Risk-return trade-off and autocorrelation

A trade-off between return and risk plays a central role in financial economics. The intertemporal capital asset pricing model (ICAPM) proposed by Merton (1973) provides a neoclassical theory for expected returns on risky assets. The model assumes that risk-averse investors (seeking to maximize their expected utility of lifetime consumption) demand compensation for bearing systematic market risk and the risk of unfavorable shifts in the investment opportunity set. Although the ICAPM postulates a positive relation between the conditional expected market return and its conditional variance, the empirical evidence on the sign of the risk-return trade-off is conflicting. In contrast, autocorrelation in stock returns is one of the most consistent and robust findings in empirical finance. While autocorrelation is often interpreted as a violation of market efficiency, it can also reflect factors such as market microstructure or time-varying risk premia. This doctoral thesis investigates a relation between the mixed risk-return trade-off results and autocorrelation in stock returns. The results suggest that, in the case of the US stock market, the relative contribution of the risk-return trade-off and autocorrelation in explaining the aggregate return fluctuates with volatility. This effect is then shown to be even more pronounced in the case of emerging stock markets. During high-volatility periods, expected returns can be described using rational (intertemporal) investors acting to maximize their expected utility. During lowvolatility periods, market-wide persistence in returns increases, leading to a failure of traditional equilibrium-model descriptions for expected returns. Consistent with this finding, traditional models yield conflicting evidence concerning the sign of the risk-return trade-off. The changing relevance of the risk-return trade-off and autocorrelation can be explained by heterogeneous agents or, more generally, by the inadequacy of the neoclassical view on asset pricing with unboundedly rational investors and perfect market efficiency. In the latter case, the empirical results imply that the neoclassical view is valid only under certain market conditions. This offers an economic explanation as to why it has been so difficult to detect a positive tradeoff between the conditional mean and variance of the aggregate stock return. The results highlight the importance, especially in the case of emerging stock markets, of noting both the risk-return trade-off and autocorrelation in applications that require estimates for expected returns.

The Pay-Off Method as a Tool for Evaluating the Risk and Profitability of Public Real Estate Investments

Real option valuation, in particular the fuzzy pay-off method, has proven to be useful in defining risk and visualizing imprecision of investments in various industry applications. This study examines whether the evaluation of risk and profitability for public real estate investments can be improved by using real option methodology. Firstly, the context of real option valuation in the real estate industry is examined. Further, an empirical case study is performed on 30 real estate investments of a Finnish government enterprise in order to determine whether the presently used investment analysis system can be complemented by the pay-off method. Despite challenges in the application of the pay-off method to the case company’s large investment base, real option valuation is found to create additional value and facilitate more robust risk analysis in public real estate applications.

Schools as Oral Health Promoters – Evaluation of National Sweet Selling Recommendation and Oral Health Education Material

The aims were to find out 1) if schools’ oral health practices were associated with pupils’ oral health behaviour and whether 2) the national sweet-selling recommendation and 3) distributing oral health material (OHEM) affected schools as oral health promoters. Three independently collected datasets from Finnish upper comprehensive schools (N=988) were used: longitudinal oral health practices data (n=258) with three-year follow up (2007 n=480, 2008 n=508, 2009 n=593) from principals’ online questionnaires, oral health behaviour data from pupils participating in the national School Health Promotion Study (n=970 schools) and oral health education data from health education teachers’ online questionnaires (2008 n=563, 2009 n=477 teachers). Oral health practices data and oral health behaviour data were combined (n=414) to answer aim 1. For aims 2 and 3, oral health practices data and oral health education data were used independently. School sweet selling and an open campus policy were associated with pupils’ use of sweet products and tobacco products during school time. The National Recommendation was quite an effective way to reduce the number of sweet-selling schools, but there were large regional differences and a lack of a clear oral health policy in the schools. OHEM did not increase the proportion of teachers teaching oral health, but teachers started to cover oral health topics more frequently. Women started to use OHEM more often than men did. Schools’ oral health policy should include prohibiting the selling of sweet products in school by legislative actions, enabling healthy alternatives instead, and setting a closed campus policy to protect pupils from school-time sweet consuming and smoking.

