Essays on the Linkages Between Financial Markets, and Risk Asymmetries (summary section only)

During the last few decades there have been far going financial market deregulation, technical development, advances in information technology, and standardization of legislation between countries. As a result, one can expect that financial markets have grown more interlinked. The proper understanding of the cross-market linkages has implications for investment and risk management, diversification, asset pricing, and regulation. The purpose of this research is to assess the degree of price, return, and volatility linkages between both geographic markets and asset categories within one country, Finland. Another purpose is to analyze risk asymmetries, i.e., the tendency of equity risk to be higher after negative events than after positive events of equal magnitude. The analysis is conducted both with respect to total risk (volatility), and systematic risk (beta). The thesis consists of an introductory part and four essays. The first essay studies to which extent international stock prices comove. The degree of comovements is low, indicating benefits from international diversification. The second essay examines the degree to which the Finnish market is linked to the “world market”. The total risk is divided into two parts, one relating to world factors, and one relating to domestic factors. The impact of world factors has increased over time. After 1993, when foreign investors were allowed to freely invest in Finnish assets, the risk level has been higher than previously. This was also the case during the economic recession in the beginning of the 1990’s. The third essay focuses on the stock, bond, and money markets in Finland. According to a trading model, the degree of volatility linkages should be strong. However, the results contradict this. The linkages are surprisingly weak, even negative. The stock market is the most independent, while the money market is affected by events on the two other markets. The fourth essay concentrates on volatility and beta asymmetries. Contrary to many international studies there are only few cases of risk asymmetries. When they occur, they tend to be driven by the market-wide component rather than the portfolio specific element.

The Organisation of Policy Meets the Commercialisation of Sex - Global Linkages, Policies, Technologies

During recent years the commercialisation of sex has increased and intensified both locally and globally. This thesis explores the commercialisation of bodies, sex and sexualities, particularly the sex trade, and the impact of rapidly evolving information and communication technologies on this globalising trade. The main focus of this work is on the policies, discourses and policy developments in the area especially in the Finnish context. The study is based on multidisciplinary theoretical sources through which the framework of multiple linkages relevant to the commercialisation of sex is conceptualised. The sex trade functions through a web of intersecting linkages of a substantive, economic, organisational, temporal, spatial, cultural, technological, as well as of legislative and policy nature. This framework of linkages forms the basis for the analysis of the main empirical data, namely qualitative interviews with thirty key managers and professionals, who are responsible for the preparation and implementation of policies on commercial sex. In addition, the thesis addresses the policies and policy practices on the sex trade through the analysis of national and international policy instruments. In addition to analysing the processes of the commercialisation of sex and its effects, the study also discusses their further implications for organisational policy-making, research, and society more generally. The thesis thus seeks to contribute to practice, research and theory on gender, management and organisations.

Intraday Linkages across International Equity Markets

Utilizing concurrent 5-minute returns, the intraday dynamics and inter-market dependencies in international equity markets were investigated. A strong intraday cyclical autocorrelation structure in the volatility process was observed to be caused by the diurnal pattern. A major rise in contemporaneous cross correlation among European stock markets was also noticed to follow the opening of the New York Stock Exchange. Furthermore, the results indicated that the returns for UK and Germany responded to each other’s innovations, both in terms of the first and second moment dependencies. In contrast to earlier research, the US stock market did not cause significant volatility spillover to the European markets.

