The valuation of European financial firms

We extend the recent literature concerning accounting based valuation models to investigate financial firms from six European countries with substantial financial sectors: France, Germany, Italy, Netherlands, Switzerland and the UK. Not only are these crucial industries worthy of study in their own right, but unusual accounting practices, and inter-country differences in those accounting practices, provide valuable insights into the accounting-value relationship. Our sample consists of 7,714 financial firm/years observations from 1,140 companies drawn from 1989-2000. Sub-samples include 1,309 firm/years for banks, 650 for insurance companies, 1,705 for real estate firms, and 3,239 for investment companies. In most countries we find that the valuation models work as well or better in explaining cross-sectional variations in the market-to-book ratio for financial firms as they do for industrial and commercial firms in the same countries, although Switzerland is an exception to this generalization. As expected, the results are sensitive to industrial differences, accounting regulation and accounting practices. In particular, marking assets to market value reduces the relevance of earnings figures and increases that of equity

Terminal valuations, growth rates and the implied cost of capital

This article is published with open access at Springerlink.comWe develop a model based on the notion that prices lead earnings, allowing for a simultaneous estimation of the implied growth rate and the cost of equity capital for US industrial sectors. The major difference between our approach and that in prior literature is that ours avoids the necessity to make assumptions about terminal values and consequently about future growth rates. In fact, growth rates are an endogenous variable, which is estimated simultaneously with the implied cost of equity capital. Since we require only 1-year-ahead forecasts of earnings and no assumptions about dividend payouts, our methodology allows us to estimate ex ante aggregate growth and risk premia over a larger sample of firms than has previously been possible. Our estimate of the risk premium being between 3.1 and 3.9 % is at the lower end of recent estimates, reflecting the inclusion of these short-lived companies. Our estimate of the long run growth is from 4.2 to 4.7 %

Soil methane sink capacity response to a long-term wildfire chronosequence in Northern Sweden

Boreal forests occupy nearly one fifth of the terrestrial land surface and are recognised as globally important regulators of carbon (C) cycling and greenhouse gas emissions. Carbon sequestration processes in these forests include assimilation of CO2 into biomass and subsequently into soil organic matter, and soil microbial oxidation of methane (CH4). In this study we explored how ecosystem retrogression, which drives vegetation change, regulates the important process of soil CH4 oxidation in boreal forests. We measured soil CH4 oxidation processes on a group of 30 forested islands in northern Sweden differing greatly in fire history, and collectively representing a retrogressive chronosequence, spanning 5000 years. Across these islands the build-up of soil organic matter was observed to increase with time since fire disturbance, with a significant correlation between greater humus depth and increased net soil CH4 oxidation rates. We suggest that this increase in net CH4 oxidation rates, in the absence of disturbance, results as deeper humus stores accumulate and provide niches for methanotrophs to thrive. By using this gradient we have discovered important regulatory controls on the stability of soil CH4 oxidation processes that could not have not been explored through shorter-term experiments. Our findings indicate that in the absence of human interventions such as fire suppression, and with increased wildfire frequency, the globally important boreal CH4 sink could be diminished

Strangeness Enhancement in Cu+Cu and Au+Au Collisions at \sqrt{s_{NN}} = 200 GeV

We report new STAR measurements of mid-rapidity yields for the $\Lambda$, $\bar{\Lambda}$, $K^{0}_{S}$, $\Xi^{-}$, $\bar{\Xi}^{+}$, $\Omega^{-}$, $\bar{\Omega}^{+}$ particles in Cu+Cu collisions at \sNN{200}, and mid-rapidity yields for the $\Lambda$, $\bar{\Lambda}$, $K^{0}_{S}$ particles in Au+Au at \sNN{200}. We show that at a given number of participating nucleons, the production of strange hadrons is higher in Cu+Cu collisions than in Au+Au collisions at the same center-of-mass energy. We find that aspects of the enhancement factors for all particles can be described by a parameterization based on the fraction of participants that undergo multiple collisions

Studies of di-jet survival and surface emission bias in Au+Au collisions via angular correlations with respect to back-to-back leading hadrons

We report first results from an analysis based on a new multi-hadron correlation technique, exploring jet-medium interactions and di-jet surface emission bias at RHIC. Pairs of back-to-back high transverse momentum hadrons are used for triggers to study associated hadron distributions. In contrast with two- and three-particle correlations with a single trigger with similar kinematic selections, the associated hadron distribution of both trigger sides reveals no modification in either relative pseudo-rapidity or relative azimuthal angle from d+Au to central Au+Au collisions. We determine associated hadron yields and spectra as well as production rates for such correlated back-to-back triggers to gain additional insights on medium properties.Comment: By the STAR Collaboration. 6 pages, 2 figure

