Financing of SME's: an asset side story

The main sources of financing for small and medium sized enterprises (SMEs) are equity (internally generated cash), trade credit paid on time, long and short term bank credits, delayed payment on trade credit and other debt. The marginal costs of each financing instrument are driven by asymmetric information (cost of gathering and analysing information) and transactions costs associated with non-payment (costs of collecting and selling collateral). According to the Pecking Order Theory, firms will choose the cheapest source in terms of cost. In the case of the static trade-off theory, firms choose finance so that the marginal costs across financing sources are all equal, thus an additional Euro of financing is obtained from all the sources whereas under the Pecking Order Theory the source is determined by how far down the Pecking Order the firm is presently located. In this paper, we argue that both of these theories miss the point that the marginal costs are dependent of the use of the funds, and the asset side of the balance sheet primarily determines the financing source for an additional Euro. An empirical analysis on a unique dataset of Portuguese SME's confirms that the composition of the asset side of the balance sheet has an impact of the type of financing used and the Pecking Order Theory and the traditional Static Trade-off theory are rejected.

Dynamic Density Forecasts for Multivariate Asset Returns

We propose a simple and flexible framework for forecasting the joint density of asset returns. The multinormal distribution is augmented with a polynomial in (time-varying) non-central co-moments of assets. We estimate the coefficients of the polynomial via the Method of Moments for a carefully selected set of co-moments. In an extensive empirical study, we compare the proposed model with a range of other models widely used in the literature. Employing a recently proposed as well as standard techniques to evaluate multivariate forecasts, we conclude that the augmented joint density provides highly accurate forecasts of the ���negative tail��� of the joint distribution.

Novel linkage to chromosome 20p using latent classes of psychotic illness in 270 Irish high-density families

Background: Several lines of evidence suggest that the clinical heterogeneity of schizophrenia is due to genetic heterogeneity. Genetic heterogeneity may decrease the signal-to-noise ratio in linkage and association studies. Therefore, linkage studies of clinically homogeneous classes of psychotic illness may result in greater power to detect at least some loci.

Down with MNE-centric theories! Market entry and expansion as the bundling of MNE and local assets

Both Anderson and Gatignon and the Uppsala internationalization model see the initial mode of foreign market entry and subsequent modes of operation as unilaterally determined by multinational enterprises (MNEs) arbitraging control and risk and increasing their commitment as they gain experience in the target market. OLI and internalization models do recognize that foreign market entry requires the bundling of MNE and complementary local assets, which they call location or country-specific advantages, but implicitly assume that those assets are freely accessible to MNEs. In contrast to both of these MNE-centric views, I explicitly consider the transactional characteristics of complementary local assets and model foreign market entry as the optimal assignment of equity between their owners and MNEs. By looking at the relative efficiency of the different markets in which MNE and complementary local assets are traded, and at how these two categories of assets match, I am able to predict whether equity will be held by MNEs or by local firms, or shared between them, and whether MNEs will enter through greenfields, brownfields, or acquisitions. The bundling model I propose has interesting implications for the evolution of the MNE footprint in host countries, and for the reasons behind the emergence of Dragon MNEs.

Determinantes da estrutura de capitais do setor do cal��ado em Portugal

Disserta����o de Mestrado apresentado ao Instituto de Contabilidade e Administra����o do Porto para a obten����o do grau de Mestre em Contabilidade e Finan��as, sob orienta����o de Mestre Adalmiro ��lvaro Malheiro de Castro Andrade Pereira

Comparative analysis of Spanish Banks��� Standalone credit profile

The paper studies the relationship between four differently rated bank���s financial profile and their standalone credit rating issued by Moody���s. The comparative analysis shows an example that despite their pricing power and geographical coverage, larger banks do not necessarily have better credit ratings. Instead, business model and risk appetite seem to be the defining factors of banks��� vulnerability to shocks, such as the Spanish real estate crisis. The risk-return relationship is also identified in the banks��� fundamentals meaning that while expansionary strategy in riskier asset classes enhances margins, it also potentially distorts the credit risk profile.

