Short-run performance of recent Australian on-market share buy-back announcements

Share buy-backs (or share repurchases) have become increasingly popular among Australian companies during the recent times. One of the aims of share buy-back is to increase the shareholders' wealth by increasing the market price of company shares. While there are several ways of buying backs shares, on-market buy-backs is the most popular method of share repurchase in Australia. Australian listed companies have announced more than two hundred on-market share buy-backs over the past three years. The aim of this paper is to examine the short-run market performance of these recent on-market buy-back announcements.

Short-term effect of on-market buy-back announcements on the share price is an issue, which is theoretically interesting and practically important. Buy-back announcements are believed to convey a signal to the market (i.e., signalling effect). If the market considers this signal positively, the short-run price of the shares would increase. If the signal were considered negatively, the short-run price of shares would decrease. If there is no signalling content or the signal is neutral the price would remain the same. In this study, signalling effect of share buy-back announcements is empirically examined using most recent Australian data. The total population of on-market buy-back announcements that have been lodged with Australian Stock Exchange by Australian listed companies during the period from 1 January 2000 to 10 March 2003 are included in this study. The abnormal market return over the short-run (announcement day and 10 trading days centred on the announcement date) is examined using the All Ordinaries Accumulation Index as the reference portfolio. The daily abnormal returns (AR) and cumulative abnormal returns (CAR) during the event period are computed. The results indicate that the Australian market generally positively reacts to on-market buy-back announcements.

An empirical study of the world price of sustainability

The core goal of this study is to empirically investigate whether there is a “world price” of corporate sustainability. This is assessed in the context of standard asset pricing models—in particular, by asking whether a risk premium attaches to a sustainability factor after controlling for the Fama–French factors. Both time-series and cross-sectional tests are formulated and applied. The results show that (1) global Fama–French factors have strong power to explain global equity returns and (2) sustainability investments have no significant impact on global equity returns. The absence of a significant relationship between sustainability and returns implies that large institutional investors are free to implement sustainability mandates without fear of breaching their fiduciary duties from realising negative returns due to incorporating a sustainability investment process.

Equity market price interactions between China and the other markets within the Chinese states equity markets

This study examines the cointegrating and long-term causal relationships of equity market prices in equity markets of Chinese states namely, Shanghai, Shenzhen, Hong Kong, Taiwan and Singapore. I cover the period between October 5, 1992 and March 20, 2006, taking into account both the Asian financial crisis and the opening-up of China’s equity markets in recent years. First, I analysis the cointegration by utilizing Johansen’s (1988) cointegration tests. I find that a long-term equilibrium relationship measured by cointegration has been established among Shanghai, Shenzhen, Hong Kong and Taiwanese markets and, to a lesser degree, between these markets and the Singapore market since 1998. Secondly, this study examines causality by exploring the bootstrapped Toda-Yamamoto non-causality tests. I find that there is strong evidence of a bi-directional causality between Shanghai and Shenzhen markets after 1998. Furthermore, I also find that there are more causal linkages between the Chinese states equity markets: two mainland Chinese markets, Hong Kong, Taiwan, and Singapore became more dependent on each other. The robustness of the above findings is confirmed by the use of a bootstrap test employed to test the validity of my results.

Book-to-market ratio, default risk and return implications: from a negative perspective

A paradox is created by the common practice in stock evaluation models of excluding stocks with a negative book equity (BE). If we interpret the book-to-market ratio as a proxy for distress risk, it makes no sense to exclude these negative BE stocks since they are, prima facie, most prone to distress risk. This paper reassesses the relationship between default risk, return and the book-to-market ratio by incorporating negative BE stocks into the study. We find that negative BE stocks carry higher default risks than their positive BE counterparts and that these risks are not totally offset by higher returns. This suggests that a default risk filter can be used in the investment universe selection process through which the portfolio return can be enhanced.

