Financial Framework for Global Investment and Implications

The objective of this paper is to describe a valuation decision model for a firm in a multi -country environment. The paper extends the works of Myers, Myers and Pogue and Lev to include individual investment project decisions to the global marketplace. The model integrates the buy or builds decision, the location of production, distribution decision and tax effects into the capital investment decision of the firm. The model shows that a firm\u27s production decision (buy or build), the customer location and tax effects are interdependent. The model to optimize the value of the firm is a function of the interdependencies of the input and financing factors. This will require significant modification of the traditional theories used for the determination of a firm\u27s capital structure and cost of capital. This implies the current methodology used to learn finance needs to be modified. The paper also briefly discusses its implications on government policy for the economy and the firm

Getting Better: Learning to Invest in an Emerging Stock Market

This paper reports evidence that individual investors in Indian equities hold better performing portfolios as they become more experienced in the equity market. Experienced investors tilt their portfolios profitably towards value stocks and stocks with low turnover, but these tilts do not fully explain their good performance. Experienced investors also tend to have lower turnover and disposition bias. These behaviors, as well as underdiversification, diminish when investors experience poor returns resulting from them, consistent with models of reinforcement learning. Indian stocks held by experienced, well diversified, low-turnover and low-disposition-bias investors deliver higher average returns even controlling for a standard set of stock-level characteristics

How Do Regulators Influence Mortgage Risk? Evidence from an Emerging Market

We employ loan-level data on over a million loans disbursed in India between 1995 and 2010 to understand how fast-changing regulation impacted mortgage lending and risk. Our methodology offers an alternative to regression discontinuity analysis that applies even when regulations create no discontinuities in the cross-section. We use cross-sectional differences in the time-series variation of delinquency rates, conditional on initial interest rates, to detect the effects of regulations favoring smaller loans. We also find that a change in the classification of non-performing assets reduced both delinquency probabilities and losses given delinquency

Getting Better or Feeling Better? How Equity Investors Respond to Investment Experience

Using a large representative sample of Indian retail equity investors, many of them new to the stock market, we show that both years of investment experience and feedback from investment returns have significant effects on investor behavior, favored stock styles, and performance. We identify two channels of feedback: performance relative to the market, and the directly experienced returns to behavior and styles of stock. Both of these vary across investors at a point in time because investors are imperfectly diversified and receive idiosyncratic returns. We find that experienced investors generally behave in a manner more consistent with the recommendations of finance theory, although this tendency is weakened by strong investment performance. High trading profits increase turnover, while high returns to equity styles have a short-term negative and a longer-term positive effect on investors' style demands, possibly reflecting the offsetting effects of disposition bias and style chasing. We document high returns on a portfolio of stocks held by experienced investors, and on individual Indian stocks with an experienced and low-turnover investor base.Economic

How Do Regulators Influence Mortgage Risk: Evidence from an Emerging Market

To understand the effects of regulation on mortgage risk, it is instructive to track the history of regulatory changes in a country rather than to rely entirely on cross- country evidence that can be contaminated by unobserved heterogeneity. However, in developed countries with fairly stable systems of financial regulation, it is difficult to track these effects. We employ loan-level data on over a million loans disbursed in India over the 1995 to 2010 period to understand how fast-changing regulation impacted mortgage lending and risk. We use cross-sectional differences in the time- series variation of delinquency rates, conditional on initial interest rates, to detect the effects of regulation on mortgage delinquencies.Economic

Evaluation of antioxidant properties in thirteen Fijian medicinal plants used in Alzheimer’s disease and related illness

