% of eyes having primary open-angle glaucoma. This study demonstrates that microcystic changes in RINL are not specific to a disease but are found in OA of various etiologies. Moreover, their incidence was found to be dependent upon the cause of OA, with the highest incidence occurring in genetic OA

Mapping development and health effects of cooking with solid fuels in low-income and middle-income countries, 2000-18 : a geospatial modelling study

Background More than 3 billion people do not have access to clean energy and primarily use solid fuels to cook. Use of solid fuels generates household air pollution, which was associated with more than 2 million deaths in 2019. Although local patterns in cooking vary systematically, subnational trends in use of solid fuels have yet to be comprehensively analysed. We estimated the prevalence of solid-fuel use with high spatial resolution to explore subnational inequalities, assess local progress, and assess the effects on health in low-income and middle-income countries (LMICs) without universal access to clean fuels.Methods We did a geospatial modelling study to map the prevalence of solid-fuel use for cooking at a 5 km x 5 km resolution in 98 LMICs based on 2.1 million household observations of the primary cooking fuel used from 663 population-based household surveys over the years 2000 to 2018. We use observed temporal patterns to forecast household air pollution in 2030 and to assess the probability of attaining the Sustainable Development Goal (SDG) target indicator for clean cooking. We aligned our estimates of household air pollution to geospatial estimates of ambient air pollution to establish the risk transition occurring in LMICs. Finally, we quantified the effect of residual primary solid-fuel use for cooking on child health by doing a counterfactual risk assessment to estimate the proportion of deaths from lower respiratory tract infections in children younger than 5 years that could be associated with household air pollution.Findings Although primary reliance on solid-fuel use for cooking has declined globally, it remains widespread. 593 million people live in districts where the prevalence of solid-fuel use for cooking exceeds 95%. 66% of people in LMICs live in districts that are not on track to meet the SDG target for universal access to clean energy by 2030. Household air pollution continues to be a major contributor to particulate exposure in LMICs, and rising ambient air pollution is undermining potential gains from reductions in the prevalence of solid-fuel use for cooking in many countries. We estimated that, in 2018, 205000 (95% uncertainty interval 147000-257000) children younger than 5 years died from lower respiratory tract infections that could be attributed to household air pollution.Interpretation Efforts to accelerate the adoption of clean cooking fuels need to be substantially increased and recalibrated to account for subnational inequalities, because there are substantial opportunities to improve air quality and avert child mortality associated with household air pollution. Copyright (C) 2022 The Author(s). Published by Elsevier Ltd.Peer reviewe