Elements of Volatility at High Frequency

Volatility is central in options pricing and risk management. It reflects the uncertainty of investors and the inherent instability of the economy. Time series methods are among the most widely applied scientific methods to analyze and predict volatility. Very frequently sampled data contain much valuable information about the different elements of volatility and may ultimately reveal the reasons for time varying volatility. The use of such ultra-high-frequency data is common to all three essays of the dissertation. The dissertation belongs to the field of financial econometrics. The first essay uses wavelet methods to study the time-varying behavior of scaling laws and long-memory in the five-minute volatility series of Nokia on the Helsinki Stock Exchange around the burst of the IT-bubble. The essay is motivated by earlier findings which suggest that different scaling laws may apply to intraday time-scales and to larger time-scales, implying that the so-called annualized volatility depends on the data sampling frequency. The empirical results confirm the appearance of time varying long-memory and different scaling laws that, for a significant part, can be attributed to investor irrationality and to an intraday volatility periodicity called the New York effect. The findings have potentially important consequences for options pricing and risk management that commonly assume constant memory and scaling. The second essay investigates modelling the duration between trades in stock markets. Durations convoy information about investor intentions and provide an alternative view at volatility. Generalizations of standard autoregressive conditional duration (ACD) models are developed to meet needs observed in previous applications of the standard models. According to the empirical results based on data of actively traded stocks on the New York Stock Exchange and the Helsinki Stock Exchange the proposed generalization clearly outperforms the standard models and also performs well in comparison to another recently proposed alternative to the standard models. The distribution used to derive the generalization may also prove valuable in other areas of risk management. The third essay studies empirically the effect of decimalization on volatility and market microstructure noise. Decimalization refers to the change from fractional pricing to decimal pricing and it was carried out on the New York Stock Exchange in January, 2001. The methods used here are more accurate than in the earlier studies and put more weight on market microstructure. The main result is that decimalization decreased observed volatility by reducing noise variance especially for the highly active stocks. The results help risk management and market mechanism designing.

The Gerbera cDNA Microarray: A Tool for Large-Scale Identification of Genes Involved in Flower Development

During the past ten years, large-scale transcript analysis using microarrays has become a powerful tool to identify and predict functions for new genes. It allows simultaneous monitoring of the expression of thousands of genes and has become a routinely used tool in laboratories worldwide. Microarray analysis will, together with other functional genomics tools, take us closer to understanding the functions of all genes in genomes of living organisms. Flower development is a genetically regulated process which has mostly been studied in the traditional model species Arabidopsis thaliana, Antirrhinum majus and Petunia hybrida. The molecular mechanisms behind flower development in them are partly applicable in other plant systems. However, not all biological phenomena can be approached with just a few model systems. In order to understand and apply the knowledge to ecologically and economically important plants, other species also need to be studied. Sequencing of 17 000 ESTs from nine different cDNA libraries of the ornamental plant Gerbera hybrida made it possible to construct a cDNA microarray with 9000 probes. The probes of the microarray represent all different ESTs in the database. From the gerbera ESTs 20% were unique to gerbera while 373 were specific to the Asteraceae family of flowering plants. Gerbera has composite inflorescences with three different types of flowers that vary from each other morphologically. The marginal ray flowers are large, often pigmented and female, while the central disc flowers are smaller and more radially symmetrical perfect flowers. Intermediate trans flowers are similar to ray flowers but smaller in size. This feature together with the molecular tools applied to gerbera, make gerbera a unique system in comparison to the common model plants with only a single kind of flowers in their inflorescence. In the first part of this thesis, conditions for gerbera microarray analysis were optimised including experimental design, sample preparation and hybridization, as well as data analysis and verification. Moreover, in the first study, the flower and flower organ-specific genes were identified. After the reliability and reproducibility of the method were confirmed, the microarrays were utilized to investigate transcriptional differences between ray and disc flowers. This study revealed novel information about the morphological development as well as the transcriptional regulation of early stages of development in various flower types of gerbera. The most interesting finding was differential expression of MADS-box genes, suggesting the existence of flower type-specific regulatory complexes in the specification of different types of flowers. The gerbera microarray was further used to profile changes in expression during petal development. Gerbera ray flower petals are large, which makes them an ideal model to study organogenesis. Six different stages were compared and specifically analysed. Expression profiles of genes related to cell structure and growth implied that during stage two, cells divide, a process which is marked by expression of histones, cyclins and tubulins. Stage 4 was found to be a transition stage between cell division and expansion and by stage 6 cells had stopped division and instead underwent expansion. Interestingly, at the last analysed stage, stage 9, when cells did not grow any more, the highest number of upregulated genes was detected. The gerbera microarray is a fully-functioning tool for large-scale studies of flower development and correlation with real-time RT-PCR results show that it is also highly sensitive and reliable. Gene expression data presented here will be a source for gene expression mining or marker gene discovery in the future studies that will be performed in the Gerbera Laboratory. The publicly available data will also serve the plant research community world-wide.

