The long-term price-earnings ratio

price-earnings ratio;value premium;arbitrage trading rule;UK stock returns;contrarian investment Abstract:  The price-earnings effect has been thoroughly documented and is the subject of numerous academic studies. However, in existing research it has almost exclusively been calculated on the basis of the previous year's earnings. We show that the power of the effect has until now been seriously underestimated due to taking too short-term a view of earnings. Looking at all UK companies since 1975, using the traditional P/E ratio we find the difference in average annual returns between the value and glamour deciles to be 6%. This is similar to other authors' findings. We are able to almost double the value premium by calculating the P/E ratio using earnings averaged over the previous eight years.

Examination of long-wave radiative bias in general circulation models over North Africa during May–July

Satellite data are used to quantify and examine the bias in the outgoing long-wave (LW) radiation over North Africa during May–July simulated by a range of climate models and the Met Office global numerical weather prediction (NWP) model. Simulations from an ensemble-mean of multiple climate models overestimate outgoing clear-sky long-wave radiation (LWc) by more than 20 W m−2 relative to observations from Clouds and the Earth's Radiant Energy System (CERES) for May–July 2000 over parts of the west Sahara, and by 9 W m−2 for the North Africa region (20°W–30°E, 10–40°N). Experiments with the atmosphere-only version of the High-resolution Hadley Centre Global Environment Model (HiGEM), suggest that including mineral dust radiative effects removes this bias. Furthermore, only by reducing surface temperature and emissivity by unrealistic amounts is it possible to explain the magnitude of the bias. Comparing simulations from the Met Office NWP model with satellite observations from Geostationary Earth Radiation Budget (GERB) instruments suggests that the model overestimates the LW by 20–40 W m−2 during North African summer. The bias declines over the period 2003–2008, although this is likely to relate to improvements in the model and inhomogeneity in the satellite time series. The bias in LWc coincides with high aerosol dust loading estimated from the Ozone Monitoring Instrument (OMI), including during the GERBILS field campaign (18–28 June 2007) where model overestimates in LWc greater than 20 W m−2 and OMI-estimated aerosol optical depth (AOD) greater than 0.8 are concurrent around 20°N, 0–20°W. A model-minus-GERB LW bias of around 30 W m−2 coincides with high AOD during the period 18–21 June 2007, although differences in cloud cover also impact the model–GERB differences. Copyright © Royal Meteorological Society and Crown Copyright, 2010

Patterns of nucleotide substitution in angiosperm cpDNA trnL (UAA)-trnF (GAA) regions

Patterns of substitution in chloroplast encoded trnL_F regions were compared between species of Actaea (Ranunculales), Digitalis (Scrophulariales), Drosera (Caryophyllales), Panicoideae (Poales), the small chromosome species clade of Pelargonium (Geraniales), each representing a different order of flowering plants, and Huperzia (Lycopodiales). In total, the study included 265 taxa, each with > 900-bp sequences, totaling 0.24 Mb. Both pairwise and phylogeny-based comparisons were used to assess nucleotide substitution patterns. In all six groups, we found that transition/transversion ratios, as estimated by maximum likelihood on most-parsimonious trees, ranged between 0.8 and 1.0 for ingroups. These values occurred both at low sequence divergences, where substitutional saturation, i.e., multiple substitutions having occurred at the same (homologous) nucleotide position, was not expected, and at higher levels of divergence. This suggests that the angiosperm trnL-F regions evolve in a pattern different from that generally observed for nuclear and animal mtDNA (transitional/transversion ratio > or = 2). Transition/transversion ratios in the intron and the spacer region differed in all alignments compared, yet base compositions between the regions were highly similar in all six groups. A>-C transversions were significantly less frequent than the other four substitution types. This correlates with results from studies on fidelity mechanisms in DNA replication that predict A<->T and G<->C transversions to be least likely to occur. It therefore strengthens confidence in the link between mutation bias at the polymerase level and the actual fixation of substitutions as recorded on evolutionary trees, and concomitantly, in the neutrality of nucleotide substitutions as phylogenetic markers.

