On the formation of the European Monetary Union

The main objective of this study is to search, using both theoretical analysis and empirical evidence for the European case, for the strategy to be followed for the creation of a monetary union among a group of countries, and to derive the conditions which have to be fulfilled in order to make such a strategy viable. The theoretical foundations for the creation of a monetary union are set out. The European realities suggest gradualistic approaches. Theoretical analysis of the strategy of economic policy coordination takes place in terms of all of the above considerations. Analysis then follows on the extent to which this strategy, implemented in Europe since the early seventies, has been successful. Finally, in the light of this analysis and analysis of other proposals, a conclusion is reached on which should be the preferred strategy, and how it should be established successfully. The move towards exchange rate fixity has implications for members' objectives and policies. The European arrangements were inadequate and did not pay sufficient attention to important issues which remained unsolved. Economic discipline was not forced and members' objectives diverged considerably. Policies did not depict any coordination pattern. As a result the 1972 intra-European exchange rate arrangements failed. Other undesirable implications also followed. Policy coordination still seems to be the preferable approach provided that important changes take place, and measures to eventually develop centralisation are taken. The decision to create a European monetary system is judged in view of these conclusions. Major weaknesses remain and the system's ability to guarantee long-run stability is questioned. Important changes are necessary for the Community to embark on the path to a monetary union. Indications are not encouraging, while important obstacles to the changes remain

An investigation of price - volume intraday patterns under "Bull" and "Bear" market conditions

There has been a common belief among stock market practitioners that stock prices move along with trading volume creating certain patterns in price and volume formation. Nevertheless, the above argument was hardly recognised by the academic community since for a number of years statistical results indicated that the stock market is an efficient market i.e. a market where past available information is of no use in predicting future returns profitably, and/or non rational factors do not influence stock prices; The last decade the research for market efficiency was expanded and the use of new large data sets and advanced techniques indicated deviations from the predictions of the Efficient Market Hypothesis (E.M.H.). This study investigates whether there exists a relationship between stock returns and trading volume in the Athens Stock Exchange (A.S.E.) and if such a relationship forms evidence against the E.M.H. We believe that we add to the research in this area since we use intraday data and investigate for a possible relationship under different market states and for different categories of shares.peer-reviewe

Bank acquisitions and shareholder returns

This paper examines whether acquisitions in the banking sector are associated with positive shareholder returns in the long run. It analyses 17 acquisitions of Greek and foreign banking institutions by six major Greek banks during the 1998-2006 period. The model used is adjusted for market index movements, while autoregressive models are used whenever necessary. The empirical results are interesting since they support the hypothesis that acquisitions are justified in market terms whenever the size of the acquired banks, compared to the acquirer, is small, whereas they are not justified in cases where the acquired bank is relatively large in size. This may be due to the fact that the benefits from an acquisition are not visible or large enough to justify the large, in absolute terms, premium that the acquirer pays.bank acquisitions; capital markets; market efficiency; market returns; valuation; shareholder returns; Greece; financial services management.

'Altman Ζ-score model' and prediction of business failures

This paper analyses whether Z-score, as examined by Altman and other researchers, can predict correctly company failures. The empirical analysis concentrates on the construction companies listed in Athens Exchange, for the period 1995-2006, which coincides with significant construction activity in Greece. It is investigated whether Z-score models can predict bankruptcies for a period up to eight years earlier. It is derived that a particular Altman model performs well in predicting failures for a period up to five years earlier. This is in line with other findings. The empirical results are interesting as they can be used by portfolio managers in stock selection and by company management for merger decisions or other corporate strategic moves.risk assessment; bankruptcy prediction; valuation; Altman Z-analysis; mergers; acquisitions; portfolio selection; corporate strategy; company failures; failure prediction; Greece; Z-score models; stock selection.

Short selling and equity returns with full information dissemination

This paper sheds further light on whether short selling can be associated with negative returns in the spot market. It provides evidence for the case of the capital market of the Athens Exchange (ATHEX) that is empirically tested for the first time, during the period 2003–2007. This market possesses certain interesting characteristics, as along with constrained sales it entailed the rare feature of wide short sales transparency. The empirical findings indicate that short selling is associated with subsequent negative abnormal stock returns for the heavily sold short stocks of this market.short selling; spot markets; excess returns; abnormal returns; equity returns; information dissemination; negative returns; capital markets; Athens Exchange; ATHEX; Greece; constrained sales; short sales; transparency; short stocks; stock exchanges; monetary economics; finance.

An investigation of Price – Volume intraday patterns under “Bull” and “Bear” market conditions.

There has been a common belief among stock market practitioners that stock prices move along with trading volume creating certain patterns in price and volume formation. Nevertheless, the above argument was hardly recognised by the academic community since for a number of years statistical results indicated that the stock market is an efficient market i.e. a market where past available information is of no use in predicting future returns profitably, and/or non rational factors do not influence stock prices; The last decade the research for market efficiency was expanded and the use of new large data sets and advanced techniques indicated deviations from the predictions of the Efficient Market Hypothesis (E.M.H.). This study investigates whether there exists a relationship between stock returns and trading volume in the Athens Stock Exchange (A.S.E.) and if such a relationship forms evidence against the E.M.H. We believe that we add to the research in this area since we use intraday data and investigate for a possible relationship under different market states and for different categories of shares.informational efficiency, stock prices, trading volume, causality