Changing teachers´ practices in regular schools enrolling children with visual impairment

The number of persons with visual impairment in Tanzania is estimated to over 1.6 million. About half a million of these persons are children aged 7-13. Only about 1% of these children are enrolled in schools. The special schools and units are too few and in most cases they are far away from the children’s homes. More and more regular schools are enrolling children with visual impairment, but the schools lack financial resources, tactile teaching materials and trained special education teachers. Children with visual impairment enrolled in regular schools seldom get enough support and often fail in examinations. The general aim of this study was to contribute to increased knowledge and understanding about how teachers can change their teaching practices and thus facilitate the learning of children with visual impairment included in regular classrooms as they participate in an action research project. The project was conducted in a primary school in a poor rural region with a high frequency of blindness and visual impairment. The school was poorly resourced and the average number of pupils per class was 90. The teachers who participated in the collaborative action research project were the 14 teachers who taught blind or visually impaired pupils in grades 4 and 6, in total 6 pupils. The action research project was conducted during a period of 6 months and was carried out in five cycles. The teachers were actively involved in all the project activities; identifying challenges, planning solutions, producing teaching materials, reflecting on outcomes, collaborating and evaluating. Empirical data was collected with questionnaires, interviews, observations and focus group discussions. The findings of the study show that the teachers managed to change their teaching practices through systematic reflection, analysis and collaboration. The teachers produced a variety of tactile teaching materials, which facilitated the learning of the pupils with visual impairment. The pupils learned better and felt more included in the regular classes. The teachers gained new knowledge and skills. They grew professionally and started to collaborate with each other. The study contributes to new knowledge of how collaborative action research can be conducted in the area of special education in a Tanzanian school context. The study has also relevance to the planning of school-based professional development programs and teacher education programs in Tanzania and in other low-income countries. The results also point at strategies which can promote inclusion of children with disabilities in regular schools.

Social Solidarity and Fear of Crime - Community and Individual Approaches in Responses to Mass Violence after School Shootings

The aim of this study was to examine community and individual approaches in responses to mass violence after the school shooting incidents in Jokela (November 2007) and Kauhajoki (September 2008), Finland. In considering the community approach, responses to any shocking criminal event may have integrative, as well as disintegrative effects, within the neighborhood. The integration perspective argues that a heinous criminal event within one’s community is a matter of offence to collectively held feelings and beliefs, and increases perceived solidarity; whereas the disintegration perspective suggests that a criminal event weakens the social fabric of community life by increasing fear of crime and mistrust among locals. In considering the individual approach, socio-demographic factors, such as one’s gender, are typically significant indicators, which explain variation in fear of crime. Beyond this, people are not equally exposed to violent crime and therefore prior victimization and event related experiences may further explain why people differ in their sensitivity to risk from mass violence. Finally, factors related to subjective mental health, such as depressed mood, are also likely to moderate individual differences in responses to mass violence. This study is based on the correlational design of four independent cross-sectional postal surveys. The sampling frames (N=700) for the surveys were the Finnish speaking adult population aged 18–74-years. The first mail survey in Jokela (n=330) was conducted between May and June 2008, approximately six months from the shooting incident at the local high-school. The second Jokela survey (n=278) was conducted in May–June of 2009, 18 months removed from the incident. The first survey in Kauhajoki (n=319) was collected six months after the incident at the local University of Applied Sciences, March– April 2009, and the second (n=339) in March–April 2010, approximately 18 months after the event. Linear and ordinal regression and path analysis are used as methods of analyses. The school shootings in Jokela and Kauhajoki were extremely disturbing events, which deeply affected the communities involved. However, based on the results collected, community responses to mass violence between the two localities were different. An increase in social solidarity appears to apply in the case of the Jokela community, but not in the case of the Kauhajoki community. Thus a criminal event does not necessarily impact the wider community. Every empirical finding is most likely related to different contextual and event-specific factors. Beyond this, community responses to mass violence in Jokela also indicated that the incident was related to a more general sense of insecurity and was also associating with perceived community deterioration and further suggests that responses to mass violence may have both integrating and disintegrating effects. Moreover, community responses to mass violence should also be examined in relation to broader social anxieties and as a proxy for generalized insecurity. Community response is an emotive process and incident related feelings are perhaps projected onto other identifiable concerns. However, this may open the door for social errors and, despite integrative effects, this may also have negative consequences within the neighborhood. The individual approach suggests that women are more fearful than men when a threat refers to violent crime. Young women (aged 18–34) were the most worried age and gender group as concerns perception of threat from mass violence at schools compared to young men (aged 18–34), who were also the least worried age and gender group when compared to older men. It was also found that concerns about mass violence were stronger among respondents with the lowest level of monthly household income compared to financially better-off respondents. Perhaps more importantly, responses to mass violence were affected by the emotional proximity to the event; and worry about the recurrence of school shootings was stronger among respondents who either were a parent of a school-aged child, or knew a victim. Finally, results indicate that psychological wellbeing is an important individual level factor. Respondents who expressed depressed mood consistently expressed their concerns about mass violence and community deterioration. Systematic assessments of the impact of school shooting events on communities are therefore needed. This requires the consolidation of community and individual approaches. Comparative study designs would further benefit from international collaboration across disciplines. Extreme school violence has also become a national concern and deeper understanding of crime related anxieties in contemporary Finland also requires community-based surveys.