Anthraquinones from the Fungus Dermocybe sanguinea as Textile Dyes

This study is based on the multidiciplinary approach of using natural colorants as textile dyes. The author was interested in both the historical and traditional aspects of natural dyeing as well as the modern industrial applications of the pure natural compounds. In the study, the anthraquinone compounds were isolated as aglycones from the ectomycorrhizal fungus Dermocybe sanguinea. The endogenous beta-glucosidase of the fungus was used to catalyse the hydrolysis of the O-glycosyl linkage in emodin- and dermocybin-1-beta-D-glucopyranosides. The method, in which 10.45 kg of fresh fungi was starting material, yielded two fractions: 56.0 g of Fraction 1 (94% of the total amount of pigment,) consisting almost exclusively of the main pigments emodin and dermocybin, and 3.3 g of Fraction 2 (6%) consisting mainly of the anthraquinone carboxylic acids. The anthraquinone compounds in Fractions 1 and 2 were separated by one- and two-dimensional thin-layer-chromatography (TLC) using silica plates. 1D TLC showed that neither an acidic nor a basic solvent system alone separated completely all the anthraquinones isolated from D. sanguinea, in spite of the variation of the rations of the solvent components in the systems. Thus, a new 2D TLC technique was developed, applying n-pentanol-pyridine-methanol (6:4:3, v/v/v) and toluene-ethyl acetate-ethanol-formic acid (10:8:1:2, v/v/v/v) as eluents. Fifteen different anthraquinone derivatives were completely separated from one another. Emodin, physcion, endocrocin, dermolutein, dermorubin, 5-chlorodermorubin, emodin-1-beta-D-glucopyranoside, dermocybin-1-beta-D-glucopyranoside and dermocybin, and five new compounds, not earlier identified in D. sanguinea, 7-chloroemodin, 5,7-dichloroemodin, 5,7-dichloroendocrocin, 4-hydroxyaustrocorticone and austrocorticone, were separated and identified on the basis of their Rf-values, UV/Vis spectra and mass spectra. One substance remained unidentified, because of its very low concentration. The anthraquinones in Fractions 1 and 2 were preparatively separeted by liquid-liquid partition, with isopropylmethyl ketone and aqueous phosphate buffer as the solvent system. Advantage was taken of the principle of stepwise pH-gradient elution. The multiple liquid-liquid partition (MLLP) offered an excellent method for the preparative separation of compounds, which contain acidic groups such as the phenolic OH and COOH groups. Due to their strong aggregation properties, these compounds are, without derivatization, very difficult to separate on a preparative scale by chromatographic methods. By the MLLP method remarkable separations were achieved for the components in each mixture. Emodin and dermocybin were both obtained from Fraction 1 in a purity of at least 99%. Pure emodin and dermocybin were applied as mordant dyes to wool and polyamide and as disperse dyes to polyester and polyamide, using the high temperature (HT) technique. A mixture of dermorubin and 5-chlorodermorubin was applied as an acid dye to wool. In these experiments, synthetic dyes were used as references. Experiments were also performed using water extract of the air-dried fungi as dye liquor for wool and silk. The main colouring compounds in the crude water extract were emodin and dermocybin, which indicated that the O-glycosyl linkages in emodin- and dermocybin-1-beta-D-glucopyranosides were broken by the beta-glucosidase enzyme. Apparently, the hydrolysis occurred during the drying of the fungi and during the soaking of the dried fruit bodies overnight when preparing the dyebath. The colour of each dyed material was investigated in terms of the CIELAB L*, a* and b* values, and the colour fastness to light, washing and rubbing was tested according to the ISO standards. In the mordant dyeing experiments, emodin dyed wool and polyamide yellow and red, depending on the pH of the dyebath. Dermocybin gave purple and violet colours. The colour fastness of the mordant-dyed fabrics varied from good to moderate. The fastness properties of the natural anthraquinone carboxylic acids on wool were good, indicating the strength of the ionic bonds between the COO- groups of the dyes and the NH3+ groups of the fibres. In the disperse dyeing experiments, emodin dyed polyester bright yellow and dermocybin bright reddish-orange, and the fabrics showed excellent colour fastness. In contrast, emodin and dermocybin successfully dyed polyamide brownish-orange and wine-red, respectively, but with only moderate fastness. In industrial dyeing processes, natural anthraquinone aglycone mixtures dyed wool and silk well even at low concentrations of mordants, i.e. with 10% of the weight of the fibre (owf) of KAl(SO4)2 and 1 or 0.5% owf of other mordants. This study showed that purified natural anthraquinone compounds can produce bright hues with good colour-fastness properties in different textile materials. Natural anthraquinones have a significant potential for new dyeing techniques and will provide useful alternatives to synthetic dyes.

