Performance of active portfolio management and the effect of stock market trend

Purpose of the study is to evaluate performance of active portfolio management and the effect of stock market trend on the performance. Theory of efficient markets states that market prices reflect all available information and that all investors share a common view of future price developments. This view gives little room for the success of active management, but the theory has been disputed – at least the level of efficiency. Behavioral finance has developed theories that identify irrational behavior patterns of investors. For example, investment decisions are not made independent of past market developments. These findings give reason to believe that also the performance of active portfolio management may depend on market developments. Performance of 16 Finnish equity funds is evaluated during the period of 2005 to 2011. In addition two sub periods are constructed, a bull market period and a bear market period. The sub periods are created by joining together the two bull market phases and the two bear market phases of the whole period. This allows for the comparison of the two different market states. Performance of the funds is measured with risk-adjusted performance by Modigliani and Modigliani (1997), abnormal return over the CAPM by Jensen (1968), and market timing by Henriksson and Merton (1981). The results suggested that in average the funds are not able to outperform the market portfolio. However, the underperformance was found to be lower than the management fees in average which suggests that portfolio managers are able to do successful investment decisions to some extent. The study revealed substantial dependence on the market trend for all of the measures. The risk-adjusted performance measure suggested that in bear markets active portfolio managers in average are able to beat the market portfolio but not in bull markets. Jensen´s alpha and the market timing model also showed striking differences between the two market states. The results of these two measures were, however, somewhat problematic and reliable conclusions about the performance could not be drawn.

Corporate Social Responsibility and Shipping Views of Baltic Sea Shipping Companies on the Benefits of Responsibility

The safety of shipping operations in the Baltic Sea is an extensively studied issue due to the density of traffic and the ecological sensitivity of the area. The focus has, however, mainly been on ship technology or on traffic control measures and the operative safety aspect of shipping is in a minor position in maritime safety studies and is lacking in terms of solutions. Self-regulatory and voluntary measures could be effective ways to improve the operational safety of shipping. Corporate social responsibility, or CSR, is one example of a voluntary measure that the shipping companies can take. CSR can enhance maritime safety and improve the shipping companies’ competitiveness. The aim of this study is to increase the knowledge of CSR in the maritime sector and study its applicability and benefits to the shipping companies. The research comprises of a theory part and a questionnaire study, which examine the significance of corporate social responsibility in shipping companies’ maritime safety and competitiveness. The aim of the questionnaire study is to find out how corporate social responsibility is implemented in the shipping companies. According to the literature review, responsible actions can produce financial and time costs, but due to these actions cost savings in the form of learning and increased efficiency can be achieved. Responsible actions can also produce concrete improvements and a reputation of responsibility that can lead to both cost savings and increase in the company’s income. CSR is recognised as having real business benefits in terms of attracting customers and high-quality employees. In shipping, CSR usually focuses on environmental issues. Environmental social responsibility in shipping is mainly motivated by the need to comply with existing and forthcoming regulation. Shipping companies engage in CSR to gain competitive advantage and to increase maritime safety. The social aspects of CSR take into account the well-being and skills of the employees, corporation and other stakeholders of the company. The questionnaire study revealed that the most common CSR measures in shipping companies are environmental measures, and that environmental concerns are considered to be the most important reason to engage in CSR. From the preliminary question about the concept of CSR it can also be seen that safety issues are commonly considered to be a part of CSR and safety gains are the second most important reason to engage in CSR. From the questionnaire, it can also be extrapolated that gaining a better reputation is one of the most important reasons to engage in CSR in the first place. For example, the main economic benefit was seen to be the increase of customer numbers as a result of a better reputation. Based on the study, it would seem that companies are starting to realise that they might gain competitive advantage and be favoured as shippers if they engage in sustainable, responsible operations and present themselves as “green”.

