Meteor Shower and Global Asset Allocation

We show that basic materials, financials, industrial, technologies, and telecommunication equity sectors were the primary exporters of volatility from the U.S. and that the magnitude of the spillover increased especially during and post-2008 financial crisis. Investing in low volatility spillover countries generate high Sharpe ratios for U.S. portfolio managers, especially during the financial crisis

Meteor shower and global asset allocation

Cross-market linkages allow transmission of shocks among markets. Previous measures of such spillovers are based on broader stock market indexes, which cannot identify the industries that are the principal drivers of spillovers and the industries that are most exposed to the spillovers. Using investable equity indexes, we show that basic materials, financials, industrials, technologies, and telecommunication equity sectors were the primary exporters of volatility from the U.S. and that the magnitude of the spillovers increased primarily during andpost-2008 financial crisis. There is evidence that Canada was most vulnerable to spillovers, while China’s exposure was the lowest among the countries in the sample. Based on the minimum variance portfolio optimization, we find that investing in foreign industries with low exposure to spillovers from the U.S. generates high Sharpe ratios for U.S. portfolio managers, especially during the financial crisis

The choice of an invoicing currency in international trade and the balance of trade impact of currency depreciation

Cross-country differences in the choice of an invoicing currency in international trade is one reason for cross-country differences in estimated exchange rate coefficients in short-run balance of trade equations. If exports are invoiced in domestic currency while imports are invoiced in a foreign currency, a depreciation will increase the domestic currency value of outstanding import contracts, and may cause the balance of trade to fall in the short run. Countries with different invoicing patterns will have different effects on the short-run trade balance following a depreciation. We explore a simple theory of invoicing currency choice, drawing inferences regarding the likely choices for 14 countries. This allows a classification of countries according to the expected short-run balance of trade effect of a currency depreciation. Empirical estimates support the hypothesized groupings based on suggested currency invoicing patterns. Copyright Kluwer Academic Publishers 1990exchange rates, international trade, invoicing practices,

Consumer confidence announcements: do they matter?

This paper examines the response of financial markets to consumer confidence announcements during 1980-93. Several hypotheses are tested to examine the impact of consumer confidence announcements on the conditional mean and the conditional volatility of stock, bond and foreign exchange prices. Despite a plethora of causal empiricism in the popular press, consumer confidence appears to influence only the Dow Jones Industrial Average, and not bond or other stock indexes. However, changes in the consumer confidence index are found to have asymmetric effects on the dollar exchange rates of five major currencies. Finally, we find that the impact of the consumer confidence index on the conditional volatility is not uniform across five major currencies.

Drug-nutrient interactions in the elderly

Dietary supplement use has steadily increased among the elderly to improve or maintain overall health and for specific reasons, such as to promote bone or heart health. The use of medicinal products is also high among the elderly, thus increasing the risk for drug–nutrient interactions (DNI). Although, DNI are well recognized, their importance is slowly getting recognition as a potential factor that may affect outcomes in the elderly with multiple comorbidities requiring multiple medications, in the background of declining functional reserves, altered nutritional status, and aging-associated physiological changes that alter the disposition (absorption, distribution, metabolism, or elimination) of the drug or nutrient and its effect on the body. Nearly half of patients using dietary supplements with prescription drugs are at risk of some interaction, with a third considered clinically significant, particularly with drugs with a narrow therapeutic index. These interactions may go undetected as the majority of patients do not disclose their supplement use to healthcare professionals. Increasing recognition of such interaction may help reduce these adverse effects. In this chapter, we will summarize different types of DNI, highlight aging-associated alterations in pharmacokinetics and pharmacodynamics that increase predisposition to DNI, and discuss issues in regulating dietary supplements that can potentially improve their safety