The return due to diversification of real estate to the US mixed-asset portfolio

Booth and Fama (1992) observe that the compound return and so the terminal wealth of a portfolio is greater than the weighted average of the compound returns of the individual investments, a difference referred to as the return due to diversification (RDD). Thus assets that offer high RDD should be particularly attractive investments. This paper test the proposition that US direct real estate is such an asset class using annual data over the period 1951-2001. The results show that adding real estate to an existing mixed-asset portfolio increases the compound return and so the terminal wealth of the fund. However, the results are dependent on the percentage allocation to real estate and the asset class replaced.

The temperature response to stratospheric water vapour changes

This study uses an analytical model, based on the cooling-to-space approximation, and a fixed dynamical heating model to investigate the structure of the stratospheric cooling that occurs in response to a uniform increase in stratospheric water vapour (SWV). At all latitudes, the largest cooling occurs in the lower stratosphere and decreases in magnitude with height. The cooling is strongly enhanced in the Extratropics compared to the Tropics. This is markedly different to the case of an increase in CO2, which causes maximum cooling near the stratopause and a small warming in the tropical lower stratosphere. The qualitative differences in the structure of the cooling can be explained by the smaller opacity of water vapour bands in the stratosphere compared to CO2. The small opacity means that the magnitude of the initial heating rate perturbation only decreases by a factor of four between the upper and lower stratosphere for a SWV perturbation. Therefore, to balance the heating rate perturbation, the largest temperature change is required in the lower stratosphere. Increasing the background concentration of SWV causes the water vapour bands to become more opaque. For a SWV perturbation applied to a background SWV concentration ≥30 ppmv, the heating rate perturbation and temperature change structurally resemble those from an increase in CO2. In the Extratropics, the lower height of the tropopause is found to cause the enhancement in the cooling at those latitudes. By controlling the depth of atmosphere which adjusts to the SWV perturbation, the tropopause height affects the net exchange of radiation between the layers in the stratosphere as they cool. The latitudinal gradient in upwelling infrared radiation at the tropopause and variations in the background temperature are found to have only a minor effect on the structure of the stratospheric temperature response to a change in SWV.

Detecting an impact of predation on bird populations depends on the methods used to assess the predators

Summary 1. In recent decades there have been population declines of many UK bird species, which have become the focus of intense research and debate. Recently, as the populations of potential predators have increased there is concern that increased rates of predation may be contributing to the declines. In this review, we assess the methodologies behind the current published science on the impacts of predators on avian prey in the UK. 2. We identified suitable studies, classified these according to study design (experimental ⁄observational) and assessed the quantity and quality of the data upon which any variation in predation rates was inferred. We then explored whether the underlying study methodology had implications for study outcome. 3. We reviewed 32 published studies and found that typically observational studies comprehensively monitored significantly fewer predator species than experimental studies. Data for a difference in predator abundance from targeted (i.e. bespoke) census techniques were available for less than half of the 32 predator species studied. 4. The probability of a study detecting an impact on prey abundance was strongly, positively related to the quality and quantity of data upon which the gradient in predation rates was inferred. 5. The findings suggest that if a study is based on good quality abundance data for a range of predator species then it is more likely to detect an effect than if it relies on opportunistic data for a smaller number of predators. 6. We recommend that the findings from studies which use opportunistic data, for a limited number of predator species, should be treated with caution and that future studies employ bespoke census techniques to monitor predator abundance for an appropriate suite of predators.