Solar cycle 24: implications for energetic particles and long-term space climate change

The recent solar minimum was the longest and deepest of the space age, with the lowest average sunspot numbers for nearly a century. The Sun appears to be exiting a grand solar maximum (GSM) of activity which has persisted throughout the space age, and is headed into a significantly quieter period. Indeed, initial observations of solar cycle 24 (SC24) continue to show a relatively low heliospheric magnetic field strength and sunspot number (R), despite the average latitude of sunspots and the inclination of the heliospheric current sheet showing the rise to solar maximum is well underway. We extrapolate the available SC24 observations forward in time by assuming R will continue to follow a similar form to previous cycles, despite the end of the GSM, and predict a very weak cycle 24, with R peaking at ∼65–75 around the middle/end of 2012. Similarly, we estimate the heliospheric magnetic field strength will peak around 6nT. We estimate that average galactic cosmic ray fluxes above 1GV rigidity will be ∼10% higher in SC24 than SC23 and that the probability of a large SEP event during this cycle is 0.8, compared to 0.5 for SC23. Comparison of the SC24 R estimates with previous ends of GSMs inferred from 9300 years of cosmogenic isotope data places the current evolution of the Sun and heliosphere in the lowest 5% of cases, suggesting Maunder Minimum conditions are likely within the next 40 years.

The variability of tropical ice cloud properties as a function of the large-scale context from ground-based radar-lidar observations over Darwin, Australia

The high complexity of cloud parameterizations now held in models puts more pressure on observational studies to provide useful means to evaluate them. One approach to the problem put forth in the modelling community is to evaluate under what atmospheric conditions the parameterizations fail to simulate the cloud properties and under what conditions they do a good job. It is the ambition of this paper to characterize the variability of the statistical properties of tropical ice clouds in different tropical "regimes" recently identified in the literature to aid the development of better process-oriented parameterizations in models. For this purpose, the statistical properties of non-precipitating tropical ice clouds over Darwin, Australia are characterized using ground-based radar-lidar observations from the Atmospheric Radiation Measurement (ARM) Program. The ice cloud properties analysed are the frequency of ice cloud occurrence, the morphological properties (cloud top height and thickness), and the microphysical and radiative properties (ice water content, visible extinction, effective radius, and total concentration). The variability of these tropical ice cloud properties is then studied as a function of the large-scale cloud regimes derived from the International Satellite Cloud Climatology Project (ISCCP), the amplitude and phase of the Madden-Julian Oscillation (MJO), and the large-scale atmospheric regime as derived from a long-term record of radiosonde observations over Darwin. The vertical variability of ice cloud occurrence and microphysical properties is largest in all regimes (1.5 order of magnitude for ice water content and extinction, a factor 3 in effective radius, and three orders of magnitude in concentration, typically). 98 % of ice clouds in our dataset are characterized by either a small cloud fraction (smaller than 0.3) or a very large cloud fraction (larger than 0.9). In the ice part of the troposphere three distinct layers characterized by different statistically-dominant microphysical processes are identified. The variability of the ice cloud properties as a function of the large-scale atmospheric regime, cloud regime, and MJO phase is large, producing mean differences of up to a factor 8 in the frequency of ice cloud occurrence between large-scale atmospheric regimes and mean differences of a factor 2 typically in all microphysical properties. Finally, the diurnal cycle of the frequency of occurrence of ice clouds is also very different between regimes and MJO phases, with diurnal amplitudes of the vertically-integrated frequency of ice cloud occurrence ranging from as low as 0.2 (weak diurnal amplitude) to values in excess of 2.0 (very large diurnal amplitude). Modellers should now use these results to check if their model cloud parameterizations are capable of translating a given atmospheric forcing into the correct statistical ice cloud properties.