Syvää vai pelkästään tiheää : neuvostoliittolaisen ja venäläisen sotataidollisen ajattelun lähtökohdat, kehittyminen, soveltaminen käytäntöön ja nykytilanne. Näkökulmana 1920- ja 1930-luvun syvän taistelun ja operaation opit

Sosialistisen vallankumouksen jälkeen Neuvosto-Venäjän oli monien muiden kysymysten ohella ratkaistava sosialismin saavutusten puolustaminen. Aluksi ratkaisuksi suunniteltiin vapaaehtoisuuteen perustuvaa punakaartia, mutta riittävän miesvahvuuden turvaamiseksi päädyttiin yleiseen asevelvollisuuteen. Pian Venäjän sisällissodan jälkeen sotataidon suunta painottui enemmän vanhan armeijan asiantuntijoiden näkemysten kuin vallankumoussankarien kokemusten mukaiseksi, vaikka Frunzen puna-armeijalle kirjoittama doktriini perustui luokkataisteluun ja korosti sisällissodassa hyväksi koettua operatiivista liikkuvuutta. Neuvostoliiton ja Venäjän sotataidon perustana on Pietari I:n aloittama länsimainen suuntaus, jota kuitenkin täydentävät vahvat kansalliset piirteet. Venäläisen sotataidon henkisenä isänä voidaan hyvällä syyllä pitää Aleksandr Suvorovia, jonka opetukset näkyvät tekstilainausten lisäksi myös periaatteissa ja sotilaskasvatuksessa. Napoleonin sotien jälkeen perustettu Keisarillinen yleisesikunta-akatemia loi Venäjälle sotatieteellisen tutkimuksen ja opetuksen. Sotatieteen mahdollisuuksia ei 1800-luvun Venäjällä osattu täysin hyödyntää. Aseistuksen kasvavan tehon merkitystä vähättelevä asenne johti sotataidon taantumisen ja katastrofiin Venäjän–Japanin sodassa. Sen kokemuksia analysoidessaan Aleksandr Neznamov kehitti edelleen saksalaista operaation käsitettä ja loi perustan Neuvostoliitossa 1920-luvulla kehitetylle operaatiotaidolle. Neuvostoliittolaisen sotataidon päämääränä oli kehittää taktinen ja operatiivinen ratkaisu aseistuksen tehon kasvun aikaansaamaan puolustuksen ylivoimaisuuteen. Ratkaisussa hyödynnettiin brittien kokemuksia ja tutkimusta. Neuvostoliittolainen taktiikka ja operaatiotaito eivät kuitenkaan olleet brittiläisen mekanisoidun sodankäynnin tai saksalaisen salamasodan itäinen kopioita vaan itsenäisiin ratkaisuihin pohjautuvia. Syvän taistelun ja operaation teoriaa kokeiltiin harjoituksissa, ja sitä kehitettiin Stalinin vuoden 1937 puhdistuksiin saakka. Toisen maailmansodan taisteluissa puna-armeija sovelsi alkuvaiheen katastrofin jälkeen syvän taistelun ja syvän operaation oppeja. Komentajien ja joukkojen taito ei riittänyt teorian vaatimusten mukaiseen toimintaan, siksi syväksi aiotusta taistelusta tuli ajoittain ainoastaan tiheää. Suuren isänmaallisen sodan kokemusten perusteella neuvostoliittolainen sotatiede kehitti yleisjoukkojen taistelun periaatteet, jotka ovat säilyneet muuttumattomina nykypäivään saakka. Kylmän sodan aikakaudella ydin- ja tavanomaisen aseistuksen merkitys sodan ja taistelun kuvassa vaihteli. Lännen sotataidon ja aseteknologian kehitys pakotti Neuvostoliiton siirtymään 1980-luvulla sotilaallisessa ajattelussaan hyökkäyksestä puolustukseen. Neuvostoliiton hajoamisen jälkeen Venäjän sotilaallisen turvallisuuden takaajana on ydinaseistus. Yhdysvaltain tavanomainen ilma-avaruushyökkäyskyky vaatii Venäjää kehittämään torjuntajärjestelmiä. Tavanomaisten joukkojen rakentamisessa Venäjä seuraa tarkasti läntisen sotataidon kehittymistä, mutta pitäytyy omaperäisiin ratkaisuihin, joiden kehittämisessä sen vahvalla sotatieteellisellä järjestelmällä ja dialektisen materialismin metodilla on edelleen olennaisen tärkeä merkitys.