Functional Analysis of MrpL55, Vig and Mat1 Acting at the Crossroad of Cell Cycle, Transcription and Metabolism Regulation

Cell proliferation, transcription and metabolism are regulated by complex partly overlapping signaling networks involving proteins in various subcellular compartments. The objective of this study was to increase our knowledge on such regulatory networks and their interrelationships through analysis of MrpL55, Vig, and Mat1 representing three gene products implicated in regulation of cell cycle, transcription, and metabolism. Genome-wide and biochemical in vitro studies have previously revealed MrpL55 as a component of the large subunit of the mitochondrial ribosome and demonstrated a possible role for the protein in cell cycle regulation. Vig has been implicated in heterochromatin formation and identified as a constituent of the RNAi-induced silencing complex (RISC) involved in cell cycle regulation and RNAi-directed transcriptional gene silencing (TGS) coupled to RNA polymerase II (RNAPII) transcription. Mat1 has been characterized as a regulatory subunit of cyclin-dependent kinase 7 (Cdk7) complex phosphorylating and regulating critical targets involved in cell cycle progression, energy metabolism and transcription by RNAPII. The first part of the study explored whether mRpL55 is required for cell viability or involved in a regulation of energy metabolism and cell proliferation. The results revealed a dynamic requirement of the essential Drosophila mRpL55 gene during development and suggested a function of MrpL55 in cell cycle control either at the G1/S or G2/M transition prior to cell differentiation. This first in vivo characterization of a metazoan-specific constituent of the large subunit of mitochondrial ribosome also demonstrated forth compelling evidence of the interconnection of nuclear and mitochondrial genomes as well as complex functions of the evolutionarily young metazoan-specific mitochondrial ribosomal proteins. In studies on the Drosophila RISC complex regulation, it was noted that Vig, a protein involved in heterochromatin formation, unlike other analyzed RISC associated proteins Argonaute2 and R2D2, is dynamically phosphorylated in a dsRNA-independent manner. Vig displays similarity with a known in vivo substrate for protein kinase C (PKC), human chromatin remodeling factor Ki-1/57, and is efficiently phosphorylated by PKC on multiple sites in vitro. These results suggest that function of the RISC complex protein Vig in RNAi-directed TGS and chromatin modification may be regulated through dsRNA-independent phosphorylation by PKC. In the third part of this study the role of Mat1 in regulating RNAPII transcription was investigated using cultured murine immortal fibroblasts with a conditional allele of Mat1. The results demonstrated that phosphorylation of the carboxy-terminal domain (CTD) of the large subunit of RNAPII in the heptapeptide YSPTSPS repeat in Mat-/- cells was over 10-fold reduced on Serine-5 and subsequently on Serine-2. Occupancy of the hypophosphorylated RNAPII in gene bodies was detectably decreased, whereas capping, splicing, histone methylation and mRNA levels were generally not affected. However, a subset of transcripts in absence of Mat1 was repressed and associated with decreased occupancy of RNAPII at promoters as well as defective capping. The results identify the Cdk7-CycH-Mat1 kinase submodule of TFIIH as a stimulatory non-essential regulator of transcriptional elongation and a genespecific essential factor for stable binding of RNAPII at the promoter region and capping. The results of these studies suggest important roles for both MrpL55 and Mat1 in cell cycle progression and their possible interplay at the G2/M stage in undifferentiated cells. The identified function of Mat1 and of TFIIH kinase complex in gene-specific transcriptional repression is challenging for further studies in regard to a possible link to Vig and RISC-mediated transcriptional gene silencing.

