Optimal client recommendation for market makers in illiquid financial products

The process of liquidity provision in financial markets can result in prolonged exposure to illiquid instruments for market makers. In this case, where a proprietary position is not desired, pro-actively targeting the right client who is likely to be interested can be an effective means to offset this position, rather than relying on commensurate interest arising through natural demand. In this paper, we consider the inference of a client profile for the purpose of corporate bond recommendation, based on typical recorded information available to the market maker. Given a historical record of corporate bond transactions and bond meta-data, we use a topic-modelling analogy to develop a probabilistic technique for compiling a curated list of client recommendations for a particular bond that needs to be traded, ranked by probability of interest. We show that a model based on Latent Dirichlet Allocation offers promising performance to deliver relevant recommendations for sales traders.Comment: 12 pages, 3 figures, 1 tabl

Biotic resistance to invasion along an estuarine gradient

Biotic resistance is the ability of native communities to repel the establishment of invasive species. Predation by native species may confer biotic resistance to communities, but the environmental context under which this form of biotic resistance occurs is not well understood. We evaluated several factors that influence the distribution of invasive Asian mussels (Musculista senhousia) in Mission Bay, a southern California estuary containing an extensive eelgrass (Zostera marina) habitat. Asian mussels exhibit a distinct spatial pattern of invasion, with extremely high densities towards the back of Mission Bay (up to 4,000 m−2) in contrast with near-complete absence at sites towards the front of the bay. We established that recruits arrived at sites where adult mussels were absent and found that dense eelgrass does not appear to preclude Asian mussel growth and survival. Mussel survival and growth were high in predator-exclusion plots throughout the bay, but mussel survival was low in the front of the bay when plots were open to predators. Additional experiments revealed that consumption by spiny lobsters (Panulirus interruptus) and a gastropod (Pteropurpura festiva) likely are the primary factors responsible for resistance to Asian mussel invasion. However, biotic resistance was dependent on location within the estuary (for both species) and also on the availability of a hard substratum (for P. festiva). Our findings indicate that biotic resistance in the form of predation may be conferred by higher order predators, but that the strength of resistance may strongly vary across estuarine gradients and depend on the nature of the locally available habitat

Shorter Food Chain Length in Ancient Lakes: Evidence from a Global Synthesis

Food webs may be affected by evolutionary processes, and effective evolutionary time ultimately affects the probability of species evolving to fill the niche space. Thus, ecosystem history may set important evolutionary constraints on community composition and food web structure. Food chain length (FCL) has long been recognized as a fundamental ecosystem attribute. We examined historical effects on FCL in large lakes spanning >6 orders of magnitude in age. We found that food chains in the world’s ancient lakes (n = 8) were significantly shorter than in recently formed lakes (n = 10) and reservoirs (n = 3), despite the fact that ancient lakes harbored much higher species richness, including many endemic species. One potential factor leading to shorter FCL in ancient lakes is an increasing diversity of trophic omnivores and herbivores. Speciation could simply broaden the number of species within a trophic group, particularly at lower trophic levels and could also lead to a greater degree of trophic omnivory. Our results highlight a counter-intuitive and poorly-understood role of evolutionary history in shaping key food web properties such as FCL

Conceptual Frameworks and Methods for Advancing Invasion Ecology

Invasion ecology has much advanced since its early beginnings. Nevertheless, explanation, prediction, and management of biological invasions remain difficult. We argue that progress in invasion research can be accelerated by, first, pointing out difficulties this field is currently facing and, second, looking for measures to overcome them. We see basic and applied research in invasion ecology confronted with difficulties arising from (A) societal issues, e.g., disparate perceptions of invasive species; (B) the peculiarity of the invasion process, e.g., its complexity and context dependency; and (C) the scientific methodology, e.g., imprecise hypotheses. To overcome these difficulties, we propose three key measures: (1) a checklist for definitions to encourage explicit definitions; (2) implementation of a hierarchy of hypotheses (HoH), where general hypotheses branch into specific and precisely testable hypotheses; and (3) platforms for improved communication. These measures may significantly increase conceptual clarity and enhance communication, thus advancing invasion ecology

Oral-Derived Bacterial Flora Defends Its Domain by Recognizing and Killing Intruders—A Molecular Analysis Using Escherichia coli as a Model Intestinal Bacterium