Polysulfidiprosessin vaikutukset höyrynkulutukseen sulfaattisellutehtaassa

Diplomityön tavoitteena on kartoittaa höyrynkulutuksen merkittävimmät muutokset sellutehtaalla siirryttäessä sulfaattimassan valmistuksesta polysulfidiselluprosessiin. Työssä esitellään sulfaattisellun valmistusprosessi ja polysulfidin vaatimat muutokset selluprosessissa erityisesti höyrynkulutuksen kannalta. Sellutehtaan höyrynkulutusta ja sen mahdollisia sekä todennettuja muutoksia tarkastellaan suhteessa tehtaan selluntuotantoon. Diplomityössä analysoidaan muutoksiin johtaneita syitä ja erityisesti peilataan niitä ennalta odotettuihin muutoksiin, joita kandidaatintyö ”Polysulfidiprosessi sulfaattisellutehtaassa” (Szepaniak 2014) esitti kirjallisuuden pohjalta. Tutkimus tehdään tutustuen dokumenttilähteisiin sekä erityisesti hankkimalla lisätietoa ja käytännön näkemystä asiantuntijahaastatteluista. Työssä käytetään esimerkkinä tyypillistä modernia sellutehdasta, jonka perusteella tarkasteltavat osaprosessit ovat valikoituneet. Tutkimustulosten perusteella esitetään jatkotutkimus- ja kehityskohteita. Sulfaattiprosessiin tehtävät muutokset käsittävät keittolipeän muuttamisen polysulfidipitoiseksi, polysulfidin valmistusprosessin (MOXY) sekä keiton muuttamisen siten, että polysulfidin vaikutus voidaan maksimoida. Polysulfidiprosessi vaikuttaa merkittävästi lipeäkiertoon ja keittämöön. Keittämön höyrynkulutus kasvaa, haihduttamon kuorma vähenee ja soodakattilan lämmöntuotanto heikkenee. Muilla osastoilla ominaishöyrynkulutuksen muutokset ovat tilastollisesti merkityksettömiä. Höyrynkulutuksella on huomattava merkitys modernin sellutehtaan tuotanto- ja kustannustehokkuuteen, sillä säästetyllä ylijäämähöyryllä voidaan tuottaa myyntisähköä. Uusiutuvan energian tuottajana ja ympäristövastuullisena toimijana sellutehtaiden on järkevää pyrkiä vähentämään omaa höyrynkulutustaan ja lisäämään sitä kautta sähköntuotantoaan.

Poliisin salaiset tiedonhankintakeinot ja yksityiselämän suoja

Tutkimuksessa selvitetään ensinnäkin, mitä vaatimuksia yksityiselämän suoja osana perusoikeusjärjestelmää asettaa poliisin salaisia tiedonhankintakeinoja koskevalle lainsäätämiselle. Tutkimuksessa selvitetään lisäksi, miten nykyinen lainsäädäntö vastaa yksityiselämän suojasta seuraaviin vaatimuksiin, ja miten lainsäädäntöä tulisi mahdollisesti kehittää, jotta se paremmin vastaisi näihin vaatimuksiin. Perus- ja ihmisoikeuksien merkitys on lisääntynyt myös lain soveltamisen osalta, ja tästä syystä tutkimuksessa selvitetään, mitä vaatimuksia perusoikeusjärjestelmä asettaa salaisia tiedonhankintakeinoja koskevalle lain soveltamiselle. Tutkimuksen kohteena on pakkokeinolain (806/2011) 10 luvussa säädetyt keinot, joita käytetään rikosten selvittämiseen sekä poliisilain (872/2011) 5 luvussa säädetyt keinot, joita käytetään rikosten estämiseen ja paljastamiseen. Tässä tutkimuksessa perusoikeusjärjestelmän kokonaisuuden perusteella määrittyy se, millä ehdoilla ja missä laajuudessa salaisten tiedonhankintakeinojen käyttö on mahdollista. Tutkimuksessa selviää, että salaisia tiedonhankintakeinoja koskevaa sääntelyä tarvitaan nimenomaisesti tietyistä asiakokonaisuuksista. Kun tiedonhankintakeinojen käyttöön liittyviä intressejä pyritään sovittamaan yhteen, pelkkä punninta ei ole riittävää, vaan tärkeää on havaita, mitkä konkreettisemmat tekijät vaikuttavat ratkaisun tekemiseen lainsäätämisessä ja lain soveltamisessa. Ihmisarvon loukkaamattomuutta kunnioittavassa oikeusvaltiossa sääntelylle asettuu myös tiettyjä ehdottomia rajoja. Tutkimuksessa selviää myös, että tutkimustietoa eri tiedonhankintakeinojen tehokkuudesta tulisi saada lisää, jotta voidaan paremmin arvioida eri keinojen oikeasuhtaisuutta. Joidenkin tiedonhankintakeinojen edellytykset on muotoiltu niin, että on kyseenalaista, toteutuvatko luottamuksellisen viestin salaisuutta koskevan lakivarauksen vaatimukset. Tulisi myös pohtia, tarvitaanko ainakin joidenkin keinojen osalta hankittujen tietojen käsittelemistä ja hävittämistä valvomaan jokin poliisin nähden ulkopuolinen taho, jotta yksilön oikeusturva voitaisiin turvata paremmin. Jatkossa tulisi edelleen kiinnittää huomiota myös siihen, että tiedonhankintakeinoja koskevien lupapäätösten ja -hakemusten perustelut ovat riittävät. Eduskunnan oikeusasiamiehen suorittama valvonta on ollut merkittävää yksilön oikeusturvan toteutumisen kannalta. Vaikuttaa kuitenkin siltä, että erillisen valvontaelimen perustaminen olisi tärkeää, jotta voitaisiin varmistaa tiedonhankintakeinojen riittävän perusteellinen valvonta.

