bluuebunny/crossref_metadata_2025_split huggingface dataset:
The nature of randomness
Authors: Powers Michael R. 
Published: March 2008

PurposeThe purpose of the paper, in this two‐part series, is to consider certain intriguing aspects of randomness, the basic mathematical concept used to model financial risk and other unknown quantities in the physical world.Design/methodology/approachIn Part 2 of the paper, the author describes methods for simulating random variables, and explores whether it is possible in practice to distinguish between the knowable complexity of compressible random variables and the unknowable complexity of incompressible random variables.FindingsIn Part 2 of the paper, it is found that because of Chaitin's impossibility result (regarding incompressible sequences) and the possibility of constructing least‐surprising sequences, one is left with two cognitive constraints with serious implications for statistical hypothesis testing and the scientific method.Originality/valueThis two‐part paper explores the underlying nature of randomness in terms of both its physical/mathematical properties and its role in human cognition.
A practical approach to blend insurance in the banking network
Authors: Artikis Panayiotis G. , Mutenga Stanley , Staikouras Sotiris K. 
Published: March 2008

PurposeThe purpose of this paper is to look at the main empirical findings related to the bank‐insurance model and to outline the market practices across the world. The market dynamics underpinning the bancassurance phenomenon are analyzed alongside discussions of the various bancassurance products and bank‐insurance modes of entry.Design/methodology/approachThe paper presents a brief survey of the bank‐insurance trend and provides an insight into the underlying dynamics and corporate structures of financial conglomerates.FindingsThere is an uneven success of the bancassurance phenomenon across the world. It is not clear whether re‐regulation is the cause or response to globalization, and vice versa, which in turn both shape the bancassurance arena. A number of incentives for the formation of financial conglomerates are identified. Finally, three modes of entry have been documented to reflect market realities.Originality/valueThe paper will be of value to those interested in financial conglomerates, banking and insurance. It is suitable for academics and practitioners alike.
Reputation entrenchment or risk minimization?
Authors: Li Xun , Wu Zhenyu 
Published: March 2008

PurposeOne of the agency conflicts between investors and managers in fund management is reflected by risk‐taking behaviors led by their different goals. The investors may stop their investments in risky assets before the end of the investment horizon to minimize risk, while the managers may do so to entrench their reputation so as to pursue better opportunities in the labor market. This study aims to consider a one principal‐one agent model to investigate this agency conflict.Design/methodology/approachThe paper derives optimal asset allocation strategies for both parties by extending the traditional dynamic mean‐variance model and considering possibilities of optimal early stopping. Doing so illustrates the principal‐agent conflict regarding risk‐taking behaviors and managerial investment myopia in fund management.Practical implicationsThis paper not only paves the way for further studies along this line, but also presents results useful for practitioners in the money management industry.FindingsAccording to the theoretical analysis and numerical simulations, the paper shows that potential early stop can make the agency conflict worsen, and it proposes a way to mitigate this agency problem.Originality/valueAs one of the exploratory studies in investigating agency conflict regarding risk‐taking behaviors in the literature, this study makes multiple contributions to the literature on fund management, asset allocation, portfolio optimization, and risk management.
Moments of the time of ruin in a renewal risk model with discounted penalty
Authors: Thampi K.K. , Jacob M.J. 
Published: March 2008

PurposeThis paper considers a Sparre Andersen risk process for which the claims inter‐arrival distribution is Generalized Exponential. The purpose of this paper is to find explicit expressions for the moments of time to ruin when a penalty is imposed at ruin.Design/methodology/approachThe study is focused on the function ϕδ(u), the expected discounted penalty, which is due at ruin and may depend on the deficit at the time of ruin and also on the surplus prior to ruin. It shows that ϕδ(u) satisfies an integro‐differential equation which is solved using Laplace transforms.FindingsThe authors have chosen a penalty function, which is independent of the surplus immediately before ruin, and a closed form expression is obtained for ϕδ(u), and then solved for the moments of time to ruin.Originality/valueNew results are derived, many of which have mathematical and probabilistic interpretations, and additional insight is gained for the results in the renewal risk model.
Asian options versus vanilla options: a boundary analysis
Authors: Ye George L. 
Published: March 2008