Objective: The present study aims to evaluate antioxidant properties of decoction and ethanol extracts of Fijian medicinal plants using 2,2-diphenyl-1-picryl-hydrazyl (DPPH) scavenging assay. Method: Thirteen plant species belonging to Melastomataceae, Asteraceae, Apiaceae, Rutaceae, Goodeniaceae, Loganiaceae, Araliaceae, Solanaceae, Polygonaceae, Zingiberaceae and Anacardiaceae families were tested at 0.2 mg/mL, 0.4 mg/mL, 0.6 mg/mL, 0.8 mg/mL, 1.0 mg/mL, 1.5 mg/mL and 2.0 mg/mL concentrations for antioxidant properties. The antioxidant capabilities were compared with ascorbic acid standard. Results and Discussions: Among the decoction and ethanol extracts tested, all plants showed DPPH scavenging activity. The most potent antioxidant activity was seen in C. hirta with an IC50 value of 0.64 mg/mL. The activity of C. hirta was twofold more potent than the standard ascorbic acid (IC50 = 1.33 mg/mL) indicating that polar extracts of C. hirta contains compounds with relatively better antioxidant properties than ascorbic acid. Conclusion: The plant extracts used in this study were crude extracts, as it is envisaged that if the phytochemicals were isolated and purified from these plants, more prominent results could be expected. These plants could prove leads to safer and better candidates for the future selection of antioxidant. Key words: DPPH, Reactive Oxygen Species, Radical scavenging activity, Antioxidants, C. hirta, Ethanolic extracts, Decoction. Key Message: Polar extracts from medicinal plants have antioxidant properties apart from its traditional use. These plants can be investigated to understand the full potential of these plants

Synthesis of MS-Labile Crosslinker to Determine Protein- Protein Interaction Networks in Various Biological Systems Using Crosslinking Mass Spectrometry

The purpose of this research is to synthesize a crossinker that is MS-labile and that produces fragments under MS (mass spectrometry) conditions that allows masses of the peptides determined by the name of LXR-SEB (Labile Crosslinker Reagent-Succinic Ethanolamine Biotin). The samples were prepared in a wet lab at the Institute for Systems Biology, tested using crosslinking MS methods, and finally purified using FPLC (Fast Protein Liquid Chromatography). The results were further analyzed by myself and my mentor, Dr. Isil Hamdemir. The final results showed that we did successfully obtain pure tEB and LXR-Amine, however, SEB was not obtained in the time allotted. When successfully formed and obtained in adequate amounts, this crosslinker will ultimately assist in the future of healthcare by allowing scientists to not only understand more about PPIs (protein-protein interactions) but also about what occurs inside a cell when it becomes diseased

Essays on Stock Investing and Investor Behavior

Chapter one shows that US households with high unconditional and cyclical labor income risk are more leveraged and allocate a greater share of their financial assets to stocks. I use self-reported risk preferences to show that rational sorting of risk tolerant workers into risky employment is responsible for this otherwise puzzling result. With risk preferences accounted for, I find evidence that households with greater permanent income variance reduce leverage and stock allocations to an extent consistent with theory. However, household portfolios and employment selection do not respond significantly to any of the other three forms of labor income risk I measure: disaster risk, permanent income cyclicality, and permanent income variance cyclicality. Chapter two reports evidence that individual investors in Indian equities hold better performing portfolios as they become more experienced in the equity market. Experienced investors tilt their portfolios profitably towards value stocks and stocks with low turnover, but these tilts do not fully explain their performance. Experienced investors also tend to have lower turnover and disposition bias. These behaviors, as well as underdiversification, diminish when investors experience poor returns resulting from them, consistent with models of reinforcement learning. Furthermore, Indian stocks held by experienced, well diversified, low-turnover and low-disposition-bias investors deliver higher average returns even controlling for a standard set of stock-level characteristics. Chapter three shows that news reflected by industry stock returns is only gradually incorporated into stock prices in other countries. Information links between cross-border portfolios play a significant role in explaining variation in the speed of this incorporation; responses to industry news are rapid across borders where portfolios share more crosslistings, equity analyst coverage, and a greater common equity investor base. The drift in returns following cross-border industry news has halved in the past 25 years. About half of this change relates to a growth in information links and reductions in expropriations risks facing foreign investors. A simple long-short trading strategy designed to exploit gradual diffusion of industry news across borders appears profitable, but is unlikely to yield returns as high as the 8 to 9 percent annual rate the strategy has returned historically.Economic

Exchange Rate Adjustment And Output In South-East Asia

This paper studies the effect of currency devaluation on aggregate output level in South- East Asian countries using panel data from Thailand, Malaysia, Indonesia and the Philippines for a period from 1980 to 2010. An empirical model that includes monetary, fiscal and exchange rate variables is developed. Two versions of the model, one with real exchange rate and another with nominal exchange rate and foreign-to-domestic price ratio are estimated. An error correction model is developed and the time series properties of the panel data are diagnosed before estimating the model. The estimated results suggest that currency devaluations are contractionary in the short run and the intermediate run and this contractionary effect comes from the change in nominal exchange rate and not from the change in foreign-to-domestic price ratio