Inclusive charged hadron elliptic flow in Au + Au collisions at sNN\sqrt{s_{NN}} = 7.7 - 39 GeV

A systematic study is presented for centrality, transverse momentum ($p_T$) and pseudorapidity ($\eta$) dependence of the inclusive charged hadron elliptic flow ($v_2$) at midrapidity($|\eta| < 1.0$) in Au+Au collisions at $\sqrt{s_{NN}}$ = 7.7, 11.5, 19.6, 27 and 39 GeV. The results obtained with different methods, including correlations with the event plane reconstructed in a region separated by a large pseudorapidity gap and 4-particle cumulants ($v_2{4}$), are presented in order to investigate non-flow correlations and $v_2$ fluctuations. We observe that the difference between $v_2{2}$ and $v_2{4}$ is smaller at the lower collision energies. Values of $v_2$, scaled by the initial coordinate space eccentricity, $v_{2}/\varepsilon$, as a function of $p_T$ are larger in more central collisions, suggesting stronger collective flow develops in more central collisions, similar to the results at higher collision energies. These results are compared to measurements at higher energies at the Relativistic Heavy Ion Collider ($\sqrt{s_{NN}}$ = 62.4 and 200 GeV) and at the Large Hadron Collider (Pb + Pb collisions at $\sqrt{s_{NN}}$ = 2.76 TeV). The $v_2(p_T)$ values for fixed $p_T$ rise with increasing collision energy within the $p_T$ range studied ($< 2 {\rm GeV}/c$). A comparison to viscous hydrodynamic simulations is made to potentially help understand the energy dependence of $v_{2}(p_{T})$. We also compare the $v_2$ results to UrQMD and AMPT transport model calculations, and physics implications on the dominance of partonic versus hadronic phases in the system created at Beam Energy Scan (BES) energies are discussed.Comment: 20 pages, 12 figures. Version accepted by PR

Measurements of D0D^{0} and D∗D^{*} Production in pp + pp Collisions at s\sqrt{s} = 200 GeV

We report measurements of charmed-hadron ($D^{0}$, $D^{*}$) production cross sections at mid-rapidity in $p$ + $p$ collisions at a center-of-mass energy of 200 GeV by the STAR experiment. Charmed hadrons were reconstructed via the hadronic decays $D^{0}\rightarrow K^{-}\pi^{+}$, $D^{*+}\rightarrow D^{0}\pi^{+}\rightarrow K^{-}\pi^{+}\pi^{+}$ and their charge conjugates, covering the $p_T$ range of 0.6$-$2.0 GeV/$c$ and 2.0$-$6.0 GeV/$c$ for $D^{0}$ and $D^{*+}$, respectively. From this analysis, the charm-pair production cross section at mid-rapidity is $d\sigma/dy|_{y=0}^{c\bar{c}}$ = 170 $\pm$ 45 (stat.) $^{+38}_{-59}$ (sys.) $\mu$b. The extracted charm-pair cross section is compared to perturbative QCD calculations. The transverse momentum differential cross section is found to be consistent with the upper bound of a Fixed-Order Next-to-Leading Logarithm calculation.Comment: 15 pages, 16 figures. Revised version submitted to Phys. Rev.

Observation of the antimatter helium-4 nucleus

High-energy nuclear collisions create an energy density similar to that of the universe microseconds after the Big Bang, and in both cases, matter and antimatter are formed with comparable abundance. However, the relatively short-lived expansion in nuclear collisions allows antimatter to decouple quickly from matter, and avoid annihilation. Thus, a high energy accelerator of heavy nuclei is an efficient means of producing and studying antimatter. The antimatter helium-4 nucleus ($^4\bar{He}$), also known as the anti-{\alpha} ($\bar{\alpha}$), consists of two antiprotons and two antineutrons (baryon number B=-4). It has not been observed previously, although the {\alpha} particle was identified a century ago by Rutherford and is present in cosmic radiation at the 10% level. Antimatter nuclei with B < -1 have been observed only as rare products of interactions at particle accelerators, where the rate of antinucleus production in high-energy collisions decreases by about 1000 with each additional antinucleon. We present the observation of the antimatter helium-4 nucleus, the heaviest observed antinucleus. In total 18 $^4\bar{He}$ counts were detected at the STAR experiment at RHIC in 10$^9$ recorded Au+Au collisions at center-of-mass energies of 200 GeV and 62 GeV per nucleon-nucleon pair. The yield is consistent with expectations from thermodynamic and coalescent nucleosynthesis models, which has implications beyond nuclear physics.Comment: 19 pages, 4 figures. Submitted to Nature. Under media embarg