Lisenssien hinnoittelupäätösten tärkeys ohjelmistoliiketoiminnassa

Tavoite on selvittää hinnoittelupäätöksien noudattamista ohjelmistoliiketoimintaa harjoittavassa yrityksessä. Lisäksi syitä noudattamiseen ja noudattamatta jättämiseen sekä asiakkaiden hinnoittelutoiveisiin selvitettiin. Teoriassa esitellään kolmea hinnoittelumallia, kuinka näitä malleja käytetään käytännössä? Teoriaosuudessa käsitellään hintaa, hinnoittelua, hinnoittelumalleja ja ohjelmistoliiketoiminnan piirteitä. Empiirisessä osassa tehdään laadullista tutkimusta henkilökohtaisilla puolistrukturoiduilla haastatteluilla, joista kerätään tarjousten kanssa tutkimuksen aineisto. Tutkimusmateriaalin pohjalta vastataan tutkimuskysymyksiin. Vaikka käytännöt olisivat valideja, mutta mikäli hintoja ei nähdä järkevinä, käytännöistä on joustettava. Kohdetuotteilla pitäisi myös olla yhtäläiset hinnoittelumallit. Pääsyyksi käytännöistä joustamiseen nähtiin kohdeasiakkaan olevan avainasiakas tai kilpailijan tarjouksen voittaminen.

Social entrepreneurship – Believe in it or not!

The practice of social entrepreneurship already exists for a long time but the concept is quite new and has more recently raised a growing interest among academics. However, the majority of researches and considerations about the subject have taken a strong positive concern by omitting some sort of a critical reflection. The idea of this study is to consider the gap between the very optimistic and the more precautious concerns about social entrepreneurship. It means presenting the advantages and downsides connected to the topic in the business, public and third sector. The aim is to help the reader building his/her own belief on social entrepreneurship by considering the positive and negative sides of social entrepreneurship. Hence, the research is intended to take a critical step and aims to answer to the following research questions:  Shall we believe in social entrepreneurship?  What are the reasons for believing or not in social entrepreneurship taking into account the advantages and possible risks of it in the business, public, and third sector? The theoretical framework consists of the comparison between the promising and precautious sides about social entrepreneurship for private, public and non-governmental organizations including the actors or participants inside these sectors. The empirical part is conducted using a qualitative method. Personal interviews of experts in the fields of business, public and third sectors were handled. The purpose of this approach is to compare the critics in theory with the experience of persons dealing with social entrepreneurship. The results from the interviews revealed that in general, reasons for believing in social entrepreneurship prevail over critics about the subject. Social entrepreneurship may not yet represent a full performing business. Concerns for weakening the public power and putting aside the interests of communities in need may exist too. Furthermore, naïve and extra liberal ways of thinking or doing can lead to practices going in opposition with initial social objectives. Nevertheless, problems about social entrepreneurship would be mainly due to the young age of the movement. Time and experience would give better foundations and results to social entrepreneurs. Critics about social entrepreneurship could also easily be done to any sorts of business. Overall, the positive considerations of social entrepreneurship with skillful, motivated and responsible actors could represent some useful tools for enterprises, governments and charities. Some tools among many other possibilities to help people in need.