PurposeThe purpose of the paper is to correct a commonly mistaken notion that an Asian option is always cheaper than its plain vanilla European counterpart in a general setting.Design/methodology/approachThe paper shows that by letting volatility go to zero, the lower bounds of Asian options and vanilla options are derived. Those bounds are then compared.FindingsThe paper finds that the notion can be violated for call options when the dividend yield of the underlying stock is higher than the interest rate, as well as for put options when the dividend yield of the underlying stock is lower than the interest rate.Research limitations/implicationsThe approach used in this paper, boundary analysis, can be applied to other exotic options.Practical implicationsThe results in the paper may affect decisions on trading Asian options.Originality/valueThe paper will be of value to those interested in using/pricing/hedging Asian options.
Simultaneous output and input hedging: a decision analysis
Authors: Alghalith Moawia 
Published: March 2008

PurposeThe purpose of this paper is to present a realistic hedging model.Design/methodology/approachThe paper uses a general utility function, general distributions, and a multiple‐input technology.FindingsThe study finds that the impact of one or both risks on the optimal output, hedge, or hedge ratio is determined by the market structure of one or both forward pieces.Originality/valueThis is the first paper that uses a general, complete, and realistic hedging model.
Work in progress?
Authors: Gentle Chris 
Published: March 2008

PurposeThis paper aims to focus on recent developments within the financial markets.Design/methodology/approachThe approach is that of critical commentary on the present situation.FindingsCurrent market dynamics reinforce the fact that there are few greater issues for financial institutions than governance and control systems.Originality/valueThe paper shows that financial institutions are still seeking to find the correct balance between risk and reward among the forces of financial innovation.
Liquidity=Diversity
Authors: Mainelli Michael 
Published: March 2008

PurposeThis paper aims to offer a commentary on recent failures in financial markets.Design/methodology/approachThe approach is that of critical commentary on the present situation.FindingsCurrent market dynamics reinforce the fact that there are few greater issues for financial institutions than governance and control systems.Originality/valueThe paper shows that financial institutions are still seeking to find the correct balance between risk and reward among the forces of financial innovation.
The Stoneridge case – much ado about nothing?
Authors: Edison Andrew 
Published: March 2008

PurposeThe purpose of this paper is to explain the issues related to “scheme liability” that underlie the current case before the United States Supreme Court, Stoneridge Investment Partners v. Scientific‐Atlanta and Motorola.Design/methodology/approachExplains the facts of the Stoneridge case; explains the legal framework, including ongoing debates over the scope of liability under Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b‐5, the Supreme Court's decision in Central Bank, N.A. v. First Interstate Bank, development of the “scheme liability” concept by various plaintiffs' lawyers, and three circuit court decisions related to scheme liability; and the philosophy that is likely to guide the Supreme Court in Stoneridge.FindingsThe Stoneridge case provides the Supreme Court with the unique opportunity to clarify the limits of liability under Section 10(b) and Rule 10b‐5. It is the first time since Central Bank that the Supreme Court will grapple with the contours of liability for so‐called secondary actors.Originality/valueA clear explanation of the issues in a highly visible Supreme Court case by an experienced commercial litigator.
The FSA begins to “think tough” on insider dealing: but will thoughts turn to deeds?
Authors: Black Duncan , Lercara Angelo , Smallhoover Joe , Huey‐Burns Paul 
Published: March 2008

