Factors Correlated with Equity Market Risk Premiums in Developed and Emerging Markets

This paper re-examines how three theory-suggested factors affect equity returns - specified as risk-premiums - and how the results differ between developed and emerging markets. Traditional time series or cross-sectional regression procedures have yielded inconclusive evidence on maintained hypotheses about the determinants of equity premiums. However, on pooling observations, our estimated coefficients are much more accurate. Using panel data regression, we find that the risk premiums of developed appear to be affected by variation in the three factors within the equity markets of countries. In the emerging Asian markets, the risk premiums are affected more by the variation over time in at least one of the same three factors.

How Capital Structure Adjusts Dynamically during Financial Crisis

The availability of a unique data set of financially distressed firms enabled this study to apply the dynamic capital structure adjustment model to a study of capital structure. In addition, the factors driving capital structure adjustment of financially distressed and of healthy firms were estimated. The results identified 13 significant variables, which included many macroeconomic variables previously not studied, thus evidence is produced of the impact of macroeconomic factors on capital structure for the first time. We also estimated the adjustment parameters using a new dynamic adjustment model applied to an unbalanced panel data set of distressed and healthy firms. It is found that the adjustment parameters are different in the short term and long term. These new findings add to the capital structure literature.

The Role of Non-Parity Fundamentals in Exchange Rate Determination: Australia and the Asia Pacific Region

This paper extends the literature by looking at the contribution of non-parity variables after extracting the impact of parity variables on exchange rates of Australia and the Asia Pacific countries. Exchange rates are examined using high- and low-frequency multi-country panel time series data for a group of trade-related nations in the Asia Pacific, including Japan. Our findings suggest that exchange rate is affected by growth rate, and trade and capital flows: other less significant variables include sovereign debt; balance of payments; money supply; and trade openness. It also confirms that interest rate has significant effect on exchange rates while price effect is not significant in short run regressions. These key findings are robust across different time intervals, thus showing new findings on the exchange rate dynamics consistent with theories.

The Determinants of Bank Capital Ratios in a Developing Economy

This paper reports new findings on the determinants of bank capital ratios. The results are from an unbalanced panel data set spanning eight years around the period of the 1997-1998 Asian financial crisis. Test results suggest a strong positive link between regulatory capital and bank management?s risk-taking behaviour. The risk-based capital standards of the regulators did not have an influence on how regulatory capital is adjusted by low-capitalized banks, perhaps due to the well-documented banking fragility during the test period. Finally, bank capital decisions seem not to be driven by bank profitability, which finding is inconsistent with developed country literature that has for long stressed the importance of banks? earnings as driving capital ratios. Although the study focuses only on one developing economy, these findings may help to identify the correlates of bank capital ratios in both developed and developing economies since this topic has received scant attention of researchers. These findings are somewhat consistent with how banks engaging in risky lending across the world could have brought on the 2007-2008 banking liquidity and capital erosion crisis.

Outward FDI from Southeast Asia: The Malaysian Experience

This paper analyses the trends, patterns and determinants of outward foreign direct investment (OFDI) by Malaysian companies. It shows that Malaysian OFDI ha d taken a quantum leap since 19 93 and the number of Malaysian TNCs investing abroad since the 1990s has increased significantly. The OFDI is focused mainly in services ( finance , banking, insurance and tourism) and natural resources (oil and gas) with manufacturing a distant third. This also includes the emergence of off shore financial centres and developed countries as the most important host region for trans - border activity although investment s in developing countries especially within ASEAN have shown tremendous growth. The key drivers of OFDI have been to increase efficiency, to access resources and to access markets

Coherent Patterning of Matter Waves with Subwavelength Localization

We propose the Subwavelength Localization via Adiabatic Passage (SLAP) technique to coherently achieve state-selective patterning of matter waves well beyond the diffraction limit. The SLAP technique consists in coupling two partially overlapping and spatially structured laser fields to three internal levels of the matter wave yielding state-selective localization at those positions where the adiabatic passage process does not occur. We show that by means of this technique matter wave localization down to the single nanometer scale can be achieved. We analyze in detail the potential implementation of the SLAP technique for nano-lithography with an atomic beam of metastable Ne* and for coherent patterning of a two-component 87Rb Bose-Einstein condensate.Comment: 6 pages, 5 figure

January Effect on the Thinly Traded KLSE: Tests with Appropriate Refinements

Over recent years the January Effect has been documented as an anomaly on stock markets around the world. The January regularity refers to the phenomenon that security returns in early January are higher than in any other period of the year. The pesence of the January Regularity on the Kuala Lumpur Stock Exchange (KLSE) has been established. However, this study investigates further the possible explanations, taking into consideration the returns on stocks rather than indices, contml for thinness of trading and the association of the regularity with size effects. The evidence indicates that returns on 298 stocks traded in KSLE do exhibit the January seasonality, and the average returns net of cost for January are 1. 75 per cent. However, these net average returns are not adjusted for 1isk, therefore it is difficult to confirm the valuational efficiency of the regularity. In contrast to the documented evidence in developed securities markets, the size effect cannot rationalise the regularity in the developing Kuala Lumpur Stock Excrhange. The possibility of the thinness of trading as a factor that could partially eXplain the regularity is support

Isolation of a kojic acid-producing fungus capable of using starch as a carbon source

A fungal strain (S33-2), able to grow on cooked starch and produce a substantially high level of kojic acid, was isolated from morning glory flower (Bixa orellana). The fungus was characterized and identified as Aspergillus flavus. The effect of different types of starch (sago, potato and corn starch) on growth of strain S33-2 and kojic acid production was examined using shake flasks. It was found that strain S33-2 grew well on all types of starch investigated. However, kojic acid production was highest when corn starch was used, with the maximum kojic acid obtained being comparable to fermentation using glucose. The highest kojic acid production (19.2 g l-1) was obtained when 75 g l-1 corn starch was used. This gave a yield, based on starch consumed, and an overall productivity of 0.256 g g-1 and 0.04 g l-1 h-1, respectively