The evolution ofRussian power industry from monopoly to market operation

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Using tools to help cost estimating and pricing: examination of costing model's and cost breakdown's workability and their capability to cooperative work

Tämä diplomityö käsittelee työkaluja, jotka on suunniteltu kustannusten ennakointiin ja hinnan asetantaan. Aluksi on käyty läpi perinteisen ja toimintoperusteisen kustannuslaskennan perusteita. Näiden menetelmien välisiä eroja on tarkasteltu ja toimintoperusteisen kustannuslaskennan paremmin sopivuus nykypäivän yrityksille on perusteltu. Toisena käsitellään hinnoittelu. Hinnan merkitys, hinnoittelumenetelmät ja päätös lopullisesta hinnasta on käyty läpi. Hinnoittelun jälkeen esitellään kustannusjärjestelmät ja kustannusten arviointi. Nämä asiat todistavat, että tarkat kustannusarviot ovat elintärkeitä yritykselle. Tuotteen kustannusarviointi, hinnan asetanta ja tarjoaminen ovat erittäin merkityksellisiä asioita ottaen huomioon koko projektin elinkaaren ja tulevat tuotot. Nykyään on yleistä käyttää työkaluja kustannusarvioinnissa ja joskus myös hinnoittelussa. Työkalujen luotettavuus on tiedettävä, ennenkuin työkalut otetaan käyttöön. Myös työkalujen käyttäjät täytyy perehdyttää hyvin. Muuten yritys todennäköisesti kohtaa odottamattomia ja epämiellyttäviä yllätyksiä.

Introducing Basic Systematic Requirements Engineering Practices in Small Organizations with an Easy to Adopt Method

Requirements-relatedissues have been found the third most important risk factor in software projects and as the biggest reason for software project failures. This is not a surprise since; requirements engineering (RE) practices have been reported deficient inmore than 75% of all; enterprises. A problem analysis on small and low maturitysoftware organizations revealed two; central reasons for not starting process improvement efforts: lack of resources and uncertainty; about process improvementeffort paybacks.; In the constructive part of the study a basic RE method, BaRE, was developed to provide an; easy to adopt way to introduce basic systematic RE practices in small and low maturity; organizations. Based on diffusion of innovations literature, thirteen desirable characteristics; were identified for the solution and the method was implemented in five key components:; requirements document template, requirements development practices, requirements; management practices, tool support for requirements management, and training.; The empirical evaluation of the BaRE method was conducted in three industrial case studies. In; this evaluation, two companies established a completely new RE infrastructure following the; suggested practices while the third company conducted continued requirements document; template development based on the provided template and used it extensively in practice. The; real benefits of the adoption of the method were visible in the companies in four to six months; from the start of the evaluation project, and the two small companies in the project completed; their improvement efforts with an input equal to about one person month. The collected dataon; the case studies indicates that the companies implemented new practices with little adaptations; and little effort. Thus it can be concluded that the constructed BaRE method is indeed easy to; adopt and it can help introduce basic systematic RE practices in small organizations.