Palladin, a novel microfilament protein

Palladin is a novel actin microfilament associated protein, which together with myotilin and myopalladin forms a novel cytoskeletal IgC2 domain protein family. Whereas the expression of myotilin and myopalladin is limited mainly to striated muscle, palladin is widely expressed in both epithelial and mesenchymal tissues, including heart and the nervous system. Palladin has a complex genetic structure and it is expressed as several different sized and structured splice variants, which also display differences in their expression pattern and interactions. In muscle cells, all the family members localize to the sarcomeric Z-disc, and in non-muscle cells palladin also localizes to the stress-fiber-dense regions, lamellipodia, podosomes and focal adhesions. A common feature of this protein family is the binding to α-actinin, but other interactions are mostly unique to each member. Palladin has been shown to interact with several proteins, including VASP, profilin, Eps8, LASP-1 and LPP. Its domain structure, lack of enzymatic activity and multiple interactions define it as a molecular scaffolding protein, which links together proteins with different functional modalities into large complexes. Palladin has an important role in cytoskeletal regulation, particularly in stress fiber formation and stabilization. This assumption is supported by several experimental results. First, over-expression of palladin in non-muscle cells results in rapid reorganization of the actin cytoskeleton and formation of thick actin bundles. Second, the knock-down of palladin with anti-sense and siRNA techniques or knock-out by genetic methods leads to defective stress fiber formation. Furthermore, palladin is usually up-regulated in situations requiring a highly organized cytoskeleton, such as differentiation of dendritic cells, trophoblasts and myofibroblasts, and activation of astrocytes during glial scar formation. The protein family members have also direct disease linkages; myotilin missense mutations are the cause of LGMD1A and myofibrillar myopathy. Palladin mutations and polymorphisms, on the other hand, have been linked to hereditary pancreatic cancer and myocardial infarction, respectively. In this study we set out to characterize human palladin. We identified several palladin isoforms, studied their tissue distribution and sub-cellular localization. Four novel interaction partners were identified; ezrin, ArgBP2, SPIN90 and Src-kinase.The previously identified interaction between palladin and α-actinin was also characterized in detail. All the identified new binding partners are actin cytoskeleton associated proteins; ezrin links the plasma membrane to the cytoskeleton, ArgBP2 and SPIN90 localize, among other structures, to the lamellipodia and in cardiomyocytes to the Z-disc. Src is a transforming tyrosine kinase, which besides its role in oncogenesis has also important cytoskeletal associations. We also studied palladin in myofibroblasts, which are specialized cells involved in diverse physiological and pathological processes, such as wound healing and tissue fibrosis. We demonstrated that palladin is up-regulated during the differentiation of myofibroblasts in an isoform specific manner, and that this up-regulation is induced by TGF-β via activation of both the SMAD and MAPK signalling cascades. In summary, the results presented here describe the initial characterization of human palladin and offer a basis for further studies.

Livelihood, land use and environment interactions in the highlands of East Africa

This study aims at improving understanding of the interactions of livelihoods and the environment focusing on both socio-economic and biodiversity implications of land use change in the context of population pressure, global and local markets, climate change, cultural and regional historical factors in the highlands of East Africa. The study is based on three components (1) two extensive livelihood surveys, one on Mt. Kilimanjaro in Tanzania and the other in the Taita Hills of Kenya, (2) a land use change study of the southern slopes of Mt. Kilimanjaro focusing on land use trends between 1960s and 1980s and 1980s and 2000 and (3) a bird diversity study focusing on the potential impacts of the future land use change on birds in the main land use types on the slopes and the adjacent plains of Mt. Kilimanjaro. In addition, information on the highlands in Embu and the adjacent lowlands in Mbeere of Kenya are added to the discussion. Some general patterns of livelihood, land use and environment interactions can be found in the three sites. However, the linkages are very complex. Various external factors at different times in history have influenced most of the major turning points. Farmers continually make small adaptations to their farming practices, but the locally conceived alternatives are too few. Farmers lack specific information and knowledge on the most suitable crops, market opportunities and the quality requirements for growing the crops for markets. Population growth emerges as the most forceful driver of land use and environmental change. The higher altitudes have become extremely crowded with population densities in some areas higher than typical urban population densities. Natural vegetation has almost totally been replaced by farmland. Decreasing farm size due to population pressure is currently threatening the viability of whole farming systems. In addition, capital-poor intensification has lead to soil fertility depletion. Agricultural expansion to the agriculturally marginal lowlands has created a new and distinct group of farmers struggling constantly with climate variability causing frequent crop failures. Extensification to the fragile drylands is the major cause of fragmentation and loss of wildlife habitat. The linkages between livelihoods, land use and the environment generally point to degradation of the environment leading to reduced environmental services and ecosystem functions. There is no indication that the system is self-regulating in this respect. Positive interventions will be needed to maintain ecosystem integrity.

