The influence of financial risk tolerance and risk perception on individual investment decision-making in a financial advice context

The aim of this thesis is to examine how risk tolerance and risk perception, two important but often misunderstood constructs, jointly influence client investment decisions in a financial advice context. By distinguishing the roles of these two risk constructs in client decision-making, in this thesis a new direction in studying financial/investment risks is provided while practice and regulation in the financial services industry is potentially informed. Based on the literature relating to risks and individual decision-making, a theoretical framework is developed and relevant hypotheses are tested in two studies with financial adviser clients in Australia. Results reveal that financial risk tolerance influences asset allocation both directly and indirectly through risk perception. The intervening role of risk perception suggests that risk tolerance affects how clients perceive the riskiness of an investment product which influences client decision-making.

Operating efficiency and return to scale of Malaysian REITS: The preliminary findings

This paper aims to present preliminary findings on measuring the technical efficiencies using Data Envelopment Analysis (DEA) in Malaysian Real Estate Investment Trusts (REITs) to determine the best practice for operations which include the asset allocation and scale size to improve the performance of Malaysian REITs. Variables identified as input and output will be assessed in this cross section analysis using the operational approach and Variable Return to Scale DEA (VRS-DEA) by focusing on Malaysian REITs for the year 2013. Islamic REITs have higher efficiency score as compared to the conventional REITs for both models. Diversified REITs are more efficient as compared to the specialised REIT using both models. For Model 1, the negative inefficient value is identified in the managerial inefficiency as compared to the scale inefficiency. This shows that inputs are not fully minimised to produce more outputs. However, when other expenses are considered as different input variables, the efficiency score becomes higher from 60.3% to 81.2%. In model 2, scale inefficiency produce greater inefficiency as compared to the managerial efficiency. The result suggests that Malaysian REITs have been operating at the wrong scale of operations as majority of the Malaysian REITs are operating at decreasing return to scale.

Government cracks down on tax avoidance through foreign investment rules

The Turnbull Government announced yet another measure aimed at addressing tax base erosion and profit shifting, placing additional requirements on new foreign investment under the existing national interest test. In the last 12 months Australia has seen various reforms within the tax system. However, this latest initiative is a shift as it links Australia’s tax regime with its foreign investment regime. It sends a broader signal to the market that Australia will look beyond the collection of tax revenues to a consideration of national interest.

Defoliation and patchy nutrient return drive grazing effects on plant and soil properties in a dairy cow pasture

Large herbivores can influence plant and soil properties in grassland ecosystems, but especially for belowground biota and processes, the mechanisms that explain these effects are not fully understood. Here, we examine the capability of three grazing mechanisms-plant defoliation, dung and urine return, and physical presence of animals (causing trampling and excreta return in patches)-to explain grazing effects in Phleum pratense-Festuca pratensis dairy cow pasture in Finland. Comparison of control plots and plots grazed by cows showed that grazing maintained original plant-community structure, decreased shoot mass and root N and P concentrations, increased shoot N and P concentrations, and had an inconsistent effect on root mass. Among soil fauna, grazing increased the abundance of fungivorous nematodes and Aporrectodea earthworms and decreased the abundance of detritivorous enchytraeids and Lumbricus earthworms. Grazing also increased soil density and pH but did not affect average soil inorganic-N concentration. To reveal the mechanisms behind these effects, we analyzed results from mowed plots and plots that were both mowed and treated with a dung and urine mixture. This comparison revealed that grazing effects on plant attributes were almost entirely explained by defoliation, with only one partly explained by excreta return. Among belowground attributes, however, the mechanisms were more mixed, with effects explained by defoliation, patchy excreta return, and cow trampling. Average soil inorganic-N concentration was not affected by grazing because it was simultaneously decreased by defoliation and increased by cow presence. Presence of cows created great spatial heterogeneity in soil N availability and abundance of fungivorous nematodes. A greenhouse trial revealed a grazing-induced soil feedback on plant growth, which was explained by patchiness in N availability rather than changes in soil biota. Our results show that grazing effects on plant attributes can be satisfactorily predicted using the effects of defoliation, whereas those on soil fauna and soil N availability need understanding of other mechanisms as well. The results indicate that defoliation-induced changes in plant ecophysiology and the great spatial variation in N availability created by grazers are the two key mechanisms through which large herbivores can control grassland ecosystems.

