Pseudo Market Timing and Predictive Regressions

A number of studies claim that aggregate managerial decision variables, such as aggregate equity issuance, have power to predict stock or bond market returns. Recent research argues that these results may be driven by an aggregate time-series version of Schultz's (2003) pseudo market timing bias. We use standard simulation techniques to estimate the size of the aggregate pseudo market timing bias for a variety of predictive regressions based on managerial decision variables. We find that the bias can explain only about one percent of the predictive power of the equity share in new issues, and that it is also much too small to overturn prior inferences about the predictive power of corporate investment plans, insider trading, dividend initiations, or the maturity of corporate debt issues.

The Low Beta Anomaly: A Decomposition into Micro and Macro Effects

Low beta stocks have offered a combination of low risk and high returns. We decompose the anomaly into micro and macro components. The micro component comes from the selection of low beta stocks. The macro component comes from the selection of low beta countries or industries. The two parts both contribute to the low beta anomaly, with important implications for the construction of managed volatility portfolios

Under New Management: Equity Issues and the Attribution of Past Returns

There is a strong link between measures of stock market performance, such as changes in Tobin's Q or past stock returns, and equity issues. Typically, this performance is thought to be a characteristic of the firm, not the CEO who happens to run the firm. In contrast to this conventional wisdom, we find that equity issues depend on changes in Q and returns to a greater extent if the current CEO was at the helm when those past returns were realized. What we label the CEO-specific Q and past return explains equity issuance, but it does not explain debt issuance, investment, or profitability. Two discontinuity analyses show that the specific share price that the current CEO inherited is an important reference point, while salient share prices prior to turnover are not. A corollary is that a firm with poor stock market performance cannot, or will not, raise new capital unless the current CEO is replaced

The Effect of Reference Point Prices on Mergers and Acquisitions

Prior stock price peaks of targets affect several aspects of merger and acquisition activity. Offer prices are biased toward recent peak prices although they are economically unremarkable. An offer's probability of acceptance jumps discontinuously when it exceeds a peak price. Conversely, bidder shareholders react more negatively as the offer price is influenced upward toward a peak. Merger waves occur when high returns on the market and likely targets make it easier for bidders to offer a peak price. Parties thus appear to use recent peaks as reference points or anchors to simplify the complex tasks of valuation and negotiation

Dividends as Reference Points: A Behavioral Signaling Approach

We outline a dividend signaling model that features investors who are averse to dividend cuts. Managers with strong unobservable cash earnings separate by paying high dividends but retain enough to be likely not to fall short next period. The model is consistent with a Lintner partial-adjustment model; modal dividend changes of zero; stronger market reactions to dividend cuts than increases; comparatively infrequent and irregular repurchases; and a mechanism that does not depend on public destruction of value, which managers reject in surveys. New tests involve stronger reactions to changes from longer-maintained dividend levels and reference point currencies of ADR dividends

Tunable-filter imaging of quasar fields at z~1. I. A cluster around MRC B0450-221

Using a combination of multicolour broad- and narrow-band imaging techniques and follow-up spectroscopy, we have detected an overdensity of galaxies in the field of quasar MRC B0450-221, whose properties are consistent with a cluster at the quasar redshift z=0.9. An excess of red galaxies (V-I>2.2, I-K'>3.8) is evident within 1' of the quasar, with the colours expected for galaxies at z=0.9 that have evolved passively for 3 Gyr or more. A number of line-emitting galaxies (nine candidates with equivalent widths EW>70A) are also detected in the field using the TAURUS Tunable Filter (TTF). Three have been confirmed spectroscopically to indeed lie at z=0.9. The TTF candidates with the strongest [O II] line emission cluster in a group which lies 200-700 kpc away from the quasar and the red galaxy excess, and therefore most likely on the outskirts of the cluster. These observations are the first in a series probing quasar environments at z~1 with TTF.Comment: Accepted for publication in AJ. 25 pages, 24 figs (large files in jpg or gif format), uses emulateapj.st

Cisplatin-resistant triple-negative breast cancer subtypes: multiple mechanisms of resistance.