Use of ecological information in urban planning

Urbanization leads to irreversible land-use change, which has ecological consequences such as the loss and fragmentation of green areas, and structural and functional changes in terrestrial and aquatic ecosystems. These consequences diminish ecosystem services important for human populations living in urban areas. All this results in a conflict situation: how to simultaneously meet the needs of city growth and the principles of sustainable development, and especially conserve important green areas within and around built-up areas? Urban planners and decisionmakers have an important role in this, since they must use the ecological information mainly from species and biotope inventories and biodiversity impact assessments in determining the conservation values of green areas. The main aim of this thesis was to study the use of ecological information in the urban land-use planning and decisionmaking process in the Helsinki Metropolitan Area, Finland. At first, the literature on ecological-social systems linkages related to urban planning was reviewed. Based on the review, a theoretical and conceptual framework for the research on Finnish urban setting was adapted. Secondly, factors determining the importance and effectiveness of incorporation of ecological information into the urban planning process, and the challenges related to the use of ecological information were studied. Thirdly, the importance and use of Local Ecological Knowledge in urban planning were investigated. Then, factors determining the consideration of urban green areas and related ecological information in political land-use decisionmaking were studied. Finally, in a case study illustrating the above considerations, the importance of urban stream ecosystems in the land-use planning was investigated. This thesis demonstrated that although there are several challenges in using ecological information effectively, it is considered as an increasingly important part of the basic information used in urban planning and decisionmaking process. The basic determinants for this are the recent changes in environmental legislation, but also the increasing appreciation of green areas and their conservation values by all the stakeholders. In addition, Local Ecological Knowledge in its several forms can be a source of ecological information for planners if incorporated effectively into the process. This study also showed that rare or endangered species and biotopes, and related ecological information receive priority in the urban planning process and usually pass through the decisionmaking system. Furthermore, the stream Rekolanoja case indicates that planners and residents see the value of urban stream ecosystem as increasingly important for the local health and social values, such as recreation and stress relief.

Asteroid identification using statistical orbital inversion methods

An efficient and statistically robust solution for the identification of asteroids among numerous sets of astrometry is presented. In particular, numerical methods have been developed for the short-term identification of asteroids at discovery, and for the long-term identification of scarcely observed asteroids over apparitions, a task which has been lacking a robust method until now. The methods are based on the solid foundation of statistical orbital inversion properly taking into account the observational uncertainties, which allows for the detection of practically all correct identifications. Through the use of dimensionality-reduction techniques and efficient data structures, the exact methods have a loglinear, that is, O(nlog(n)), computational complexity, where n is the number of included observation sets. The methods developed are thus suitable for future large-scale surveys which anticipate a substantial increase in the astrometric data rate. Due to the discontinuous nature of asteroid astrometry, separate sets of astrometry must be linked to a common asteroid from the very first discovery detections onwards. The reason for the discontinuity in the observed positions is the rotation of the observer with the Earth as well as the motion of the asteroid and the observer about the Sun. Therefore, the aim of identification is to find a set of orbital elements that reproduce the observed positions with residuals similar to the inevitable observational uncertainty. Unless the astrometric observation sets are linked, the corresponding asteroid is eventually lost as the uncertainty of the predicted positions grows too large to allow successful follow-up. Whereas the presented identification theory and the numerical comparison algorithm are generally applicable, that is, also in fields other than astronomy (e.g., in the identification of space debris), the numerical methods developed for asteroid identification can immediately be applied to all objects on heliocentric orbits with negligible effects due to non-gravitational forces in the time frame of the analysis. The methods developed have been successfully applied to various identification problems. Simulations have shown that the methods developed are able to find virtually all correct linkages despite challenges such as numerous scarce observation sets, astrometric uncertainty, numerous objects confined to a limited region on the celestial sphere, long linking intervals, and substantial parallaxes. Tens of previously unknown main-belt asteroids have been identified with the short-term method in a preliminary study to locate asteroids among numerous unidentified sets of single-night astrometry of moving objects, and scarce astrometry obtained nearly simultaneously with Earth-based and space-based telescopes has been successfully linked despite a substantial parallax. Using the long-term method, thousands of realistic 3-linkages typically spanning several apparitions have so far been found among designated observation sets each spanning less than 48 hours.