PurposeThe purpose of this paper is to assess the FSA's recent, allegedly soft approach toward insider trading and compare it with current approaches in the USA, France, and GermanyDesign/methodology/approachDiscusses reasons for the FSA's current approach, including its emphasis on “principles‐based” regulation and its policy against being an “enforcement‐led” organization and, for comparison, provides the perpectives of Dechert lawyers on current enforcement trends in the USA, France and Germany.FindingsThe prosecution of insider trading is one of the best examples of principles‐based regulation in the USA, which suggests that a debate concerning whether the FSA should adopt “rules” proscribing insider trading before embarking on a campaign of vigorous prosecution may be largely irrelevant if the will exists to address such activity. This article was originally published internally by Dechert LLP in April 2007 and has since been updated for the Journal of Investment Compliance.Originality/valueThe paper assesses the FSA's recent approach toward insider trading in the UK.
Providers and distributors: responsibilities regarding retail structured products
Authors: Rouch David , Benjamin Joanna , Raffan Michael , Kalderon Mark , Orton Simon 
Published: March 2008

PurposeThe purpose of this paper is to provide an overview of recent guidance from the FSA and industry, and recent case law regarding product providers and distributorsDesign/methodology/approachExplains current status of the guidance; provides overview of the guidance and its two component parts directed at “product providers” and “distributors”; discusses international dimensions; explains compliance implications; describes parallel trade association principles published in a July 2007 paper entitled Retail Structured Products: Principles for Managing the Provider‐Distributor Relationship; and summarizes three recent English judicial decisions relevant to the responsibilities and duties of providers and distributors.FindingsThe responsibilities of providers and distributors regarding retail structured products are being defined by an interaction of regulatory, common law, and soft law provisions. Just as the FSA's exercise of its regulatory powers is increasingly based less on detailed rules and more on general principles, so the judges' decision making is based less on doctrinal detail and more on a pragmatic assessment of the relevant facts as a whole.Practical implicationsRegarding retail products, the best approach for providers and distributors is to focus not only on detailed rules and contractual provisions but also on the factual detail of the arrangements, and whether the outcomes are fair to investors and meet their reasonable expectations as created by the firm.Originality/valueExpert analysis provided by leading lawyers specialized in financial institutions.
The changing tax environment for the UK hedge fund sector
Authors: Ward Dana 
Published: March 2008

PurposeThe purpose of this paper is to summarize the main conditions that a UK investment manager has to meet in order to benefit from a UK tax exemption known as the Investment Manager Exemption (IME) and comment on the key developments introduced in the revised Statement of Practice.Design/methodology/approachProvides background explaining legislation that defines the IME and its Qualifying Conditions and then goes on to explain the impact of the revised Statement of PracticeFindingsThe IME is an exemption for non‐residents trading in certain investments in the UK where that trade is carried on through an investment manager. The IME was introduced in order to promote investment activities in the UK by providing some degree of certainty on the tax treatment of UK managers who manage offshore trading funds. The original Statement of Practice 01/2001 (SP 01/01) was issued by HMRC to provide guidance on the application of the legislation and, more specifically, on how the conditions in relation to the IME are satisfied. The policy aims of the revised Statement of Practice are to improve the IME and also to meet new developments in the investment management industry, thus providing more certainty in relation to the scope and application of the rules.Practical implicationsIt is critical that processes are in place to demonstrate satisfaction of the Qualifying Conditions for the tax exemption; and in particular, contemporaneous and detailed transfer pricing documentation needs to be in place for all but the simplest of structures.Originality/valuePractical guidance from a tax partner of a leading accounting firm.
SEC adopts Amendments to Rule 105 of Regulation M, including important exceptions for bona fide purchases and for separate accounts
Authors: Gittleman Charles S. , Sacks Russell D. 
Published: March 2008