Within the same human gastrointestinal tract, substantial differences in the bacterial species that inhabit oral cavity and intestinal tract have been noted. Previous research primarily attributed the differences to the influences of host environments and nutritional availabilities (“host habitat” effect). Our recent study indicated that, other than the host habitat effect, an existing microbial community could impose a selective pressure on incoming foreign bacterial species independent of host-mediated selection (“community selection” effect). In this study, we employed in vitro microbial floras representing microorganisms that inhabit the oral cavities and intestinal tract of mice in combination with Escherichia coli as a model intestinal bacterium and demonstrated that E. coli displays a striking community preference. It thrived when introduced into the intestinal microbial community and survived poorly in the microbial flora of foreign origin (oral community). A more detailed examination of this phenomenon showed that the oral community produced oxygen-free radicals in the presence of wild-type E. coli while mutants deficient in lipopolysaccharides (LPS) did not trigger significant production of these cell-damaging agents. Furthermore, mutants of E. coli defective in the oxidative stress response experienced a more drastic reduction in viability when cocultivated with the oral flora, while the exogenous addition of the antioxidant vitamin C was able to rescue it. We concluded that the oral-derived microbial community senses the E. coli LPS and kills the bacterium with oxygen-free radicals. This study reveals a new mechanism of community invasion resistance employed by established microflora to defend their domains

Do Native Parasitic Plants Cause More Damage to Exotic Invasive Hosts Than Native Non-Invasive Hosts? An Implication for Biocontrol

Field studies have shown that native, parasitic plants grow vigorously on invasive plants and can cause more damage to invasive plants than native plants. However, no empirical test has been conducted and the mechanism is still unknown. We conducted a completely randomized greenhouse experiment using 3 congeneric pairs of exotic, invasive and native, non-invasive herbaceous plant species to quantify the damage caused by parasitic plants to hosts and its correlation with the hosts' growth rate and resource use efficiency. The biomass of the parasitic plants on exotic, invasive hosts was significantly higher than on congeneric native, non-invasive hosts. Parasites caused more damage to exotic, invasive hosts than to congeneric, native, non-invasive hosts. The damage caused by parasites to hosts was significantly positively correlated with the biomass of parasitic plants. The damage of parasites to hosts was significantly positively correlated with the relative growth rate and the resource use efficiency of its host plants. It may be the mechanism by which parasitic plants grow more vigorously on invasive hosts and cause more damage to exotic, invasive hosts than to native, non-invasive hosts. These results suggest a potential biological control effect of native, parasitic plants on invasive species by reducing the dominance of invasive species in the invaded community

Island Invasion by a Threatened Tree Species: Evidence for Natural Enemy Release of Mahogany (Swietenia macrophylla) on Dominica, Lesser Antilles

Despite its appeal to explain plant invasions, the enemy release hypothesis (ERH) remains largely unexplored for tropical forest trees. Even scarcer are ERH studies conducted on the same host species at both the community and biogeographical scale, irrespective of the system or plant life form. In Cabrits National Park, Dominica, we observed patterns consistent with enemy release of two introduced, congeneric mahogany species, Swietenia macrophylla and S. mahagoni, planted almost 50 years ago. Swietenia populations at Cabrits have reproduced, with S. macrophylla juveniles established in and out of plantation areas at densities much higher than observed in its native range. Swietenia macrophylla juveniles also experienced significantly lower leaf-level herbivory (∼3.0%) than nine co-occurring species native to Dominica (8.4–21.8%), and far lower than conspecific herbivory observed in its native range (11%–43%, on average). These complimentary findings at multiple scales support ERH, and confirm that Swietenia has naturalized at Cabrits. However, Swietenia abundance was positively correlated with native plant diversity at the seedling stage, and only marginally negatively correlated with native plant abundance for stems ≥1-cm dbh. Taken together, these descriptive patterns point to relaxed enemy pressure from specialized enemies, specifically the defoliator Steniscadia poliophaea and the shoot-borer Hypsipyla grandella, as a leading explanation for the enhanced recruitment of Swietenia trees documented at Cabrits

On the origin of the invasive olives (Olea europaea L., Oleaceae).