Stress and developmental responses in Arabidopsis thaliana: regulation through the transcription factor-interacting protein RCD1

Plants constantly face adverse environmental conditions, such as drought or extreme temperatures that threaten their survival. They demonstrate astonishing metabolic flexibility in overcoming these challenges and one of the key responses to stresses is changes in gene expression leading to alterations in cellular functions. This is brought about by an intricate network of transcription factors and associated regulatory proteins. Protein-protein interactions and post-translational modifications are important steps in this control system along with carefully regulated degradation of signaling proteins. This work concentrates on the RADICAL-INDUCED CELL DEATH1 (RCD1) protein which is an important regulator of abiotic stress-related and developmental responses in Arabidopsis thaliana. Plants lacking this protein function display pleiotropic phenotypes including sensitivity to apoplastic reactive oxygen species (ROS) and salt, ultraviolet B (UV-B) and paraquat tolerance, early flowering and senescence. Additionally, the mutant plants overproduce nitric oxide, have alterations in their responses to several plant hormones and perturbations in gene expression profiles. The RCD1 gene is transcriptionally unresponsive to environmental signals and the regulation of the protein function is likely to happen post-translationally. RCD1 belongs to a small protein family and, together with its closest homolog SRO1, contains three distinguishable domains: In the N-terminus, there is a WWE domain followed by a poly(ADP-ribose) polymerase-like domain which, despite sequence conservation, does not seem to be functional. The C-terminus of RCD1 contains a novel domain called RST. It is present in RCD1-like proteins throughout the plant kingdom and is able to mediate physical interactions with multiple transcription factors. In conclusion, RCD1 is a key point of signal integration that links ROS-mediated cues to transcriptional regulation by yet unidentified means, which are likely to include post-translational mechanisms. The identification of RCD1-interacting transcription factors, most of whose functions are still unknown, opens new avenues for studies on plant stress as well as developmental responses.

The role of MADS and TCP transcription factors in Gerbera hybrida flower development

Angiosperms represent a huge diversity in floral structures. Thus, they provide an attractive target for comparative developmental genetics studies. Research on flower development has focused on few main model plants, and studies on these species have revealed the importance of transcription factors, such as MADS-box and TCP genes, for regulating the floral form. The MADS-box genes determine floral organ identities, whereas the TCP genes are known to regulate flower shape and the number of floral organs. In this study, I have concentrated on these two gene families and their role in regulating flower development in Gerbera hybrida, a species belonging to the large sunflower family (Asteraceae). The Gerbera inflorescence is comprised of hundreds of tightly clustered flowers that differ in their size, shape and function according to their position in the inflorescence. The presence of distinct flower types tells Gerbera apart from the common model species that bear only single kinds of flowers in their inflorescences. The marginally located ray flowers have large bilaterally symmetrical petals and non-functional stamens. The centrally located disc flowers are smaller, have less pronounced bilateral symmetry and carry functional stamens. Early stages of flower development were studied in Gerbera to understand the differentiation of flower types better. After morphological analysis, we compared gene expression between ray and disc flowers to reveal transcriptional differences in flower types. Interestingly, MADS-box genes showed differential expression, suggesting that they might take part in defining flower types by forming flower-type-specific regulatory complexes. Functional analysis of a CYCLOIDEA-like TCP gene GhCYC2 provided evidence that TCP transcription factors are involved in flower type differentiation in Gerbera. The expression of GhCYC2 is ray-flower-specific at early stages of development and activated only later in disc flowers. Overexpression of GhCYC2 in transgenic Gerbera-lines causes disc flowers to obtain ray-flower-like characters, such as elongated petals and disrupted stamen development. The expression pattern and transgenic phenotypes further suggest that GhCYC2 may shape ray flowers by promoting organ fusion. Cooperation of GhCYC2 with other Gerbera CYC-like TCP genes is most likely needed for proper flower type specification, and by this means for shaping the elaborate inflorescence structure. Gerbera flower development was also approached by characterizing B class MADS-box genes, which in the main model plants are known regulators of petal and stamen identity. The four Gerbera B class genes were phylogenetically grouped into three clades; GGLO1 into the PI/GLO clade, GDEF2 and GDEF3 into the euAP3 clade and GDEF1 into the TM6 clade. Putative orthologs for GDEF2 and GDEF3 were identified in other Asteraceae species, which suggests that they appeared through an Asteraceae-specific duplication. Functional analyses indicated that GGLO1 and GDEF2 perform conventional B-function as they determine petal and stamen identities. Our studies on GDEF1 represent the first functional analysis of a TM6-like gene outside the Solanaceae lineage and provide further evidence for the role of TM6 clade members in specifying stamen development. Overall, the Gerbera B class genes showed both commonalities and diversifications with the conventional B-function described in the main model plants.