Systematic analysis of protein complexes involved in the human RNA polymerase II machinery

La transcription, la maturation d���ARN, et le remodelage de la chromatine sont tous des processus centraux dans l'interpr��tation de l'information contenue dans l���ADN. Bien que beaucoup de complexes de prot��ines formant la machinerie cellulaire de transcription aient ��t�� ��tudi��s, plusieurs restent encore �� identifier et caract��riser. En utilisant une approche prot��omique, notre laboratoire a purifi�� plusieurs composantes de la machinerie de transcription de l���ARNPII humaine par double chromatographie d���affinit�� "TAP". Cette proc��dure permet l'isolement de complexes prot��iques comme ils existent vraisemblablement in vivo dans les cellules mammif��res, et l'identification de partenaires d'interactions par spectrom��trie de masse. Les interactions prot��iques qui sont valid��es bioinformatiquement, sont choisies et utilis��es pour cartographier un r��seau connectant plusieurs composantes de la machinerie transcriptionnelle. En appliquant cette proc��dure, notre laboratoire a identifi��, pour la premi��re fois, un groupe de prot��ines, qui interagit physiquement et fonctionnellement avec l���ARNPII humaine. Les propri��t��s de ces prot��ines sugg��rent un r��le dans l'assemblage de complexes �� plusieurs sous-unit��s, comme les prot��ines d'��chafaudage et chaperonnes. L'objectif de mon projet ��tait de continuer la caract��risation du r��seau de complexes prot��iques impliquant les facteurs de transcription. Huit nouveaux partenaires de l���ARNPII (PIH1D1, GPN3, WDR92, PFDN2, KIAA0406, PDRG1, CCT4 et CCT5) ont ��t�� purifi��s par la m��thode TAP, et la spectrom��trie de masse a permis d���identifier de nouvelles interactions. Au cours des ann��es, l���analyse par notre laboratoire des m��canismes de la transcription a contribu�� �� apporter de nouvelles connaissances et �� mieux comprendre son fonctionnement. Cette connaissance est essentielle au d��veloppement de m��dicaments qui cibleront les m��canismes de la transcription.

On the Effects of Mergers on Equilibrium Outcomes in a Common Property Renewable Asset Oligopoly

This paper examines a dynamic game of exploitation of a common pool of some renewable asset by agents that sell the result of their exploitation on an oligopolistic market. A Markov Perfect Nash Equilibrium of the game is used to analyze the effects of a merger of a subset of the agents. We study the impact of the merger on the equilibrium production strategies, on the steady states, and on the profitability of the merger for its members. We show that there exists an interval of the asset's stock such that any merger is profitable if the stock at the time the merger is formed falls within that interval. That includes mergers that are known to be unprofitable in the corresponding static equilibrium framework.

Betweenness Centrality in Some Classes of Graphs

There are several centrality measures that have been introduced and studied for real world networks. They account for the different vertex characteristics that permit them to be ranked in order of importance in the network. Betweenness centrality is a measure of the influence of a vertex over the flow of information between every pair of vertices under the assumption that information primarily flows over the shortest path between them. In this paper we present betweenness centrality of some important classes of graphs.

A sovereign wealth fund to lift Germany's curse of excess savings. CEPS Policy Brief No. 280, 28 August 2012

As an alternative to the present system of intermediation of the German savings surplus, this paper suggests that the risk-adjusted rate of return could be improved by creating a sovereign wealth fund for Germany (designated DESWF), which could invest excess German savings globally. Such a DESWF would offer German savers a secure vehicle paying a guaranteed positive minimum real interest rate, with a top-up when real investment returns allowed. The vehicle would invest the funds in a portfolio that is highly diversified by geography and asset classes. Positive real returns can be expected in the long run based on positive real global growth. Since, in this case, a significant amount of funds would flow outside the euro area, the euro would depreciate, which would help crisis countries presently struggling to revive growth through exports and to close their external deficits so as to recoup their international credit-worthiness. Target imbalances would gradually disappear and German claims abroad would move from nominal claims on the ECB to diversified real and nominal claims on various private and public foreign entities in a variety of asset classes.