PurposeThe purpose of this paper is to provide a detailed description of Amendments to Rule 105 of Regulation M adopted by the US Securities and Exchange Commission (the “SEC”) on June 20, 2007Design/methodology/approachPresents a general overview of short sales and the purpose of Regulation M, a rule that prohibits purchases and sales of securities during specified periods close in time to public offerings of securities; and describes the Amendments, including an expansion of the prohibition under the Rule from a prohibition on “covering” to a prohibition on purchases generally and including three exceptions that pertain to “bona fide” purchases, “separate accounts,” and investment companies.FindingsThe Amendments are important because: they expand the scope of the Rule's basic prohibition; they were expanded in part because SEC perceived that circumvention of the Rule was persistent; they permit notable exceptions; and they were adopted close in time to other amendments to the regulation of short sales, including elimination of the price or “tick” tests.Originality/valueExpert guidance on a recent SEC ruling by experienced securities lawyers.
Taking the risk out of mutual fund compliance: a seven‐step check list for safer, more cost‐efficient mutual fund sales
Authors: Levering Jeff 
Published: March 2008

PurposeThe purpose of this paper is to explain the risk of bad mutual fund data for a financial services firm that sells mutual funds and to recommend steps a firm can take to ensure the reliability of its mutual fund data.Design/methodology/approachExplains problems caused by missing data, including the “breakpoint issue,” the best sources of mutual fund information, problems firms have retrieving and compiling that information, and weaknesses in a free service (the “Service”) provided by a well known industry utility and securities depository that related to coverage, completeness, and cost. Recommends seven actionable steps a firm can take to ensure the accuracy of its mutual fund data.FindingsFirms offering funds may sell billions of dollars of funds every week, and maintain considerably more on their books, but frequently they pay scant attention to the accuracy of their mutual fund reference data. The breakpoint issue is alive and well today, and would seriously erode investor and regulatory confidence if this fact became better known. For many firms, discrepancies in data result from funds having one policy disclosed to the SEC while their distributors use entirely different ones. Firms now realize that ensuring accurate reference data is no longer an issue that can be avoided.Practical implicationsRather than operating under the false assumption that critical data is accurate, make sure you dedicate the time to examine your organization's use of mutual fund data to ensure efficient, ongoing investor relations and to ensure the overall reputation of your firm.Originality/valueProfessional advice from an experienced vendor of compliance systems and software.
Summary of selected FINRA Regulatory Notices and Disciplinary Actions
Authors: Davis Henry A. 
Published: March 2008

PurposeThe purpose of this summary is to provide excerpts of selected Financial Industry Regulatory Authority (FINRA) Regulatory Notices issued from October to December 2007 and a sample of disciplinary actions during that period. In July 2007, FINRA Regulatory Notices replaced NASD Notices to Members.Design/methodology/approachProvides excerpts from FINRA Reg Notice 07‐54, Fairness Opinions; Reg Notice 07‐57, Representation of Parties in Arbitration and Mediation; Reg Notice 07‐59, Supervision of Electronic Communications; Reg Notice 07‐61, Trade Reporting and Compliance Engine (TRACE), and Reg Notice 07‐65, Amendments to NYSE Rule 409(f).FindingsThe paper finds useful information in each of these Notices.Originality/valueThese are direct excerpts designed to provide a useful digest for the reader and an indication of regulatory trends. The FINRA staff is aware of this summary but has neither reviewed nor edited it. For further detail and FINRA contacts for each notice, as well as other notices and useful information, the reader is directed to www.finra.org
Global engineering networks (GEN)
Authors: Zhang Yufeng , Gregory Mike , Shi Yongjiang 
Published: March 2008

PurposeThe purpose of this paper is to propose an integrating framework for the configuration and performance of global engineering networks (GEN).Design/methodology/approachThe reported study is based on a comprehensive literature review and refined by the practice of three global leading companies along key industry sectors.FindingsThis framework presents the key patterns of GEN from an evolution perspective and demonstrates the influence of the major driving forces.Research limitations/implicationsIn addition, this study also identifies research opportunities in two areas: further testing the theory of GEN with a broader range of industry sectors, and expanding the study to inter‐firm engineering activities. The further study is planned accordingly.Originality/valueThe paper offers a systematic view of GEN and can help companies in the design and operation.
The importance of collaborative frontloading in automotive supply networks
Authors: Binder Mario , Gust Peter , Clegg Ben 
Published: March 2008