Methods to test gas tightness of packages

One of the primary goals for food packages is to protect food against harmful environment, especially oxygen and moisture. The gas transmission rate is the total gas transport through the package, both by permeation through the package material and by leakage through pinholes and cracks. The shelf life of a product can be extended, if the food is stored in a gas tight package. Thus there is a need to test gas tightness of packages. There are several tightness testing methods, and they can be broadly divided into destructive and nondestructive methods. One of the most sensitive methods to detect leaks is by using a non destructive tracer gas technique. Carbon dioxide, helium and hydrogen are the most commonly used tracer gases. Hydrogen is the lightest and the smallest of all gases, which allows it to escape rapidly from the leak areas. The low background concentration of H2 in air (0.5 ppm) enables sensitive leak detection. With a hydrogen leak detector it is also possible to locate leaks. That is not possible with many other tightness testing methods. The experimental work has been focused on investigating the factors which affect the measurement results with the H2leak detector. Also reasons for false results were searched to avoid them in upcoming measurements. From the results of these experiments, the appropriate measurement practice was created in order to have correct and repeatable results. The most important thing for good measurement results is to keep the probe of the detector tightly against the leak. Because of its high diffusion rate, the HZ concentration decreases quickly if holding the probe further away from the leak area and thus the measured H2 leaks would be incorrect and small leaks could be undetected. In the experimental part hydrogen, oxygen and water vapour transmissions through laser beam reference holes (diameters 1 100 μm) were also measured and compared. With the H2 leak detector it was possible to detect even a leakage through 1 μm (diameter) within a few seconds. Water vapour did not penetrate even the largest reference hole (100 μm), even at tropical conditions (38 °C, 90 % RH), whereas some O2 transmission occurred through the reference holes larger than 5 μm. Thus water vapour transmission does not have a significant effect on food deterioration, if the diameter of the leak is less than 100 μm, but small leaks (5 100 μm) are more harmful for the food products, which are sensitive to oxidation.

Financial and Environmental Impacts of a Dry Port to Facilitate Competitiveness of Two Major Transit Seaports of Finland

Environmental problems and issues have received more and more attention during the last decades. Reasons for this are different increased external costs such as congestion, CO2 emission, noise and accident costs. Transportation sector is the only sector with increasing external costs. The EU will increase its attention in decreasing the external costs of transport. Aim of this research was to find out if a dry port solution could decrease costs of transport, especially external costs. Dry port concept is an intermodal transport system, where inland transport between port and dry port is performed by rail transport instead of traditional road transport. In addition, dry ports offer similar services as ports. Research is conducted by performing a literature review about dry port concept and costs of transport, especially external costs of transport. Financial and environmental impacts of the dry port concept are studied by comparing costs of road and rail transport by cost accounting and with a simulation model. Location of dry port is researched with gravitational models. Results of the literature review are that rail transport is environmentally friendlier mode of transport than road transport. Cost model and simulation model show that if only costs of freight movement are considered, rail transport is more inexpensive transport mode than road transport in terms of internal and external costs. Because of that dry port concept could decrease costs of transport, especially external costs. Results of gravitational models are that city of Kouvola is in a good position to be a dry port. Russian transit traffic through Finland improves location of Kouvola to be a dry port.

From Fluid Dynamics to Human Psychology.What Drives Financial Markets Towards Extreme Events

For decades researchers have been trying to build models that would help understand price performance in financial markets and, therefore, to be able to forecast future prices. However, any econometric approaches have notoriously failed in predicting extreme events in markets. At the end of 20th century, market specialists started to admit that the reasons for economy meltdowns may originate as much in rational actions of traders as in human psychology. The latter forces have been described as trading biases, also known as animal spirits. This study aims at expressing in mathematical form some of the basic trading biases as well as the idea of market momentum and, therefore, reconstructing the dynamics of prices in financial markets. It is proposed through a novel family of models originating in population and fluid dynamics, applied to an electricity spot price time series. The main goal of this work is to investigate via numerical solutions how well theequations succeed in reproducing the real market time series properties, especially those that seemingly contradict standard assumptions of neoclassical economic theory, in particular the Efficient Market Hypothesis. The results show that the proposed model is able to generate price realizations that closely reproduce the behaviour and statistics of the original electricity spot price. That is achieved in all price levels, from small and medium-range variations to price spikes. The latter were generated from price dynamics and market momentum, without superimposing jump processes in the model. In the light of the presented results, it seems that the latest assumptions about human psychology and market momentum ruling market dynamics may be true. Therefore, other commodity markets should be analyzed with this model as well.