Drivers of fund performance: a panel data analysis

The principle aim of this research is to elucidate the factors driving the total rate of return of non-listed funds using a panel data analytical framework. In line with previous results, we find that core funds exhibit lower yet more stable returns than value-added and, in particular, opportunistic funds, both cross-sectionally and over time. After taking into account overall market exposure, as measured by weighted market returns, the excess returns of value-added and opportunity funds are likely to stem from: high leverage, high exposure to development, active asset management and investment in specialized property sectors. A random effects estimation of the panel data model largely confirms the findings obtained from the fixed effects model. Again, the country and sector property effect shows the strongest significance in explaining total returns. The stock market variable is negative which hints at switching effects between competing asset classes. For opportunity funds, on average, the returns attributable to gearing are three times higher than those for value added funds and over five times higher than for core funds. Overall, there is relatively strong evidence indicating that country and sector allocation, style, gearing and fund size combinations impact on the performance of unlisted real estate funds.

How often does direct real estate increase the risk-adjusted performance of the US mixed-asset portfolio?

The ���case for real estate��� in the mixed-asset portfolio is a topic of continuing interest to practitioners and academics. The argument is typically made by comparing efficient frontiers of portfolio with real estate to those that exclude real estate. However, most investors will have held inefficient portfolios. Thus, when analysing the real estate���s place in the mixed-asset portfolio it seems illogical to do so by comparing the difference in risk-adjusted performance between efficient portfolios, which few if any investor would have held. The approach adopted here, therefore, is to compare the risk-adjusted performance of a number of mixed-asset portfolios without real estate (which may or not be efficient) with a very large number of mixed-asset portfolios that include real estate (which again may or may not be efficient), to see the proportion of the time when there is an increase in risk-adjusted performance, significant or otherwise using appraisal-based and de-smoothed annual data from 1952-2003. So to the question how often does the addition of private real estate lead to increases the risk-adjusted performance compared with mixed-asset portfolios without real estate the answer is almost all the time. However, significant increases are harder to find. Additionally, a significant increase in risk-adjusted performance can come from either reductions in portfolio risk or increases in return depending on the investors��� initial portfolio structure. In other words, simply adding real estate to a mixed-asset portfolio is not enough to ensure significant increases in performance as the results are dependent on the percentage added and the proper reallocation of the initial portfolio mix in the expanded portfolio.

Real estate in the mixed-asset portfolio: the question of consistency

The recent poor performance of the equity market in the UK has meant that real estate is increasingly been seen as an attractive addition to the mixed-asset portfolio. However, determining whether the good return enjoyed by real estate is a temporary or long-term phenomenon is a question that remains largely unanswered. In other words, there is little or no evidence to indicate whether real estate should play a consistent role in the mixed-asset portfolio over short- and long-term investment horizons. Consistency in this context refers to the ability of an asset to maintain a positive allocation in an efficient portfolio over different holding periods. Such consistency is a desirable trait for any investment, but takes on particular significance when real estate is considered, as the asset class is generally perceived to be a long-term investment due to illiquidity. From an institutional investor���s perspective, it is therefore crucial to determine whether real estate can be reasonably expected to maintain a consistent allocation in the mixed-asset portfolio in both the short and long run and at what percentage. To address the question of consistency the allocation of real estate in the mixed-asset portfolio was calculated over different holding periods varying from 5- to 25-years.

Re-thinking commercial real estate market segmentation

Investments in direct real estate are inherently difficult to segment compared to other asset classes due to the complex and heterogeneous nature of the asset. The most common segmentation in real estate investment analysis relies on property sector and geographical region. In this paper, we compare the predictive power of existing industry classifications with a new type of segmentation using cluster analysis on a number of relevant property attributes including the equivalent yield and size of the property as well as information on lease terms, number of tenants and tenant concentration. The new segments are shown to be distinct and relatively stable over time. In a second stage of the analysis, we test whether the newly generated segments are able to better predict the resulting financial performance of the assets than the old dichotomous segments. Applying both discriminant and neural network analysis we find mixed evidence for this hypothesis. Overall, we conclude from our analysis that each of the two approaches to segmenting the market has its strengths and weaknesses so that both might be applied gainfully in real estate investment analysis and fund management.