Valuing Financial Flexibility

Two facts that corporations, underwriters and investors have been forced to confront are increased capital market volatility and increased complexity in the design of securities. However, these two facts, increased volatility and increased complexity, are not unrelated. Virtually all of the complexity in securities can be viewed as the inclusion of different options in a straight debt contract. Given the fact that the value of options is driven most significantly by volatility, the advantage of including options, i.e. financial flexibility, in securities has increased with increased market volatility. This would appear to explain why corporate issuers and institutional investors have shown substantial interest in securities which improve their flexibility in volatile markets. Therefore, techniques which can consistently reflect the role of volatility in the value of options or flexibility, should be of interest to issuers, underwriters, and investors.This paper summarizes the results of some research by Jones, Masonand Rosenfeld (MR), (1984), and presents some new results, which test the ability of a CCA model based on Black and Scholes' option pricingprinciples to predict the market price of callable corporate debt, andtherefore, the price of such common debt covenants as call provisions andcall protection, In addition, some numerical CCA results are reportedwhich demonstrate the impact of changing interest rate volatility on the value of call provisions and call protection.

A generalization of the Lyndon--Hochschild--Serre spectral sequence with applications to group cohomology and decompositions of groups

We set up a Grothendieck spectral sequence which generalizes the Lyndon--Hochschild--Serre spectral sequence for a group extension K\mono G\epi Q by allowing the normal subgroup $K$ to be replaced by a subgroup, or family of subgroups which satisfy a weaker condition than normality. This is applied to establish a decomposition theorem for certain groups as fundamental groups of graphs of Poincar\'e duality groups. We further illustrate the method by proving a cohomological vanishing theorem which applies for example to Thompson's group $F$.Comment: 22 page

A stationary visual census technique for quantitatively assessing community structure of coral reef fishes

A new method is described and evaluated for visually sampling reef fish community structure in environments with highly diverse and abundant reef fish populations. The method is based on censuses of reef fishes taken within a cylinder of 7.5 m radius by a diver at randomly selected, stationary points. The method provides quantitative data on frequency of occnrrence, fish length, abundance, and community composition, and is simple, fast, objective, and repeatable. Species are accumulated rapidly for listing purposes, and large numbers of samples are easily obtained for statistical treatment. The method provides an alternative to traditional visual sampling methods. Observations showed that there were no significant differences in total numbers of species or individuals censused when visibility ranged between 8 and 30 m. The reefs and habitats sampled were significant sources of variation in number of species and individuals censused, but the diver was not a significant influence. Community similarity indices were influenced significantly by the specific sampling site and the reef sampled, but were not significantly affected by the habitat or diver (PDF file contains 21 pages.

Should archaeologists care about 14C inter-comparisons? Why? A summary report on SIRI

Radiocarbon (14C) dating is used widely in many projects as a basis for the creation and testing of chronological constructs. 14C measurements are by their nature complex and the degree of sample pretreatment varies considerably depending on the material. Within the United Kingdom and Europe, there are a number of well-established laboratories and increasingly, archaeologists are not just commissioning new dates, but also using statistical modelling of assemblages of dates, perhaps measured in different laboratories, to provide formal date estimates for their sites. The issue of comparability of measurements (and thus bias, accuracy and precision of measurement) from the diverse laboratories is one which has been the focus of some attention both within the 14C community and the wider user communities for some time. As a result of this but also as part of laboratory benchmarking and quality assurance, the 14C community has undertaken a wide-scale, far-reaching, and evolving program of intercomparisons, to the benefit of laboratories and users alike. This paper summarizes the most recent exercise, the Sixth International Radiocarbon Intercomparison (SIRI)

Correlation of the orbach relaxation coefficient with optical linewidths- laf3-er3 plus

Correlation of Orbach coefficient of spin-lattice relaxation with optical transition linewidths for trivalent erbium in lanthanum fluorid