A New Proposal for Collection and Generation of Information on Financial Institutions' Risk: the case of derivatives

This article aims at providing a new alternative for the collection of information on risks taken by financial institutions, which enables the calculation of risk tools usually used in risk management, such as VaR and stress tests. This approach should help risk managers, off-site supervision and academics in assessing the potential risks in financial institutions principally due to derivatives positions. The basic idea, for linear financial instruments, like the traditionally used by the management risk systems, is to reduce positions in risk factors and then mapping by vertices. For the nonlinear financial instruments all of the positions in different types of options – European, Americans, exotic, etc.– are represented as plain vanilla European options or replicated by portfolios of plain vanilla European options. The methodology was applied to Brazil, within the worst scenarios during the period from 1994 to 2004, and the paper demonstrates that the proposed approach captured the risks satisfactorily in the analyzed portfolios, including the risk existent in the strategies involving options, given an accepted error margin. This approach could be useful for regulators, risk managers; financial institutions and risk management modeling as it can be used as an input in general risk management models.

Fast growing instabilities for non-parallel flows

Unstable modes growing when two plasma shells cross over a background plasma at arbitrary angle $\theta$, are investigated using a non-relativistic three cold fluids model. Parallel flows with $\theta=0$ are slightly more unstable than anti-parallel ones with $\theta=\pi$. The case $\theta=\pi/2$ is as unstable as the $\theta=0$ one, but the fastest growing modes are oblique. While the most unstable wave vector varies with orientation, its growth rate slightly evolves and there is no such thing as a stable configuration. A number of exact results can be derived, especially for the $\theta=\pi/2$ case.Comment: 4 pages, 3 figures, to appear in Phys. Lett.

Forecasting Interest Rates: an application for Brazil

Understanding the links between long and short-term interest rates is crucial for monetary policy makers, since Central Banks decide and set short-term interest rates in order to affect indirectly long-term interest rates, which affects aggregate spending. This paper studies whether VAR/VEC models are useful in predicting long-term interest rates for Brazil. The empirical results suggest that these models are useful in building qualitative scenarios for the Term structure of interest rates, but do not provide good forecasts in terms of accuracy. Furthermore, models that assume that the future path of short-term interest rates (target interest rates) is known by forecasters do not perform better in terms of both directional and forecasting accuracy.

Comparison of research framing preferences and information use of state legislators and advocates involved in cancer control, United States, 2012–2013

INTRODUCTION: Evidence-based policy plays an important role in prevention of cancer and other chronic diseases. The needs of actors involved in policy decision-making should inform knowledge translation strategies. This study examines the differences between state legislators and advocates in how they seek and use information and what their preferences are for how research information is framed. METHODS: We conducted a cross-sectional comparison of survey responses by US advocates (n = 77) and state legislators (n = 265) working on issues related to cancer control. RESULTS: Advocates differed significantly from legislators on all demographic characteristics. Advocates reported seeking and using information more frequently than legislators, though legislators used legislative research bureaus more often (0.45 point difference, P = .004). Both legislators and advocates prioritized the presentation and timeliness of research information similarly but reported different preferences for source (information bias, information relevance, delivery of information by trusted person) of research information. Several differences between advocates and legislators were modified by participant age. CONCLUSION: Our study provides insights for development of knowledge translation strategies to enhance evidence-based policy making for cancer control that are tailored to state-level legislators and advocates. Additional research efforts should evaluate the effectiveness of such knowledge translation strategies, particularly among advocates

Opportunities for promoting physical activity in rural communities by understanding the interests and values of community members

Purpose. Physical activity (PA) has well-established health benefits, but most Americans do not meet national guidelines. In southeastern Missouri, trails have been developed to increase rates of PA. Although this has had success, broad-scale interventions will be needed to improve rates further. In this study, we surveyed residents of southeastern Missouri to identify ways to improve rates of PA. Methods. We conducted a telephone survey in 2015 of adults (n=524) from eight rural Missouri towns that had walking trails, regarding their activities and interests. Findings. Forty percent of respondents reported both walking and meeting PA recommendations, 29% reported walking but not meeting PA recommendations, and the remainder did not walk or did not answer. Respondents who used the trails were significantly more likely to meet PA recommendations (odds ratio = 2.7; 95% confidence interval = 1.7, 4.5). Certain values and interests that may encourage PA or draw people to trails were common. Conclusions. The group that walked but did not meet PA recommendations would be the ideal group to target for intervention, which could focus on their reported values and interests (e.g., personal relationships, being outdoors). Use of walking trails was associated with meeting PA recommendations

The Roles of Featural and Configural Face Processing in Snap Judgments of Sexual Orientation

Research has shown that people are able to judge sexual orientation from faces with above-chance accuracy, but little is known about how these judgments are formed. Here, we investigated the importance of well-established face processing mechanisms in such judgments: featural processing (e.g., an eye) and configural processing (e.g., spatial distance between eyes). Participants judged sexual orientation from faces presented for 50 milliseconds either upright, which recruits both configural and featural processing, or upside-down, when configural processing is strongly impaired and featural processing remains relatively intact. Although participants judged women’s and men’s sexual orientation with above-chance accuracy for upright faces and for upside-down faces, accuracy for upside-down faces was significantly reduced. The reduced judgment accuracy for upside-down faces indicates that configural face processing significantly contributes to accurate snap judgments of sexual orientation

How Informative Are Interest Rate Survey-based Forecasts?

This paper studies the information content of survey-based predictions for the Brazilian short-term interest rate. We perform vector autoregression analysis to test for the dynamic relationship between market expectations of interest rates and spot interest rates, and a single regression forecasting approach. Empirical results suggest that surveys may be useful in assessing market expectations (contain relevant information) and in building Central Bank credibility. Within an inflation targeting framework they are crucial in order to receive timely feedback on market sentiment regarding the conduct of monetary policy