The significance of brittle reaction layers in fusing of dental ceramics to titanium

This thesis comprises four intercomplementary parts that introduce new approaches to brittle reaction layers and mechanical compatibility of metalloceramic joints created when fusing dental ceramics to titanium. Several different methods including atomic layer deposition (ALD), sessile drop contact angle measurements, scanning acoustic microscopy (SAM), three-point bending (TPB, DIN 13 927 / ISO 9693), cross-section microscopy, scanning electron microscopy (SEM), and energy dispersive X-ray spectroscopy (EDS) were employed. The first part investigates the effects of TiO2 layer structure and thickness on the joint strength of the titanium-metalloceramic system. Samples with all tested TiO2 thicknesses displayed good ceramics adhesion to Ti, and uniform TPB results. The fracture mode was independent of oxide layer thickness and structure. Cracking occurred deeper inside titanium, in the oxygen-rich Ti[O]x solid solution surface layer. During dental ceramics firing TiO2 layers dissociate and joints become brittle with increased dissolution of oxygen into metallic Ti and consequent reduction in the metal plasticity. To accomplish an ideal metalloceramic joint this needs to be resolved. The second part introduces photoinduced superhydrophilicity of TiO2. Test samples with ALD deposited anatase TiO2 films were produced. Samples were irradiated with UV light to induce superhydrophilicity of the surfaces through a cascade leading to increased amount of surface hydroxyl groups. Superhydrophilicity (contact angle ~0˚) was achieved within 2 minutes of UV radiation. Partial recovery of the contact angle was observed during the first 10 minutes after UV exposure. Total recovery was not observed within 24h storage. Photoinduced ultrahydrophilicity can be used to enhance wettability of titanium surfaces, an important factor in dental ceramics veneering processes. The third part addresses interlayers designed to restrain oxygen dissolution into Ti during dental ceramics fusing. The main requirements for an ideal interlayer material are proposed. Based on these criteria and systematic exclusion of possible interlayer materials silver (Ag) interlayers were chosen. TPB results were significantly better in when 5 μm Ag interlayers were used compared to only Al2O3-blasted samples. In samples with these Ag interlayers multiple cracks occurred inside dental ceramics, none inside Ti structure. Ag interlayers of 5 μm on Al2O3-blasted samples can be efficiently used to retard formation of the brittle oxygen-rich Ti[O]x layer, thus enhancing metalloceramic joint integrity. The most brittle component in metalloceramic joints with 5 μm Ag interlayers was bulk dental ceramics instead of Ti[O]x. The fourth part investigates the importance of mechanical interlocking. According to the results, the significance of mechanical interlocking achieved by conventional surface treatments can be questioned as long as the formation of the brittle layers (mainly oxygen-rich Ti[O]x) cannot be sufficiently controlled. In summary in contrast to former impressions of thick titanium oxide layers this thesis clearly demonstrates diffusion of oxygen from sintering atmosphere and SiO2 to Ti structures during dental ceramics firing and the following formation of brittle Ti[O]x solid solution as the most important factors predisposing joints between Ti and SiO2-based dental ceramics to low strength. This among other predisposing factors such as residual stresses created by the coefficient of thermal expansion mismatch between dental ceramics and Ti frameworks can be avoided with Ag interlayers.