Neuronal K-Cl Cotransporter : Transcriptional Mechanisms of KCC2 Gene Regulation

K-Cl cotransporter 2 (KCC2) maintains a low intracellular Cl concentration required for fast hyperpolarizing responses of neurons to classical inhibitory neurotransmitters γ-aminobutyric acid (GABA) and glycine. Decreased Cl extrusion observed in genetically modified KCC2-deficient mice leads to depolarizing GABA responses, impaired brain inhibition, and as a consequence to epileptic seizures. Identification of mechanisms regulating activity of the SLC12A5 gene, which encodes the KCC2 cotransporter, in normal and pathological conditions is, thus, of extreme importance. Multiple reports have previously elucidated in details a spatio-temporal pattern of KCC2 expression. Among the characteristic features are an exclusive neuronal specificity, a dramatic upregulation during embryonic and early postnatal development, and a significant downregulation by neuronal trauma. Numerous studies confirmed these expressional features, however transcriptional mechanisms predetermining the SLC12A5 gene behaviour are still unknown. The aim of the presented thesis is to recognize such transcriptional mechanisms and, on their basis, to create a transcriptional model that would explain the established SLC12A5 gene behaviour. Up to recently, only one KCC2 transcript has been thought to exist. A particular novelty of the presented work is the identification of two SLC12A5 gene promoters (SLC12A5-1a and SLC12A5-1b) that produce at least two KCC2 isoforms (KCC2a and KCC2b) differing by their N-terminal parts. Even though a functional 86Rb+ assay reveals no significant difference between transport activities of the isoforms, consensus sites for several protein kinases, found in KCC2a but not in KCC2b, imply a distinct kinetic regulation. As a logical continuation, the current work presents a detailed analysis of the KCC2a and KCC2b expression patterns. This analysis shows an exclusively neuron-specific pattern and similar expression levels for both isoforms during embryonic and neonatal development in rodents. During subsequent postnatal development, the KCC2b expression dramatically increases, while KCC2a expression, depending on central nervous system (CNS) area, either remains at the same level or moderately decreases. In an attempt to explain both the neuronal specificity and the distinct expressional kinetics of the KCC2a and KCC2b isoforms during postnatal development, the corresponding SLC12A5-1a and SLC12A5-1b promoters have been subjected to a comprehensive bioinformatical analysis. Binding sites of several transcription factors (TFs), conserved in the mammalian SLC12A5 gene orthologs, have been identified that might shed light on the observed behaviour of the SLC12A5 gene. Possible roles of these TFs in the regulating of the SLC12A5 gene expression have been elucidated in subsequent experiments and are discussed in the current thesis.