Gambling, society and the evolution of risk-taking

Gambling is emerging as a major industry around the world at a time when many of the more traditional economic pursuits are becoming less productive, but while the burgeoning gambling industry is certainly profitable and provides good investment opportunities and economic benefits for business and communities alike, it is timely that we look more closely at the overall benefits and costs of this phenomenon in modern society.

In this book about the modern gambling business, a motif of the Colorado River and the Boulder/Hoover Dam is explored in the opening section, likening the benefits and risks of gambling to those of the damming of the Colorado to irrigate California. There can be no doubt that the project wrested many Americans from poverty and unemployment in the depression, built a world-leading engineering structure that served to help the desert bloom, so to speak, including, of course, the re-making of Las Vegas. With the wisdom of hindsight and our increasing environmental awareness, the choking of the Colorado has had its downsides as does the gambling industry as we already know.

From the metaphorical re-examination of Fear and Loathing in Las Vegas, this current book focuses on some of the central aspects of the gambling industry in Australia and around the world, exploring how the industry is traveling in the 21st Century and asking why we are becoming so pre-occupied at this time with the processes of gambling. The prevalence of problem gambling is discussed; the numbers and how they are measured, along with various approaches to treatment and remediation for people affected adversely by their gambling behaviour.

Beyond the ‘bricks and mortar’ gambling and the electronic gaming machines of the latter part of the twentieth century, however, the development of new on-line gambling technologies is introducing different types of products, inducting new consumers to gambling products, changing the face of gambling in society, driving greater profits and potentially spawning more associated problems. While we are still struggling to understand the mechanisms through which more traditional gambling mechanisms affect consumers of these products and how best to remediate or treat such problems, a new form of the gambling phenomenon is being loosed upon modern consumers.

To return to the Hoover Dam metaphor; perhaps this new flood will be too strong for the dam or perhaps it will bring profits and benefits for all concerned. Before we can arrive at a decision about such potential costs and benefits, however, it will be important for us to see just whose money fuels this next phase of industry expansion and whether the profits of the industry are won at the cost of people with gambling problems; people who can’t afford to play the game, let along lose. Will the players in Macau, Singapore, Hong Kong, Vegas, Atlantic City, Sydney and other emerging markets in Asia, along with the new generation of consumers of on-line gambling products, at the end of the day see that their play has been worth the price paid or will the losses to individuals and communities out-weigh the benefits that flow, paradoxically, from this complex industry?

Regimes of risk: the need for a pedagogy for peer groups

Peer groups matter more than we think. In this paper we assert that peer group commitments and affiliations are often the primary social reference in determining the way young people think about and practice risk. It is, we argue, inappropriate to impose adult constructions of risk-taking and anti-social behaviour when trying to assert influence over the decisions and practices young people make in the context of their peers. Prominent in our discussion is a concern that mainstream educational theory and practice focuses disproportionately on the individual and their capacity to make rational and independent choices. We believe that within this individualizing framework, teachers have only a very limited capacity to influence the practices and decisions young people make in the presence of their peers, their friends. To ground this discussion we juxtapose the actions and interactions of two young male peer groups, to highlight their respective constructions of group identity.

Terrify and control: the politics of risk society

The article presents information on the idea of risk management. The origins of the contemporary constructions of risk are found in the seventeenth century, with the development of maritime insurance. In the context of maritime trading, risk came to be seen in terms of the balance between acquisitive opportunities and potential dangers and calculations of future loss of a ship or cargo. Today perceptions of risk affect our actions and strategies in areas of our life as diverse as health, parenting, crime prevention, recreation and travel. Public policy tends to be focused around risk avoidance and risk management, particularly in areas of child protection and aged care. While most of the discussions of risk have focused on risks as bads in society, risk has also been identified as a good. Risk is deemed a good when it challenges people to think differently and creatively. From a neo-liberal perspective risk opens up opportunities for unleashing of entrepreneurial capacity. In the context of the modernist commitment to the idea that people have the potential to control their own destiny, identification of threats and dangers can energize people to be adventurous. The discourse of risk has framed all the reports of the outbreaks of new strains of infection and includes instructions on how to recognize the risk assessments of its spread and instructions on how to avoid its spread.