Ihmissalakuljetus ja ihmiskauppa Helsingin Sanomissa ja Dagens Nyheterissä

Human smuggling and trafficking in human beings are phenomena that are often represented as global and growing problems. Human smuggling means that a person is taken to a country illegally which means that smuggling does not exist without states. Trafficking in human beings by contrast means the exploitation of persons which makes it a human rights violation. The news coverage about both phenomena, especially about human trafficking, has grown rapidly during the last decade. However, there has not been research on the news coverage about phenomena in Finland and the news coverage on trafficking in human beings is little researched even in European countries. In this thesis I am comparing critically the newspaper content on the phenomena in Finland and in Sweden from the viewpoint of political and moral geography. Besides the contexts of the news, I paid attention to how identities in different scales, including the scale of the body, were represented in the news and how the boundaries between different identities were drawn in the news. As a methodology I used content analysis to classify the context of the news and discourse analysis to analyze how the different scales and boundaries between them were represented. The results address that in Finland especially the human smuggling is considered as a border issue and Finland´s location between East and West is emphasized, which points out that Finland´s location is a crucial part of the Finnish identity. In addition the linkages between human trafficking and prostitution are often debated in the news from different aspects. In Sweden meanwhile its´ political activeness in the fight against trafficking in human beings and international crime especially in the EU level are emphasized. Trafficking in human beings likewise prostitution according to Swedish law is seen as violence against women and the news are strongly against buying of sex as well. The states themselves, the state authorities and the EU are represented as active actors in both countries whereas international crime is represented as a threat and regions outside EU as chaotic. Additionally, illegal immigrants and the victims of trafficking are stigmatised. According to the results, the news coverage of both phenomena are used in constructing a more integrated national and European identity.

Consequences of Vertebral Fractures

Vertebral fractures occur due to forces applied to spinal structures. When the bone tissue is weakened, vertebral fractures can result from a minor trauma. Adult vertebral fractures are commonly considered to be an indication for osteoporosis. In children osteoporosis is a rare condition, and pediatric vertebral fractures are usually clearly trauma-related. The aims of this dissertation are to produce knowledge of the epidemiology of osteoporotic vertebral fractures and to analyse their association with total and cause-specific mortality, to find indicators with which to identify individuals who are at great risk of subsequent fractures, to study the incidence of pediatric vertebral fractures and need for their operative treatment and hospital care. The Mobile-Clinic and Mini-Finland Health surveys of the adult population were used as materials in this research. Record linkages to the Finnish Hospital Discharge Register and the Official Cause of Death register were used to study mortality and hospitalization in the same population group. These registers were also used to evaluate epidemiology, mortality, hospitalization and the need for operative management of pediatric vertebral fracture patients. The main findings and conclusions of the present dissertation are: 1. The presence of a thoracic vertebral fracture in adults is a significant predictor of cancer and respiratory mortality. In women, but not in men, vertebral fractures strongly predict mortality due to injuries. Most of these deaths in the study group were hip fracture related. 2. Severe thoracic vertebral fracture in adults was a strong predictor of a subsequent hip fracture, whereas mild or moderate fractures and the number of compressed vertebrae were much weaker predictors, 3. Pediatric spinal fractures were rare: The incidence was 66 per one million children per year. In younger children cervical spine was most often affected, whereas in older children fractures of the thoracic and lumbar spine were more common. Maturation of spinal structures seems to play a major role in the typical injury patterns in children. Thirty per cent of pediatric spinal fractures required surgical treatment. The current study focuses on consequences of vertebral fractures in general, without evaluating further the causation of the studied phenomena. Further studies are needed to clarify the mechanisms of association between vertebral fractures and specific causes of mortality. A severe vertebral fracture appears to indicate a substantial risk of a subsequent hip fracture. If such a fracture is identified from a chest radiograph, urgent clinical evaluation, treatment of osteoporosis and protective measures against falls are recommended.