Intakes and sources of isoflavones, lignans, enterolignans, coumestrol and soya-containing foods in the Norfolk arm of the European Prospective Investigation into Cancer and Nutrition (EPIC-Norfolk), from 7-day food diaries, using a newly updated database

Objective: A phytoestrogen-rich diet has been suggested to protect against a variety of common diseases but UK intake data on phytoestrogens or their food sources is sparse. This study aims to estimate the average intake of isoflavones, lignans, enterolignans and coumestrol from 7-day food diaries (7dFD), and to provide data on total isoflavone, lignan and phytoestrogen consumption by food group. Design: Development of a food composition database for twelve phytoestrogens and analysis of soya food and phytoestrogen consumption in a population-based study. Setting: Men and women, aged 40-79 years from the general population participating in EPIC-Norfolk between 1993 and 1997, with nutrient and food data from 7dFD. Subjects: A subset of 20 437 participants. Results: The median daily phytoestrogen intake for men was 1.20mg (interquartile range (IQR) 0.93-1.54 mg; mean 1.50 mg, SD 1.50 mg) and 0.89 mg for women (IQR 0.71-1.14 mg; mean 1.20 mg, SD 1.70 mg). In soya-consumers (SC), median daily intakes were higher: 2.86 mg in men (IQR – 1.30-7.27mg; mean 5.05 mg, SD 5.03 mg) and 3.14 mg in women (IQR – 1.09-7.33mg; mean 5.40 mg, SD 6.09 mg). In both men and women, bread made the greatest contribution to phytoestrogen intake – 40.7% and 35.7% respectively. In SC men and women, vegetable dishes and soya/goat’s/sheep’s milks were the main contributors – 42.6% and 18.9% in men and 38.8% and 29.1% in women, respectively. Conclusions: The ability to estimate phytoestrogen intake in Western populations more accurately will aid investigations into their suggested effects on health.

Environmental regulation and colonization attributes of the long polar fimbriae (LPF) of Escherichia coli O157:H7

The ability of Escherichia coli O157:H7 to colonize the intestinal epithelia is dependent on the expression of intimin and other adhesins. The chromosome of E. coli O157:H7 carries two loci encoding long polar fimbriae (LPF). These fimbriae mediate adherence to epithelial cells and are associated with colonization of the intestine. In order to increase our knowledge about the conditions controlling their expression and their role in colonization of an animal model, the environmental cues that promote expression of lpf genes and the role of E. coli O157:H7 LPF in intestinal colonization of lambs were investigated. We found that expression of lpf1 was regulated in response to growth phase, osmolarity, and pH; that lpf2 transcription was stimulated during late exponential growth and iron depletion; and that LPF impacts the ability of E. coli O157:H7 to persist in the intestine of infected 6-week-old lambs.

Case study part 1: how to calculate appropriate deterministic long-term toxicity to exposure rates (TERs) for birds and mammals

In the European Union, first-tier assessment of the long-term risk to birds and mammals from pesticides is based on calculation of a deterministic long-term toxicity/exposure ratio(TERlt). The ratio is developed from generic herbivores and insectivores and applied to all species. This paper describes two case studies that implement proposed improvements to the way long-term risk is assessed. These refined methods require calculation of a TER for each of five identified phases of reproduction (phase-specific TERs) and use of adjusted No Observed Effect Levels (NOELs)to incorporate variation in species sensitivity to pesticides. They also involve progressive refinement of the exposure estimate so that it applies to particular species, rather than generic indicators, and relates spraying date to onset of reproduction. The effect of using these new methods on the assessment of risk is described. Each refinement did not necessarily alter the calculated TER value in a way that was either predictable or consistent across both case studies. However, use of adjusted NOELs always reduced TERs, and relating spraying date to onset of reproduction increased most phase-specific TERs. The case studies suggested that the current first-tier TERlt assessment may underestimate risk in some circumstances and that phase-specific assessments can help identify appropriate risk-reduction measures. The way in which deterministic phase-specific assessments can currently be implemented to enhance first-tier assessment is outlined.