Ion-regulatory proreins in neuronal development and communication

Brain function is critically dependent on the ionic homeostasis in both the extra- and intracellular compartment. The regulation of brain extracellular ionic composition mainly relies on active transport at blood brain and at blood cerebrospinal fluid interfaces whereas intracellular ion regulation is based on plasmalemmal transporters of neurons and glia. In addition, the latter mechanisms can generate physiologically as well as pathophysiologically significant extracellular ion transients. In this work I have studied molecular mechanisms and development of ion regulation and how these factors alter neuronal excitability and affect synaptic and non-synaptic transmission with a particular emphasis on intracellular pH and chloride (Cl-) regulation. Why is the regulation of acid-base equivalents (H+ and HCO3-) and Cl- of such interest and importance? First of all, GABAA-receptors are permeable to both HCO3- and Cl-. In the adult mammalian central nervous system (CNS) fast postsynaptic inhibition relies on GABAA-receptor mediated transmission. Today, excitatory effects of GABAA-receptors, both in mature neurons and during the early development, have been recognized and the significance of the dual actions of GABA on neuronal communication has become an interesting field of research. The transmembrane gradients of Cl- and HCO3- determine the reversal potential of GABAA-receptor mediated postsynaptic potentials and hence, the function of pH and Cl- regulatory proteins have profound consequences on GABAergic signaling and neuronal excitability. Secondly, perturbations in pH can cause a variety of changes in cellular function, many of them resulting from the interaction of protons with ionizable side chains of proteins. pH-mediated alterations of protein conformation in e.g. ion channels, transporters, and enzymes can powerfully modulate neurotransmission. In the context of pH homeostasis, the enzyme carbonic anhydrase (CA) needs to be taken into account in parallel with ion transporters: for CO2/HCO3- buffering to act in a fast manner, CO2 (de)hydration must be catalyzed by this enzyme. The acid-base equivalents that serve as substrates in the CO2 dehydration-hydration reaction are also engaged in many carrier and channel mediated ion movements. In such processes, CA activity is in key position to modulate transmembrane solute fluxes and their consequences. The bicarbonate transporters (BTs; SLC4) and the electroneutral cation-chloride cotransporters (CCCs; SLC12) belong the to large gene family of solute carriers (SLCs). In my work I have studied the physiological roles of the K+-Cl- cotransporter KCC2 (Slc12a5) and the Na+-driven Cl--HCO3- exchanger NCBE (Slc4a10) and the roles of these two ion transporters in the modualtion of neuronal communication and excitability in the rodent hippocampus. I have also examined the cellular localization and molecular basis of intracellular CA that has been shown to be essential for the generation of prolonged GABAergic excitation in the mature hippocampus. The results in my Thesis provide direct evidence for the view that the postnatal up-regulation of KCC2 accounts for the developmental shift from depolarizing to hyperpolarizing postsynaptic EGABA-A responses in rat hippocampal pyramidal neurons. The results also indicate that after KCC2 expression the developmental onset of excitatory GABAergic transmission upon intense GABAA-receptor stimulation depend on the expression of intrapyramidal CA, identified as the CA isoform VII. Studies on mice with targeted Slc4a10 gene disruption revealed an important role for NCBE in neuronal pH regulation and in pH-dependent modulation of neuronal excitability. Furthermore, this ion transporter is involved in the basolateral Na+ and HCO3- uptake in choroid plexus epithelial cells, and is thus likely to contribute to cerebrospinal fluid production.