Intraday Dynamics of International Equity Markets

The increased availability of high frequency data sets have led to important new insights in understanding of financial markets. The use of high frequency data is interesting and persuasive, since it can reveal new information that cannot be seen in lower data aggregation. This dissertation explores some of the many important issues connected with the use, analysis and application of high frequency data. These include the effects of intraday seasonal, the behaviour of time varying volatility, the information content of various market data, and the issue of inter market linkages utilizing high frequency 5 minute observations from major European and the U.S stock indices, namely DAX30 of Germany, CAC40 of France, SMI of Switzerland, FTSE100 of the UK and SP500 of the U.S. The first essay in the dissertation shows that there are remarkable similarities in the intraday behaviour of conditional volatility across European equity markets. Moreover, the U.S macroeconomic news announcements have significant cross border effect on both, European equity returns and volatilities. The second essay reports substantial intraday return and volatility linkages across European stock indices of the UK and Germany. This relationship appears virtually unchanged by the presence or absence of the U.S stock market. However, the return correlation among the U.K and German markets rises significantly following the U.S stock market opening, which could largely be described as a contemporaneous effect. The third essay sheds light on market microstructure issues in which traders and market makers learn from watching market data, and it is this learning process that leads to price adjustments. This study concludes that trading volume plays an important role in explaining international return and volatility transmissions. The examination concerning asymmetry reveals that the impact of the positive volume changes is larger on foreign stock market volatility than the negative changes. The fourth and the final essay documents number of regularities in the pattern of intraday return volatility, trading volume and bid-ask spreads. This study also reports a contemporaneous and positive relationship between the intraday return volatility, bid ask spread and unexpected trading volume. These results verify the role of trading volume and bid ask quotes as proxies for information arrival in producing contemporaneous and subsequent intraday return volatility. Moreover, asymmetric effect of trading volume on conditional volatility is also confirmed. Overall, this dissertation explores the role of information in explaining the intraday return and volatility dynamics in international stock markets. The process through which the information is incorporated in stock prices is central to all information-based models. The intraday data facilitates the investigation that how information gets incorporated into security prices as a result of the trading behavior of informed and uninformed traders. Thus high frequency data appears critical in enhancing our understanding of intraday behavior of various stock markets’ variables as it has important implications for market participants, regulators and academic researchers.

Modeling and Forecasting Implied Volatility: Implications for Trading, Pricing, and Risk Management

Modeling and forecasting of implied volatility (IV) is important to both practitioners and academics, especially in trading, pricing, hedging, and risk management activities, all of which require an accurate volatility. However, it has become challenging since the 1987 stock market crash, as implied volatilities (IVs) recovered from stock index options present two patterns: volatility smirk(skew) and volatility term-structure, if the two are examined at the same time, presents a rich implied volatility surface (IVS). This implies that the assumptions behind the Black-Scholes (1973) model do not hold empirically, as asset prices are mostly influenced by many underlying risk factors. This thesis, consists of four essays, is modeling and forecasting implied volatility in the presence of options markets’ empirical regularities. The first essay is modeling the dynamics IVS, it extends the Dumas, Fleming and Whaley (DFW) (1998) framework; for instance, using moneyness in the implied forward price and OTM put-call options on the FTSE100 index, a nonlinear optimization is used to estimate different models and thereby produce rich, smooth IVSs. Here, the constant-volatility model fails to explain the variations in the rich IVS. Next, it is found that three factors can explain about 69-88% of the variance in the IVS. Of this, on average, 56% is explained by the level factor, 15% by the term-structure factor, and the additional 7% by the jump-fear factor. The second essay proposes a quantile regression model for modeling contemporaneous asymmetric return-volatility relationship, which is the generalization of Hibbert et al. (2008) model. The results show strong negative asymmetric return-volatility relationship at various quantiles of IV distributions, it is monotonically increasing when moving from the median quantile to the uppermost quantile (i.e., 95%); therefore, OLS underestimates this relationship at upper quantiles. Additionally, the asymmetric relationship is more pronounced with the smirk (skew) adjusted volatility index measure in comparison to the old volatility index measure. Nonetheless, the volatility indices are ranked in terms of asymmetric volatility as follows: VIX, VSTOXX, VDAX, and VXN. The third essay examines the information content of the new-VDAX volatility index to forecast daily Value-at-Risk (VaR) estimates and compares its VaR forecasts with the forecasts of the Filtered Historical Simulation and RiskMetrics. All daily VaR models are then backtested from 1992-2009 using unconditional, independence, conditional coverage, and quadratic-score tests. It is found that the VDAX subsumes almost all information required for the volatility of daily VaR forecasts for a portfolio of the DAX30 index; implied-VaR models outperform all other VaR models. The fourth essay models the risk factors driving the swaption IVs. It is found that three factors can explain 94-97% of the variation in each of the EUR, USD, and GBP swaption IVs. There are significant linkages across factors, and bi-directional causality is at work between the factors implied by EUR and USD swaption IVs. Furthermore, the factors implied by EUR and USD IVs respond to each others’ shocks; however, surprisingly, GBP does not affect them. Second, the string market model calibration results show it can efficiently reproduce (or forecast) the volatility surface for each of the swaptions markets.