Case study part 2: probabilistic modelling of long-term effects of pesticides on individual breeding success in birds and mammals

Abstract: Long-term exposure of skylarks to a fictitious insecticide and of wood mice to a fictitious fungicide were modelled probabilistically in a Monte Carlo simulation. Within the same simulation the consequences of exposure to pesticides on reproductive success were modelled using the toxicity-exposure-linking rules developed by R.S. Bennet et al. (2005) and the interspecies extrapolation factors suggested by R. Luttik et al.(2005). We built models to reflect a range of scenarios and as a result were able to show how exposure to pesticide might alter the number of individuals engaged in any given phase of the breeding cycle at any given time and predict the numbers of new adults at the season’s end.

Environmental oestrogens and breast cancer: long-term low-dose effects of mixtures of various chemical combinations

The incidence of breast cancer has risen worldwide to unprecedented levels in recent decades, making it now the major cancer of women in many parts of the world.1 Although diet, alcohol, radiation and inherited loss of BRCA1/2 genes have all been associated with increased incidence, the main identified risk factors are life exposure to hormones including physiological variations associated with puberty/pregnancy/menopause,1 personal choice of use of hormonal contraceptives2 and/or hormone replacement therapy.3–6 On this basis, exposure of the human breast to the many environmental pollutant chemicals capable of mimicking or interfering with oestrogen action7 should also be of concern.8 Hundreds of such environmental chemicals have now been measured in human breast tissue from a range of dietary and domestic exposure sources7 ,9 including persistent organochlorine pollutants (POPs),10 polybrominated diphenylethers and polybromobiphenyls,11 polychlorinated biphenyls,12 dioxins,13 alkyl phenols,14 bisphenol-A and chlorinated derivatives,15 as well as other less lipophilic compounds such as parabens (alkyl esters of p-hydroxybenzoic acid),16 but studies investigating any association between raised levels of such compounds and the development of breast cancer remain inconclusive.7–16 However, the functionality of these chemicals has continued to be assessed on the basis of individual chemicals rather than the environmental reality of long-term low-dose exposure to complex mixtures. This misses the potential for individuals to have high concentrations of different compounds but with a common mechanism of action. It also misses the complex interactions between chemicals and physiological hormones which together may act to alter the internal homeostasis of the oestrogenic environment of mammary tissue.

A maize bacterial artificial chromosome (BAC) library from the European flint inbred line F2

We report here the construction and characterisation of a BAC library from the maize flint inbred line F2, widely used in European maize breeding programs. The library contains 86,858 clones with an average insert size of approximately 90 kb, giving approximately 3.2-times genome coverage. High-efficiency BAC cloning was achieved through the use of a single size selection for the high-molecular-weight genomic DNA, and co-transformation of the ligation with yeast tRNA to optimise transformation efficiency. Characterisation of the library showed that less than 0.5% of the clones contained no inserts, while 5.52% of clones consisted of chloroplast DNA. The library was gridded onto 29 nylon filters in a double-spotted 8 × 8 array, and screened by hybridisation with a number of single-copy and gene-family probes. A 3-dimensional DNA pooling scheme was used to allow rapid PCR screening of the library based on primer pairs from simple sequence repeat (SSR) and expressed sequence tag (EST) markers. Positive clones were obtained in all hybridisation and PCR screens carried out so far. Six BAC clones, which hybridised to a portion of the cloned Rp1-D rust resistance gene, were further characterised and found to form contigs covering most of this complex resistance locus.

Effect of hypobaric hypoxia, simulating conditions during long-haul air travel, on coagulation, fibrinolysis, platelet function, and endothelial activation