Novel Molecular Mechanisms of Arabidopsis Disease Resistance

Plants are capable of recognizing phytopathogens through the perception of pathogen-derived molecules or plant cell-wall degradation products due to the activities of pathogen-secreted enzymes. Such elicitor recognition events trigger an array of inducible defense responses involving signal transduction networks and massive transcriptional re-programming. The outcome of a pathogen infection relies on the balance between different signaling pathways, which are integrated by regulatory proteins. This thesis characterized two key regulatory components: a damage control enzyme, chlorophyllase 1 (AtCHL1), and a transcription factor, WRKY70. Their roles in defense signaling were then investigated. The Erwinia-derived elicitors rapidly activated the expression of AtCLH1 and WRKY70 through different signaling pathways. The expression of the AtCHL1 gene was up-regulated by jasmonic acid (JA) but down-regulated by salicylic acid (SA), whereas WRKY70 was activated by SA and repressed by JA. In order to elucidate the functions of AtCLH1 and WRKY70 in plant defense, stable transgenic lines were produced where these genes were overexpressed or silenced. Additionally, independent knockout lines were also characterized. Bacterial and fungal pathogens were then used to assess the contribution of these genes to the Arabidopsis disease resistance. The transcriptional modulation of AtCLH1 by either the constitutive over-expression or RNAi silencing caused alterations in the chlorophyll-to-chlorophyllide ratio, supporting the claim that chlorophyllase 1 has a role in the chlorophyll degradation pathway. Silencing of this gene led to light-dependent over-accumulation of the reactive oxygen species (ROS) in response to infection by Erwinia carotovora subsp. carotovora SCC1. This was followed by an enhanced induction of SA-dependent defense genes and an increased resistance to this pathogen. Interestingly, little effect on the pathogen-induced SA accumulation at the early infection was observed, suggesting that action of ROS might potentiate SA signaling. In contrast, the pathogen-induced JA production was significantly reduced in the RNAi silenced plants. Moreover, JA signaling and resistance to Alternaria brassicicola were impaired. These observations provide support for the argument that the ROS generated in chloroplasts might have a negative impact on JA signaling. The over-expression of WRKY70 resulted in an enhanced resistance to E. carotovora subsp. carotovora SCC1, Pseudomonas syringae pv. tomato DC3000 and Erysiphe cichoracearum UCSC1, whilst an antisense suppression or an insertional inactivation of WRKY70 led to a compromised resistance to E. carotovora subsp. carotovora SCC1 and to E. cichoracearum UCSC1 but not to P. syringae pv. tomato DC3000. Gene expression analysis revealed that WRKY70 activated many known defense-related genes associated with the SAR response but suppressed a subset of the JA-responsive genes. In particular, I was able to show that both the basal and the induced expression of AtCLH1 was enhanced by the antisense silencing or the insertional inactivation of WRKY70, whereas a reduction in AtCLH1 expression was observed in the WRKY70 over-expressors following an MeJA application or an A. brassicicola infection. Moreover, the SA-induced suppression of AtCLH1 was relieved in wrky70 mutants. These results indicate that WRKY70 down-regulates AtCLH1. An epistasis analysis suggested that WRKY70 functions downstream of the NPR1 in an SA-dependent signaling pathway. When challenged with A. brassicicola, WRKY70 over-expressing plants exhibited a compromised disease resistance while wrky70 mutants had the opposite effect. These results confirmed the WRKY70-mediated inhibitory effects on JA signaling. Furthermore, the WRKY70-controlled suppression of A. brassicicola resistance was mainly through an NPR1-dependent mechanism. Taking all the data together, I suggest that the pathogen-responsive transcription factor WRKY70 is a common component in both SA- and JA-dependent pathways and plays a crucial role in the SA-mediated suppression of JA signaling.

Transposable elements in a marginal plant population

Background
How new forms arise in nature has engaged evolutionary biologists since Darwin's seminal treatise on the origin of species. Transposable elements (TEs) may be among the most important internal sources for intraspecific variability. Thus, we aimed to explore the temporal dynamics of several TEs in individual genotypes from a small, marginal population of Aegilops speltoides. A diploid cross-pollinated grass species, it is a wild relative of the various wheat species known for their large genome sizes contributed by an extraordinary number of TEs, particularly long terminal repeat (LTR) retrotransposons. The population is characterized by high heteromorphy and possesses a wide spectrum of chromosomal abnormalities including supernumerary chromosomes, heterozygosity for translocations, and variability in the chromosomal position or number of 45S and 5S ribosomal DNA (rDNA) sites. We propose that variability on the morphological and chromosomal levels may be linked to variability at the molecular level and particularly in TE proliferation.

Results
Significant temporal fluctuation in the copy number of TEs was detected when processes that take place in small, marginal populations were simulated. It is known that under critical external conditions, outcrossing plants very often transit to self-pollination. Thus, three morphologically different genotypes with chromosomal aberrations were taken from a wild population of Ae. speltoides, and the dynamics of the TE complex traced through three rounds of selfing. It was discovered that: (i) various families of TEs vary tremendously in copy number between individuals from the same population and the selfed progenies; (ii) the fluctuations in copy number are TE-family specific; (iii) there is a great difference in TE copy number expansion or contraction between gametophytes and sporophytes; and (iv) a small percentage of TEs that increase in copy number can actually insert at novel locations and could serve as a bona fide mutagen.

Conclusions
We hypothesize that TE dynamics could promote or intensify morphological and karyotypical changes, some of which may be potentially important for the process of microevolution, and allow species with plastic genomes to survive as new forms or even species in times of rapid climatic change.