Customer Value of Website Communication in Business-to-business Relationships

During past years, we have witnessed the widespread use of websites in communication in business-to-business relationships. If developed appropriately, such communication can result in numerous positive implications for business relationships, amplifying the importance of designing website communication that meet customer needs. In doing that, an understanding of value of website communication for customers is crucial. The study develops a theoretical framework of customer value of website communication in business-to-business relationships. Theoretically, the study builds on the interaction approach to industrial marketing, different approaches to customer value and inter-organisational communication theory. The empirical part involves a case study with a seller and nine different customer companies in the elevator industry. The data collection encompasses interviews and observations of representatives from the customer companies, interviews with the seller and an analysis of various reports of the seller. The continuous iteration between the theory and the case study resulted in the integrated approach to customer value and in the holistic theoretical framework of customer value of website communication in business-to-business relationships. The framework incorporates and elicits meanings of different components of customer value: website communication characteristics that act as drivers of customer value, customer consequences – both benefits and sacrifices, customer end-states as the final goals that lead customer actions, and different types of linkages between these components. Compared to extant research on customer value, the study offers a more holistic framework of customer value that depicts its complexity and richness. In addition, it portrays customer value in the neglected context of website communication. The findings of the study can be used as tools in any analysis of customer value. They are also of relevance in designing appropriate website communication as well as in developing effective website communication strategies. Nataša Golik Klanac is associated with the Centre for Relationship Marketing and Service Management (CERS) at Hanken.

Urban ecosystem services at the plant-soil interface

Continuing urbanization is a crucial driver of land transformation, having widespread impacts on virtually all ecosystems. Terrestrial ecosystems, including disturbed ones, are dependent on soils, which provide a multitude of ecosystem services. As soils are always directly and/or indirectly impacted through land transformation, land cover change causes soil change. Knowledge of ecosystem properties and functions in soils is increasing in importance as humans continue to concentrate into already densely-populated areas. Urban soils often have hampered functioning due to various disturbances resulting from human activity. Innovative solutions are needed to bring the lacking ecosystem services and quality of life to these urban environments. For instance, the ecosystem services of the urban green infrastructure may be substantially improved through knowledge of their functional properties. In the research forming this thesis, the impacts of four plant species (Picea abies, Calluna vulgaris, Lotus corniculatus and Holcus lanatus) on belowground biota and regulatory ecosystem services were investigated in two different urban soil types. The retention of inorganic nitrogen and phosphorus in the plant-soil system, decomposition of plant litter, primary production, and the degradation of polycyclic aromatic hydrocarbons (PAHs) were examined in the field and under laboratory conditions. The main objective of the research was to determine whether the different plant species (representing traits with varying litter decomposability) will give rise to dissimilar urban belowground communities with differing ecological functions. Microbial activity as well as the abundance of nematodes and enchytraeid worm biomass was highest below the legume L. corniculatus. L. corniculatus and the grass H. lanatus, producing labile or intermediate quality litter, enhanced the proportion of bacteria in the soil rhizosphere, while the recalcitrant litter-producing shrub C. vulgaris and the conifer P. abies stimulated the growth of fungi. The loss of nitrogen from the plant-soil system was small for H. lanatus and the combination of C. vulgaris + P. abies, irrespective of their energy channel composition. These presumably nitrogen-conservative plant species effectively diminished the leaching losses from the plant-soil systems with all the plant traits present. The laboratory experiment revealed a difference in N allocation between the plant traits: C. vulgaris and P. abies sequestered significantly more N in aboveground shoots in comparison to L. corniculatus and H. Lanatus. Plant rhizosphere effects were less clear for phosphorus retention, litter decomposition and the degradation of PAH compounds. This may be due to the relatively short experimental durations, as the maturation of the plant-soil system is likely to take a considerably longer time. The empirical studies of this thesis demonstrated that the soil communities rapidly reflect changes in plant coverage, and this has consequences for the functionality of soils. The energy channel composition of soils can be manipulated through plants, which was also supported by the results of the separate meta-analysis conducted in this thesis. However, further research is needed to understand the linkages between the biological community properties and ecosystem services in strongly human-modified systems.