PurposeThe purpose of this paper is to investigate how research and development (R&D) collaboration takes place for complex new products in the automotive sector. The research aims to give guidelines to increase the effectiveness of such collaborations.Design/methodology/approachThe methodology used to investigate this issue was grounded theory. The empirical data were collected through a mixture of interviews and questionnaires. The resulting inducted conceptual models were subsequently validated in industrial workshops.FindingsThe findings show that frontloading of the collaborative members was a major issue in managing successful R&D collaborations.Research limitations/implicationsThe limitation of this research is that it is only based in the German automotive industry.Practical implicationsPractical implications have come out of this research. Models and guidelines are given to help make a success of collaborative projects and their potential impacts on time, cost and quality metrics.Originality/valueFrontloading is not often studied in a collaborative manner; it is normally studied within just one organisation. This study has novel value because it has involved a number of different members throughout the supplier network.
Innovation performance and partnerships in manufacturing firms in Turkey
Authors: Cetindamar Dilek , Ulusoy Gunduz 
Published: March 2008

PurposeThis paper aims to shed light on the relationship between partnerships and innovation efforts of the firms. The goal is to understand whether Turkish firms collaborate for innovation or not and, if they do, what is the impact of partnerships on the innovation performance of firms?Design/methodology/approachIn this research, a survey methodology is employed. The questionnaire is implemented through structured interviews conducted with 135 Turkish companies from the textile, chemical, food and machinery industries.FindingsThe findings show that Turkish firms have high‐collaboration ties with other companies in particular but the existing partnerships have a weak impact on innovation performance.Research limitations/implicationsAs only one country is studied and data come from one year, the findings of this study are limited in terms of generalizing the results for a wide variety of developing countries.Practical implicationsNon‐materialized performance is to a degree due to low quality of relationships, but more importantly Turkish firms need to find ways to improve their partnerships and in‐house capabilities, particularly their absorptive capacities, if they want to improve their innovativeness through partnerships.Originality/valueThis paper is one of the early examples empirically investigating the relationship between technology collaborations and innovation performance of firms in a developing country context.
Digital/web‐based technology in purchasing and supply management: a UK study
Authors: Gallear David , Ghobadian Abby , O'Regan Nicholas 
Published: March 2008

PurposeTo date little is known about the actual level of utilisation of digital/web‐based interaction technologies in purchasing and supply management (SM) in the UK. This paper seeks to address this gap in the extant knowledge through empirical research in a UK setting. It examines the level of usage, the uses, the perceived benefits, and future perspective on the use, of web‐based technology in purchasing and SM.Design/methodology/approachAn empirical survey of UK‐based organisations was undertaken. Information simultaneously collected on the buyer‐supplier relationship orientation of the firms in the sample was used to test the proposition that the use of web‐based technology leads to stronger collaborative relationships with suppliers.FindingsData obtained from 156 valid responses indicated that six in every ten organisations use web‐based technology to support purchasing and SM activities, but that the usage is lower in small to medium‐sized enterprises. The main uses reported are for communicating with suppliers, for marketing products/services, and for locating technical data. Making purchases over the internet was significantly more prevalent in organisations exhibiting relatively more partnership orientation.Practical implicationsThe findings provide only limited evidence in support of the proposition that the deployment of web‐based technology leads to stronger buyer‐supplier relations. However, findings do suggest that the effectiveness of the purchasing and supply function can be enhanced through greater use of web‐based technology for online purchasing and for efficient consumer response.Originality/valueThe paper establishes salient UK managerial perception on the strategic and operational importance of web‐based technology adoption in purchasing and SM.