Better cross hedges with composite hedging? Hedging equity portfolios using financial and commodity futures

Unless a direct hedge is available, cross hedging must be used. In such circumstances portfolio theory implies that a composite hedge (the use of two or more hedging instruments to hedge a single spot position) will be beneficial. The study and use of composite hedging has been neglected; possibly because it requires the estimation of two or more hedge ratios. This paper demonstrates a statistically significant increase in out-of-sample effectiveness from the composite hedging of the Amex Oil Index using S&P500 and New York Mercantile Exchange crude oil futures. This conclusion is robust to the technique used to estimate the hedge ratios, and to allowance for transactions costs, dividends and the maturity of the futures contracts.

Towards the "cult of the equity"? Insurance companies and the interwar capital market

This article examines the ways in which insurance companies modified their investment policies during the interwar years, arguing that this period marked the start of the transition from ‘traditional’ to ‘modern’ investment practice. Economic and financial conditions raised considerable doubts regarding the suitability of traditional insurance investments, while competitive conditions forced insurance offices to seek higher-yielding assets. These pressures led to a considerable increase in the proportion of new investment devoted to corporate securities, including ordinary shares. Meanwhile new insurance investment philosophies began to be advocated, which accorded both legitimacy and importance to the role of ordinary shares in insurance portfolios.

Children with Special Educational Needs as film makers: Using digital video to support Understandings of Narrative

The literature has identified issues around transitions among phases for all pupils (Cocklin, 1999) including pupils with special educational needs (SEN) (Morgan 1999, Maras and Aveling 2006). These issues include pupils’ uncertainties and worries about building size and spatial orientation, exposure to a range of teaching styles, relationships with peers and older pupils as well as parents’ difficulties in establishing effective communications with prospective secondary schools. Research has also identified that interventions to facilitate these educational transitions should consider managerial support, social and personal familiarisation with the new setting as well as personalised learning strategies (BECTA 2004). However, the role that digital technologies can play in supporting these strategies or facilitating the role of the professionals such as SENCos and heads of departments involved in supporting effective transitions for pupils with SEN has not been widely discussed. Uses of ICT include passing references of student-produced media presentations (Higgins 1993) and use of photographs of activities attached to a timetable to support familiarisation with the secondary curriculum for pupils with autism (Cumine et al. 1998).

Inequality of educational opportunity in India: changes over time and across states

This paper documents the extent of inequality of educational opportunity in India spanning the period 1983–2004 using National Sample Surveys. We build on recent developments in the literature that have operationalized concepts of inequality of opportunity theory and construct several indices of inequality of educational opportunity for an adult sample. Kerala stands out as the least opportunity-unequal state. Rajasthan, Gujarat, and Uttar Pradesh experienced large-scale falls in the ranking of inequality of opportunities. By contrast, West Bengal and Orissa made significant progress in reducing inequality of opportunity. We also examine the links between progress toward equality of opportunity and a selection of pro-poor policies.

Poisoning the mind: Arsenic contamination of drinking water wells and children's educational achievement in rural Bangladesh

Bangladesh has experienced the largest mass poisoning of a population in history owing to contamination of groundwater with naturally occurring inorganic arsenic. Prolonged drinking of such water risks development of diseases and therefore has implications for children's cognitive and psychological development. This study examines the effect of arsenic contamination of tubewells, the primary source of drinking water at home, on the learning outcome of school-going children in rural Bangladesh using recent nationally representative data on secondary school children. We unambiguously find a negative and statistically significant correlation between mathematics scores and arsenic-contaminated drinking tubewells at home, net of the child's socio-economic status, parental background and school specific unobserved correlates of learning. Similar correlations are found for an alternative measure of student achievement and subjective well-being (i.e. self-reported measure of life satisfaction), of the student. We conclude by discussing the policy implication of our findings in the context of the current debate over the adverse effect of arsenic poisoning on children.

Can company-fund manager meetings convey informational benefits? Exploring the rationalisation of equity investment decision making by UK fund managers

Conventional economic theory, applied to information released by listed companies, equates ‘useful’ with ‘price-sensitive’. Stock exchange rules accordingly prohibit the selec- tive, private communication of price-sensitive information. Yet, even in the absence of such communication, UK equity fund managers routinely meet privately with the senior execu- tives of the companies in which they invest. Moreover, they consider these brief, formal and formulaic meetings to be their most important sources of investment information. In this paper we ask how that can be. Drawing on interview and observation data with fund managers and CFOs, we find evidence for three, non-mutually exclusive explanations: that the characterisation of information in conventional economic theory is too restricted, that fund managers fail to act with the rationality that conventional economic theory assumes, and/or that the primary value of the meetings for fund managers is not related to their investment decision making but to the claims of superior knowledge made to clients in marketing their active fund management expertise. Our findings suggest a disconnect between economic theory and economic policy based on that theory, as well as a corre- sponding limitation in research studies that test information-usefulness by assuming it to be synonymous with price-sensitivity. We draw implications for further research into the role of tacit knowledge in equity investment decision-making, and also into the effects of the principal–agent relationship between fund managers and their clients.

Commercial real estate and equity market bubbles: are they contagious to REITs?

This paper uses a regime-switching approach to determine whether prices in the US stock, direct real estate and indirect real estate markets are driven by the presence of speculative bubbles. The results show significant evidence of the existence of periodically partially collapsing speculative bubbles in all three markets. A multivariate bubble model is then developed and implemented to evaluate whether the stock and real estate bubbles spill over into REITs. The underlying stock market bubble is found to be a stronger influence on the securitised real estate market bubble than that of the property market. Furthermore, the findings suggest a transmission of speculative bubbles from the direct real estate to the stock market, although this link is not present for the returns themselves.

Training pharmacists to deliver a complex information technology intervention (PINCER) using the principles of educational outreach and root cause analysis

Objective: To describe the training undertaken by pharmacists employed in a pharmacist-led information technology-based intervention study to reduce medication errors in primary care (PINCER Trial), evaluate pharmacists’ assessment of the training, and the time implications of undertaking the training. Methods: Six pharmacists received training, which included training on root cause analysis and educational outreach, to enable them to deliver the PINCER Trial intervention. This was evaluated using self-report questionnaires at the end of each training session. The time taken to complete each session was recorded. Data from the evaluation forms were entered onto a Microsoft Excel spreadsheet, independently checked and the summary of results further verified. Frequencies were calculated for responses to the three-point Likert scale questions. Free-text comments from the evaluation forms and pharmacists’ diaries were analysed thematically. Key findings: All six pharmacists received 22 hours of training over five sessions. In four out of the five sessions, the pharmacists who completed an evaluation form (27 out of 30 were completed) stated they were satisfied or very satisfied with the various elements of the training package. Analysis of free-text comments and the pharmacists’ diaries showed that the principles of root cause analysis and educational outreach were viewed as useful tools to help pharmacists conduct pharmaceutical interventions in both the study and other pharmacy roles that they undertook. The opportunity to undertake role play was a valuable part of the training received. Conclusions: Findings presented in this paper suggest that providing the PINCER pharmacists with training in root cause analysis and educational outreach contributed to the successful delivery of PINCER interventions and could potentially be utilised by other pharmacists based in general practice to deliver pharmaceutical interventions to improve patient safety.