The olive tree (Olea europaea) has successfully invaded several regions in Australia and Pacific islands. Two olive subspecies (subspp. europaea and cuspidata) were first introduced in these areas during the nineteenth century. In the present study, we determine the origin of invasive olives and investigate the importance of historical effects on the genetic diversity of populations. Four invasive populations from Australia and Hawaii were characterized using eight nuclear DNA microsatellites, plastid DNA markers as well as ITS-1 sequences. Based on these data, their genetic similarity with native populations was investigated, and it was determined that East Australian and Hawaiian populations (subsp. cuspidata) have originated from southern Africa while South Australian populations (subsp. europaea) have mostly derived from western or central Mediterranean cultivars. Invasive populations of subsp. cuspidata showed significant loss of genetic diversity in comparison to a putative source population, and a recent bottleneck was evidenced in Hawaii. Conversely, invasive populations of subsp. europaea did not display significant loss of genetic diversity in comparison to a native Mediterranean population. Different histories of invasion were inferred for these two taxa with multiple cultivars introduced restoring gene diversity for europaea and a single successful founder event and sequential introductions to East Australia and then Hawaii for cuspidata. Furthermore, one hybrid (cuspidata x europaea) was identified in East Australia. The importance of hybridizations in the future evolution of the olive invasiveness remains to be investigated

Inconsistent impacts of decomposer diversity on the stability of aboveground and belowground ecosystem functions

The intensive discussion on the importance of biodiversity for the stability of essential processes in ecosystems has prompted a multitude of studies since the middle of the last century. Nevertheless, research has been extremely biased by focusing on the producer level, while studies on the impacts of decomposer diversity on the stability of ecosystem functions are lacking. Here, we investigate the impacts of decomposer diversity on the stability (reliability) of three important aboveground and belowground ecosystem functions: primary productivity (shoot and root biomass), litter decomposition, and herbivore infestation. For this, we analyzed the results of three laboratory experiments manipulating decomposer diversity (1–3 species) in comparison to decomposer-free treatments in terms of variability of the measured variables. Decomposer diversity often significantly but inconsistently affected the stability of all aboveground and belowground ecosystem functions investigated in the present study. While primary productivity was mainly destabilized, litter decomposition and aphid infestation were essentially stabilized by increasing decomposer diversity. However, impacts of decomposer diversity varied between plant community and fertility treatments. There was no general effect of the presence of decomposers on stability and no trend toward weaker effects in fertilized communities and legume communities. This indicates that impacts of decomposers are based on more than effects on nutrient availability. Although inconsistent impacts complicate the estimation of consequences of belowground diversity loss, underpinning mechanisms of the observed patterns are discussed. Impacts of decomposer diversity on the stability of essential ecosystem functions differed between plant communities of varying composition and fertility, implicating that human-induced changes of biodiversity and land-use management might have unpredictable effects on the processes mankind relies on. This study therefore points to the necessity of also considering soil feedback mechanisms in order to gain a comprehensive and holistic understanding of the impacts of current global change phenomena on the stability of essential ecosystem functions

Polychaete invader enhances resource utilization in a species-poor system

Ecosystem consequences of biodiversity change are often studied from a species loss perspective, while the effects of invasive species on ecosystem functions are rarely quantified. In this experimental study, we used isotope tracers to measure the incorporation and burial of carbon and nitrogen from a simulated spring phytoplankton bloom by communities of one to four species of deposit-feeding macrofauna found in the species-poor Baltic Sea. The recently invading polychaete Marenzelleriaarctia, which has spread throughout the Baltic Sea, grows more rapidly than the native species Monoporeia affinis, Pontoporeia femorata (both amphipods) and Macoma balthica (a bivalve), resulting in higher biomass increase (biomass production) in treatments including the polychaete. Marenzelleria incorporated and buried bloom material at rates similar to the native species. Multi-species treatments generally had higher isotope incorporation, indicative of utilization of bloom material, than expected from monoculture yields of the respective species. The mechanism behind this observed over-yielding was mainly niche complementarity in utilization of the bloom input, and was more evident in communities including the invader. In contrast, multi-species treatments had generally lower biomass increase than expected. This contrasting pattern suggests that there is little overlap in resource use of freshly deposited bloom material between Marenzelleria and the native species but it is likely that interference competition acts to dampen resulting community biomass. In conclusion, an invasive species can enhance incorporation and burial of organic matter from settled phytoplankton blooms, two processes fundamental for marine productivity