First dice your dill – new methods and techniques in sample handling

This book is dedicated to celebrate the 60th birthday of Professor Rainer Huopalahti. Professor Rainer “Repe” Huopalahti has had, and in fact is still enjoying a distinguished career in the analysis of food and food related flavor compounds. One will find it hard to make any progress in this particular field without a valid and innovative sample handling technique and this is a field in which Professor Huopalahti has made great contributions. The title and the front cover of this book honors Professor Huopahti’s early steps in science. His PhD thesis which was published on 1985 is entitled “Composition and content of aroma compounds in the dill herb, Anethum graveolens L., affected by different factors”. At that time, the thesis introduced new technology being applied to sample handling and analysis of flavoring compounds of dill. Sample handling is an essential task that in just about every analysis. If one is working with minor compounds in a sample or trying to detect trace levels of the analytes, one of the aims of sample handling may be to increase the sensitivity of the analytical method. On the other hand, if one is working with a challenging matrix such as the kind found in biological samples, one of the aims is to increase the selectivity. However, quite often the aim is to increase both the selectivity and the sensitivity. This book provides good and representative examples about the necessity of valid sample handling and the role of the sample handling in the analytical method. The contributors of the book are leading Finnish scientists on the field of organic instrumental analytical chemistry. Some of them are also Repe’ s personal friends and former students from the University of Turku, Department of Biochemistry and Food Chemistry. Importantly, the authors all know Repe in one way or another and are well aware of his achievements on the field of analytical chemistry. The editorial team had a great time during the planning phase and during the “hard work editorial phase” of the book. For example, we came up with many ideas on how to publish the book. After many long discussions, we decided to have a limited edition as an “old school hard cover book” – and to acknowledge more modern ways of disseminating knowledge by publishing an internet version of the book on the webpages of the University of Turku. Downloading the book from the webpage for personal use is free of charge. We believe and hope that the book will be read with great interest by scientists working in the fascinating field of organic instrumental analytical chemistry. We decided to publish our book in English for two main reasons. First, we believe that in the near future, more and more teaching in Finnish Universities will be delivered in English. To facilitate this process and encourage students to develop good language skills, it was decided to be published the book in English. Secondly, we believe that the book will also interest scientists outside Finland – particularly in the other member states of the European Union. The editorial team thanks all the authors for their willingness to contribute to this book – and to adhere to the very strict schedule. We also want to thank the various individuals and enterprises who financially supported the book project. Without that support, it would not have been possible to publish the hardcover book.

Subjectivity in the valuation : Case study on the Finnish biotechnology industry

The thesis combines valuation and behavioral economics literature, which is not common among the Finnish management accounting research. Furthermore, the valuation is studied in biotechnology context and those type of studies are rather rare as well. The thesis studies the valuation in the Finnish biotechnology industry. The concepts of behavioral finance are employed in the empirical part of the study to explore decision-makers’ behavior in valuation processes. The main interest of this study is to explore how subjectivity of a decision-maker affects the valuation in the biotechnology industry. The valuation is studied from two perspectives. First, what is the best valuation model for biotechnology companies suggested by the valuation literature? Second, how the valuation in biotechnology industry is done in practice and how the decision-makers subjectivity affects the valuation? The literature review aims at seeking the best valuation model. The real options were found to be the most suitable valuation model for biotechnology companies, especially in the early stages of product development. The real option’s ability to take the value of the inherent options into account results in theoretically most correct valuations. The only disadvantage is the model’s complexity when compared to other models, such as discounted cash flow models. The empirical part of the study consists of a case study, which examines the valuation practices of the Finnish biotechnology companies. When it comes to the valuation models used in practice, it was found that the companies were using rather simple valuation models, which was due to two reasons. First, the interviewees did not believe in the valuation models and second, they were familiar neither with the most sophisticated models nor with all the theoretical aspects of the models they were using. The material for the study was collected with theme interviews. Four CEO’s of highly successful Finnish biotechnology companies. Strong signs of the decision-makers’ subjectivity in valuation were observed. Most obvious were the signs of framing. Furthermore, herding, excessive optimism, and overconfidence were present. All the behavioral concepts observed most likely have a severe effect on the valuation. As a result, the valuation can easily become overly optimistic, which leads to overvalued investments and to continuation of already unprofitable projects. Framing had the strongest evidence. If the product being valued is framed successfully, the risk of overvaluation is high, thus a strong belief can justify almost any value.