The economic impact of credit default swap on credit markets

This study conducts a comprehensive analysis of the economic benefits and costs of credit default swap (CDS) in credit markets since its inception. Consistent with its role of insuring credit risk, the introduction of CDS reduces illiquidity and liquidity risk more for speculative grade bonds with high credit risk than investment grade ones. More importantly, CDS significantly improves the price convergence between investment grade bonds and CDS spreads through a popular trading strategy—CDS-bond basis arbitrage in normal period. In the recent crisis, however, CDS fails to reduce the prolonged price divergence between the two markets plausibly due to the lack of arbitrage. Overall, the economic impact of CDS is dependent on the prevailing trading strategies in the credit markets

Conducting Polymer Aerogels

Conducting polymers are an important class of organic materials with electric conductivity and have experienced a rapid development. Meanwhile, as a novel class of porous nanomaterials, aerogels attract people’s great interest for their ultra-low densities, large specific areas, rich open pores, etc. Thus, conducting polymer aerogels, combining the unique merits of aerogels with physicochemical properties relevant to conducting polymers, become a newly developed area. In this chapter, we give a brief introduction describing (1) synthesis strategies of conducting polymer (PEDOT, PPy, and PANi) aerogels through rational design for oxidant, cross-linker, soft template, sol-gel process, drying process; (2) advantages of these aerogels in physical and chemical performance, compared with the counterparts in bulk or membrane; and (3) their applications in energy storage, adsorption to metal-ions/dye-molecules, stress sensing, Joule heating. The chapter ends with a reflection on limitations of already proposed materials and a prospection of how conducting polymer aerogels developing in the future. As such, this chapter can act as a roadmap to guide researchers toward how conducting polymer aerogels produced and how these materials can be utilized, while also highlighting the current advancements in the field

CDS-bond basis and bond return predictability

We examine the predictive power of the CDS-bond basis for future corporate bond returns. We find that residual basis, the part of the CDS-bond basis that cannot be explained by a wide range of market frictions such as counterparty risk, funding risk, and liquidity risk, strongly negatively predicts excess returns. Controlling for systematic risk factors, including credit risk and liquidity risk, we find that a bond portfolio formed on the residual basis generates a significant abnormal bond return of 1.79% at the 20-day horizon. The abnormal returns due to the residual basis reflect mispricing rather than missing systematic risk factors. These results are robust to different horizons and sample periods and to the various characteristics of bonds. Overall, our results imply a beneficial role of CDS in the bond market as the existence of mispricing between CDS and bonds results in a subsequent price convergence in bonds

The CDS-bond basis arbitrage and the cross section of corporate bond returns

We provide a comprehensive empirical analysis on the implication of CDS-Bond basis arbitrage for the pricing of corporate bonds. Basis arbitrageurs introduce new risks such as funding liquidity and counterparty risk into the corporate bond market, which was dominated by passive investors before the existence of credit default swap (CDS). We show that a basis factor, constructed as the return differential between LOW and HIGH quintile basis portfolios, is a superior empirical proxy that captures the new risks. In the cross section of investment grade bond returns, the basis factor carries an annual risk premium of about 3% in normal periods

Can Corporate Social Responsibility Fill Institutional Voids?

We conduct empirical analysis on the relation between firm value and corporate social responsibility (CSR) using 134,823 observations of 2542 firms across 44 countries from 2009 to 2014. We find that the firm value is positively related to the overall CSR score of the firm. At a more granular level, we find that good environmental score is positively related to the firm value and good social and governance scores are negatively related to the firm value. Since these firms operate in different institutional frameworks, we explore whether the institutional voids—the absence of institutions or intermediaries that are instrumental in supporting business operations in a country—may result in greater firm valuation for its CSR and vice versa. Our results show that firms’ environmental scores and social scores receive higher valuation in countries with weaker institutions. Overall, our findings suggest that CSR creates value for firms by filling institutional voids in their home country

Pharmacokinetics, tissue distribution and mass balance of radiolabeled dihydroartemisinin in male rats

<p>Abstract</p> <p>Background</p> <p>Dihydroartemisinin (DHA), a powerful anti-malarial drug, has been used as monotherapy and artemisinin-based combination therapy (ACT) for more than decades. So far, however, the tissue distribution and metabolic profile of DHA data are not available from animal and humans.</p> <p>Methods</p> <p>Pharmacokinetics, tissue distribution, mass balance, and elimination of [¹⁴C] DHA have been studieded in rats following a single intravenous administration. Protein binding was performed with rat and human plasma. Drug concentrations were obtained up to 192 hr from measurements of total radioactivity and drug concentration to determine the contribution by the parent and metabolites to the total dose of drug injected from whole blood, plasma, urine and faecal samples.</p> <p>Results</p> <p>Drug was widely distributed after 1 hr and rapidly declined at 24 hr in all tissues except spleen until 96 hrs. Only 0.81% of the total radioactivity was detected in rat brain tissue. DHA revealed a high binding capacity with both rat and human plasma proteins (76–82%). The concentration of total radioactivity in the plasma fraction was less than 25% of that in blood total. Metabolism of DHA was observed with high excretion via bile into intestines and approximately 89–95% dose of all conjugations were accounted for in blood, urine and faeces. However, the majority of elimination of [¹⁴C] DHA was through urinary excretion (52% dose). The mean terminal half-lives of plasma and blood radioactivity (75.57–122.13 h) were significantly prolonged compared with that of unchanged DHA (1.03 h).</p> <p>Conclusion</p> <p>In rat brain, the total concentration of [¹⁴C] was 2-fold higher than that in plasma, indicating the radioactivity could easily penetrate the brain-blood barrier. Total radioactivity distributed in RBC was about three- to four-fold higher than that in plasma, suggesting that the powerful anti-malarial potency of DHA in the treatment of blood stage malaria may relate to the high RBC binding. Biliary excretion and multiple concentration peaks of DHA have been demonstrated with high urinary excretion due to a most likely drug re-absorption in the intestines (enterohepatic circulation). The long lasting metabolites of DHA (> 192 hr) in the rats may be also related to the enterohepatic circulation.</p