Intraday REIT Liquidity

Real Estate Investment Trusts (REITs) may be classified as a real estate investment or more generally as an equity investment. While REITs are more liquid than direct real estate investments, the liquidity relationship between REITs and common stocks is less clear-cut. This study measures and analyzes the liquidity differences between REITs and other common stocks. The intraday variations documented in this study have implications for: 1) the appropriate timing of trades to minimize transaction costs and, 2) the substitutability of investments if illiquidity is priced. Our results reveal intraday patterns indicating lower liquidity for REITs than for common stocks when the liquidity measure is friction-based. In contrast, activity measures exhibit higher liquidity levels for REITs than for common stocks but this difference is only statistically significant at the beginning of the trading day. Finally, from an economic perspective we find that the ability to trade without influencing prices is 15-25% greater for non-REITS compared to REITs, and the price of immediacy is 7% higher for REITs.

A Genetic Porcine Model of Cancer

The large size of the pig and its similarity in anatomy, physiology, metabolism, and genetics to humans make it an ideal platform to develop a genetically defined, large animal model of cancer. To this end, we created a transgenic oncopig line encoding Cre recombinase inducible porcine transgenes encoding KRASG12D and TP53R167H, which represent a commonly mutated oncogene and tumor suppressor in human cancers, respectively. Treatment of cells derived from these oncopigs with the adenovirus encoding Cre (AdCre) led to KRASG12D and TP53R167H expression, which rendered the cells transformed in culture and tumorigenic when engrafted into immunocompromised mice. Finally, injection of AdCre directly into these oncopigs led to the rapid and reproducible tumor development of mesenchymal origin. Transgenic animals receiving AdGFP (green fluorescent protein) did not have any tumor mass formation or altered histopathology. This oncopig line could thus serve as a genetically malleable model for potentially a wide spectrum of cancers, while controlling for temporal or spatial genesis, which should prove invaluable to studies previously hampered by the lack of a large animal model of cancer

Bank risk and return: the impact of bank non-interest income

Purpose – The purpose of this paper is to consider the impact on bank risk of portfolio diversification between traditional margin income and fee-based income for banks operating in Australia. Design/methodology/approach – Considering several performance variables, this analysis compares the benefits of diversification across different bank types relative to margin income and fee income. Further, regression analysis considers bank risk and revenue concentration. Findings – This paper documents that fee-based income is riskier than margin income but offers diversification benefits to bank shareholders. While improving bank risk-return tradeoff, these benefits are of second order importance compared to the large negative impact of poor asset quality on shareholder returns. Practical implications – These results have implications for all stakeholders in Australian banks. The results suggest that shareholders of banks will benefit from increased bank exposure to non-interest income via diversification. From a regulatory perspective, diversification reduces the possibility of systemic risk, but caution must be offered with respect to banks pursuing absolute returns rather than monitoring risk-return trade-offs, and so exploiting the benefits of the implied guarantee offered by “too big to fail” However, shareholders should also monitor bank exposure to non interest income to ensure that they do not become over-exposed to the point where the volatility effect outweighs the diversification benefits. Originality/value – The results of this study suggest that Australian regulators should consider requiring increased disclosure of the composition of bank non-interest income. Such disclosure would aid in understanding the changing nature of banking in Australia. Given the recent sub-prime crisis in the USA and the role played by fee based income sourced from securitization, increased disclosure of the nature of bank non interest income is now of global importance. This disclosure is particularly germane within the context of the implementation of Basle II, with its increased emphasis upon market discipline, given that Stiroh found increased disclosure in this area is accompanied by improved market pricing for risk.Australia, Banks, Diversification, Income, Risk management