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 Relationship Between Liquidity, Trading Activity and Return - Studies of the Finnish and Swedish Stock Markets

Liquidity, or how easy an investment is to buy or sell, is becoming increasingly important for financial market participants. The objective of this dissertation is to contribute to the understanding of how liquidity affects financial markets. The first essays analyze the actions taken by underwriters immediately after listing to improve liquidity of IPO stock. To estimate the impact of underwriter activity on the pricing of the IPOs, the order book during the first weeks of trading in the IPO stock is studied. Evidence of stabilization and liquidity enhancing activities by underwriters is found. The second half of the dissertation is concerned with the daily trading of stocks where liquidity may be impacted by policy issues such as changes in taxes or exchange fees and by opening the access to the markets for foreign investors. The desirability of a transaction tax on securities trading is addressed. An increase in transaction tax is found to cause lower prices and higher volatility. In the last essay the objective is to determine if the liquidity of a security has an impact on the return investors require. The results support the notion that returns are negatively correlated to liquidity.

On the evaluation of stability of rare earth oxides as face coats for investment casting of titanium

Attempts have been made to evaluate the thermal stability of rare earth oxide face coats against liquid titanium. Determination of microhardness profiles and concentration profiles of oxygen and metallic constituents of oxide in investment cast titanium rods has allowed grActation of relative stability of rare earth oxides. The relative stability of evaluated oxides in the order of increasing stability follows the sequence CeO2 — ZrO2 — Gd2O3 — didymium oxide — Sm2O3 —Nd2O3 — Y2O3. The grading does not follow the free energy data of the formation of these oxides. A better correlation with the experimental observations is obtained when the solubility of the metallic species in titanium is also taken into consideration.

An inquisitive analysis on the temporal variation of return stroke current essential for producing observed remote electro-magnetic fields

The gross characteristics of spatio-temporal current evolution in the return stroke phase of a cloud-to-ground lightning are rather well defined. However, they by themselves do not ensure the salient features for the resulting remote Electro- Magnetic Fields (EMFs). In spite of significant efforts in the engineering models wherein, the spatio-temporal current distribution all along the channel is specified by the design, all the salient features of remote EMFs could not be achieved. Only the current evolution that ensures the basic characteristics along with its ability to reproduce all the salient features of remote EMFs ranging from 50 m – 200 km from the lightning channel, can be considered as a realistic return stroke channel current. In view of this, the present work intends to investigate on the required fine features of the return stroke current evolution that yields all the desired features. To ensure that the current evolution is not arbitrary but obeys the involved basic physical processes, a recently developed physical model will be employed for the analysis.

The role of mate guarding, Male Size and Male Investment on Individual Reproductive Success in the Blue Crab, Callinectes Sapidus.

Male blue crabs, Callinectes Sapidus, guard their mates before and after mating, suggesting that the conditions regulating both types of mate guarding dictate individual reproductive success. I tested the hypothesis that large male blue crabs have advantages in sexual competition using experimental manipulations, a simulation model, and field data on crabs from mid-Chesapeake Bay between 1991-1994.

Three-Dimensional Linear Instability Analysis of Thermocapillary Return Flow on a Porous Plane

A three-dimensional linear instability analysis of thermocapillary convection in a fluid-porous double layer system, imposed by a horizontal temperature gradient, is performed. The basic motion of fluid is the surface-tension-driven return flow, and the movement of fluid in the porous layer is governed by Darcy's law. The slippery effect of velocity at the fluid-porous interface has been taken into account, and the influence of this velocity slippage on the instability characteristic of the system is emphasized. The new behavior of the thermocapillary convection instability has been found and discussed through the figures of the spectrum.

EFFECT OF SURFACE RESISTOR LOADING ON HIGH-IMPEDANCE SURFACE RADAR ABSORBER RETURN LOSS AND BANDWIDTH

A simple method for the selection of the appropriate choice of surface-mounted loading resistor required for a thin radar absorber based on a high-impedance surface (HIS) principle is demonstrated. The absorber consists of a HIS, (artificial magnetic ground plane), thickness 0.03 lambda(0) surface-loaded resistive-elements interconnecting a textured surface of square patches. The properties of absorber are characterized under normal incident using a parallel plate waveguide measurement technique over the operating frequency range of 2.6-3.95 GHz. We show that for this arrangement return loss and bandwidth are insensitive to +/- 2% tolerance variations in surface resistor values about the value predicted using the method elaborated in this letter, and that better than -28 dB at 3.125 GHz reflection loss can be obtained with an effective working bandwidth of up to 11% at -10 dB reflection loss. (C) 2009 Wiley Periodicals, Inc. Microwave Opt Technol Lett 51: 1733-1775, 2009; Published online in Wiley Interscience (www.interscience.wiley.com). DOI 10.1002/mop.24454