Do dot coms add value : a preliminary study of the market capitalisation of Australian and Indian telecoms and banking sectors

E-Business is increasingly reshaping the way businesses operate across the globe. Globally, businesses in the banking and telecoms sectors have been re-engineering their value chains by adopting e-Business presence by means of dot com launches. The second half of the 1990s, however, saw both the rise and subsequent collapse of dot com entities as a major focus of investment interest, with consequent speculation over the viability of this corporate vehicle. The perceived increase in market capitalisation by means of these ventures during the boom period is now not so certain. In this paper, we report the results of a preliminary study which investigated the impact of dot com launches on market capitalisation within the banking and telecoms sectors of Australia and India.

Individual, family, school, and community risk and protective factors for depressive symptoms in adolescents : a comparison of risk profiles for substance use and depressive symptoms

This study examines the relationship between adolescent depressive symptoms and risk and protective factors identified for substance use. A questionnaire, developed to measure these factors in a young persons community, family, school, peer group, and individual characteristics for substance use, was used to assess associations with self-reported depressive symptoms. Data were provided by a representative sample of 8984 secondary school students in Victoria, Australia. The prevalence of depressive symptoms was 10.5% (95% CI 9.2,12.0) for males and 21.7% (95% CI 20.3,23.7) for females. Depressive symptoms were associated with factors in all domains, with the strongest associations in the family domain. Strong relationships were found between the number of elevated risk and protective factors and depressive symptoms, maintained after adjusting for substance use. Patterns of associations were similar for users and nonsubstance users. The findings indicate that prevention programs targeting factors for substance use have the potential to impact on depression.

A cross-national comparison of risk and protective factors for adolescent substance use : the United States and Australia

Purpose
To compare risk and protective factors that influence youth substance use in Australia and the United States. The two countries have different policy orientations toward substance use: Australia has adopted harm-reduction policies, and the United States has adopted abstinence-focused polices.

Methods
Cross-sectional survey data were collected from independent samples of adolescents in the states of Maine (N = 16,861; 53% female, 7% Non-white) and Oregon (N = 15,542; 51% female, 24% Non-white) in the United States and Victoria in Australia (N = 8442; 54% Female, 11% Non-white) in 1998 (Maine and Oregon) and 1999 (Victoria). Chi-square tests, t-tests, effect size comparisons, and logistic regression analyses that accounted for age and gender were used to investigate cross-national similarities and differences in: (a) rates of cigarette, alcohol, and marijuana use; (b) levels of risk and protective factors; and (c) magnitudes of associations between risk and protective factors and substance use.

Results
More adolescents in Victoria reported using cigarettes and alcohol, whereas more of the U.S. adolescents reported using marijuana. Exposure to risk and protective factors was generally similar in the cross-national samples. However, adolescents in Maine and Oregon perceived handguns to be more readily available, reported more participation in religious activities, and were higher in sensation-seeking and social skills; and adolescents in Victoria had more favorable attitudes toward drug use and reported community norms and parental attitudes more favorable to drug use. Most of the risk and protective factors were strongly associated with substance use to a similar degree in Victoria, Maine, and Oregon. However, among adolescents in Maine and Oregon peer/individual risk and protective factors associated with social detachment were more strongly related to substance use, and among adolescents in Victoria, family protective factors were less strongly related to alcohol use.

Conclusions
Inter-country influences on youth substance use are generally similar despite different policy directions. Existing differences suggest that the abstinence policy context is associated with higher levels of illicit drug use and stronger relations between individual indicators of social detachment and substance use, whereas the harm reduction policy context is related to more cigarette and alcohol use, possibly from exposure to normative influences that are more tolerant of youth drug use.

Market capitalization of Australian stock exchange (ASX) listed biotechnology companies

Comments on the market capitalization of Australian Stock Exchange listed biotechnology companies. Background on the Australian biotechnology stock market; Factors which determine the levels of risks; Points to consider when valuing Australian biotechnology companies.