BACKGROUND: Understanding mechanisms underlying specific chemotherapeutic responses in subtypes of cancer may improve identification of treatment strategies most likely to benefit particular patients. For example, triple-negative breast cancer (TNBC) patients have variable response to the chemotherapeutic agent cisplatin. Understanding the basis of treatment response in cancer subtypes will lead to more informed decisions about selection of treatment strategies. METHODS: In this study we used an integrative functional genomics approach to investigate the molecular mechanisms underlying known cisplatin-response differences among subtypes of TNBC. To identify changes in gene expression that could explain mechanisms of resistance, we examined 102 evolutionarily conserved cisplatin-associated genes, evaluating their differential expression in the cisplatin-sensitive, basal-like 1 (BL1) and basal-like 2 (BL2) subtypes, and the two cisplatin-resistant, luminal androgen receptor (LAR) and mesenchymal (M) subtypes of TNBC. RESULTS: We found 20 genes that were differentially expressed in at least one subtype. Fifteen of the 20 genes are associated with cell death and are distributed among all TNBC subtypes. The less cisplatin-responsive LAR and M TNBC subtypes show different regulation of 13 genes compared to the more sensitive BL1 and BL2 subtypes. These 13 genes identify a variety of cisplatin-resistance mechanisms including increased transport and detoxification of cisplatin, and mis-regulation of the epithelial to mesenchymal transition. CONCLUSIONS: We identified gene signatures in resistant TNBC subtypes indicative of mechanisms of cisplatin. Our results indicate that response to cisplatin in TNBC has a complex foundation based on impact of treatment on distinct cellular pathways. We find that examination of expression data in the context of heterogeneous data such as drug-gene interactions leads to a better understanding of mechanisms at work in cancer therapy response

Elevated Paracellular Glucose Flux across Cystic Fibrosis Airway Epithelial Monolayers Is an Important Factor for Pseudomonas aeruginosa Growth.

People with cystic fibrosis (CF) who develop related diabetes (CFRD) have accelerated pulmonary decline, increased infection with antibiotic-resistant Pseudomonas aeruginosa and increased pulmonary exacerbations. We have previously shown that glucose concentrations are elevated in airway surface liquid (ASL) of people with CF, particularly in those with CFRD. We therefore explored the hypotheses that glucose homeostasis is altered in CF airway epithelia and that elevation of glucose flux into ASL drives increased bacterial growth, with an effect over and above other cystic fibrosis transmembrane conductance regulator (CFTR)-related ASL abnormalities. The aim of this study was to compare the mechanisms governing airway glucose homeostasis in CF and non-CF primary human bronchial epithelial (HBE) monolayers, under normal conditions and in the presence of Ps. aeruginosa filtrate. HBE-bacterial co-cultures were performed in the presence of 5 mM or 15 mM basolateral glucose to investigate how changes in blood glucose, such as those seen in CFRD, affects luminal Ps. aeruginosa growth. Calu-3 cell monolayers were used to evaluate the potential importance of glucose on Ps. aeruginosa growth, in comparison to other hallmarks of the CF ASL, namely mucus hyperviscosity and impaired CFTR-dependent fluid secretions. We show that elevation of basolateral glucose promotes the apical growth of Ps. aeruginosa on CF airway epithelial monolayers more than non-CF monolayers. Ps. aeruginosa secretions elicited more glucose flux across CF airway epithelial monolayers compared to non-CF monolayers which we propose increases glucose availability in ASL for bacterial growth. In addition, elevating basolateral glucose increased Ps. aeruginosa growth over and above any CFTR-dependent effects and the presence or absence of mucus in Calu-3 airway epithelia-bacteria co-cultures. Together these studies highlight the importance of glucose as an additional factor in promoting Ps. aeruginosa growth and respiratory infection in CF disease

Hierarchical Hough all-sky search for periodic gravitational waves in LIGO S5 data

We describe a new pipeline used to analyze the data from the fifth science run (S5) of the LIGO detectors to search for continuous gravitational waves from isolated spinning neutron stars. The method employed is based on the Hough transform, which is a semi-coherent, computationally efficient, and robust pattern recognition technique. The Hough transform is used to find signals in the time-frequency plane of the data whose frequency evolution fits the pattern produced by the Doppler shift imposed on the signal by the Earth's motion and the pulsar's spin-down during the observation period. The main differences with respect to previous Hough all-sky searches are described. These differences include the use of a two-step hierarchical Hough search, analysis of coincidences among the candidates produced in the first and second year of S5, and veto strategies based on a $\chi^2$ test.Comment: 7 pages, 2 figures, Amaldi08 proceedings, submitted to JPC