CONTEXT: The link between long-haul air travel and venous thromboembolism is the subject of continuing debate. It remains unclear whether the reduced cabin pressure and oxygen tension in the airplane cabin create an increased risk compared with seated immobility at ground level. OBJECTIVE: To determine whether hypobaric hypoxia, which may be encountered during air travel, activates hemostasis. DESIGN, SETTING, AND PARTICIPANTS: A single-blind, crossover study, performed in a hypobaric chamber, to assess the effect of an 8-hour seated exposure to hypobaric hypoxia on hemostasis in 73 healthy volunteers, which was conducted in the United Kingdom from September 2003 to November 2005. Participants were screened for factor V Leiden G1691A and prothrombin G20210A mutation and were excluded if they tested positive. Blood was drawn before and after exposure to assess activation of hemostasis. INTERVENTIONS: Individuals were exposed alternately (> or =1 week apart) to hypobaric hypoxia, similar to the conditions of reduced cabin pressure during commercial air travel (equivalent to atmospheric pressure at an altitude of 2438 m), and normobaric normoxia (control condition; equivalent to atmospheric conditions at ground level, circa 70 m above sea level). MAIN OUTCOME MEASURES: Comparative changes in markers of coagulation activation, fibrinolysis, platelet activation, and endothelial cell activation. RESULTS: Changes were observed in some hemostatic markers during the normobaric exposure, attributed to prolonged sitting and circadian variation. However, there were no significant differences between the changes in the hypobaric and the normobaric exposures. For example, the median difference in change between the hypobaric and normobaric exposure was 0 ng/mL for thrombin-antithrombin complex (95% CI, -0.30 to 0.30 ng/mL); -0.02 [corrected] nmol/L for prothrombin fragment 1 + 2 (95% CI, -0.03 to 0.01 nmol/L); 1.38 ng/mL for D-dimer (95% CI, -3.63 to 9.72 ng/mL); and -2.00% for endogenous thrombin potential (95% CI, -4.00% to 1.00%). CONCLUSION: Our findings do not support the hypothesis that hypobaric hypoxia, of the degree that might be encountered during long-haul air travel, is associated with prothrombotic alterations in the hemostatic system in healthy individuals at low risk of venous thromboembolism.

An assessment of observed vertical flux divergence in long-term eddy-covariance measurements over two Midwestern forest ecosystems

Vertical divergence of CO2 fluxes is observed over two Midwestern AmeriFlux forest sites. The differences in ensemble averaged hourly CO2 fluxes measured at two heights above canopy are relatively small (0.2–0.5 μmol m−2 s−1), but they are the major contributors to differences (76–256 g C m−2 or 41.8–50.6%) in estimated annual net ecosystem exchange (NEE) in 2001. A friction velocity criterion is used in these estimates but mean flow advection is not accounted for. This study examines the effects of coordinate rotation, averaging time period, sampling frequency and co-spectral correction on CO2 fluxes measured at a single height, and on vertical flux differences measured between two heights. Both the offset in measured vertical velocity and the downflow/upflow caused by supporting tower structures in upwind directions lead to systematic over- or under-estimates of fluxes measured at a single height. An offset of 1 cm s−1 and an upflow/downflow of 1° lead to 1% and 5.6% differences in momentum fluxes and nighttime sensible heat and CO2 fluxes, respectively, but only 0.5% and 2.8% differences in daytime sensible heat and CO2 fluxes. The sign and magnitude of both offset and upflow/downflow angle vary between sonic anemometers at two measurement heights. This introduces a systematic and large bias in vertical flux differences if these effects are not corrected in the coordinate rotation. A 1 h averaging time period is shown to be appropriate for the two sites. In the daytime, the absolute magnitudes of co-spectra decrease with height in the natural frequencies of 0.02–0.1 Hz but increase in the lower frequencies (<0.01 Hz). Thus, air motions in these two frequency ranges counteract each other in determining vertical flux differences, whose magnitude and sign vary with averaging time period. At night, co-spectral densities of CO2 are more positive at the higher levels of both sites in the frequency range of 0.03–0.4 Hz and this vertical increase is also shown at most frequencies lower than 0.03 Hz. Differences in co-spectral corrections at the two heights lead to a positive shift in vertical CO2 flux differences throughout the day at both sites. At night, the vertical CO2 flux differences between two measurement heights are 20–30% and 40–60% of co-spectral corrected CO2 fluxes measured at the lower levels of the two sites, respectively. Vertical differences of CO2 flux are relatively small in the daytime. Vertical differences in estimated mean vertical advection of CO2 between the two measurement heights generally do not improve the closure of the 1D (vertical) CO2 budget in the air layer between the two measurement heights. This may imply the significance of horizontal advection. However, a reliable assessment of mean advection contributions in annual NEE estimate at these two AmeriFlux sites is currently an unsolved problem.