Fundraising and investor relations in social enterprise: Marketing your way out of the pioneer gap in African off-grid renewable energy

Social enterprises apply the best of business for the pursuit of social or environmental mission while also generating revenues. Globally, nearly 1,3 billion people lack access to electricity, as well as another billion having access to only low quality and infrequent electricity. Off-grid renewable energy, like solar, will increasingly have a key role in the solution of the energy access issue. The pioneer gap in off-grid renewable energy consists of financing (or funding) gaps and capacity gaps, to do with both the early stage of the enterprises in question, as well as the early stage of the whole industry. The gaps are emphasised by specific characteristics of off-grid renewable energy business models and the requirements of operating in bottom-of-the-pyramid markets. The marketing perspective to fundraising is chosen to uncover the possible role enterprises themselves have in bridging the pioneer gap. The purpose of this thesis is to study how social enterprises operating in off-grid renewable energy in Africa utilise marketing activities in their investor relations in bridging the pioneer gap. This main research question is divided into the following sub-questions:  How does the pioneer gap affect fundraising for these enterprises?  How are the funding needs for these enterprises characterised?  How do these enterprises build trust in their investor relations? The theoretic framework is built on relationship marketing and investor relations, with an emphasis on creation of trust. The research is conducted as a thematical case study. Primary data is gathered via semi-structured interviews with six solar energy companies and two accelerators. According to the findings, the main components affecting trust-creation are diminished information asymmetry and perceived risk, mission alignment as well as a personal fit or relationship with the investor. Therefore, an enterprise can utilise e.g. the following marketing activities in their investor relations to bridge the pioneer gap: ensuring investor material, the enterprise story and presenting of them is clear, concise and complete to “package” the enterprise as an investment; taking investor needs and motivations into account as well as utilising existing investors as ambassadors.

Vibration analysis of a power take-off line

Gear rattle is a phenomenon that occurs when idling or lightly loaded gears collide due to engine’s torque fluctuations. This behaviour is related to vibration behaviour of the transmission system. Aim of this master’s thesis is to evaluate Adams and Adams/Machinery as a simulation tools for modelling the rattle e ect in a transmission system. A case study of tractor’s power take-o driveline, suspected to be prone to rattle, is performed in this work. Modelling methods used by Adams in this type of study are presented in the theory section while simulation model build with the software during this work is presented in the results. The Machinery toolbox is used to create gears and bearings while other model components are created with standard Adams tool set. Geometries and excitations are exported from other softwares. Results were obtained from multiple variations of a base model. These result sets and literature review suggest that Adams/Machinery may not be the most suitable tool for rattle analysis. While the system behaviour was partially captured, for accurate modelling user-written routines must be used which may be more easily performed with other tools. Further research about this topic is required.

Quality of Canned mandarin as affected by preservation liquid

This study is integrated within a research line dedicated to evaluate different options to introduce mandarin in Spanish agro-food industries and in both national and international markets. The effects of different preservation liquids (sucrose solution, sucrose and ascorbic acid solution, grape, and grapefruit juices), soluble solids (10, 12, 14 ºBrix), and thermal processing (30 seconds at 98 ºC) on vitamin C, color, carotenoids and sensory quality of canned Satsuma mandarin segments were studied. The liquid preservation that presented the best results was grapefruit juice, which provided the highest vitamin C (323 mg.L-1) and total carotenoids (16.4 mg.L-1) contents (the main carotenoid found was β-cryptoxanthin), intense orange color, high thermal stability, and very good sensory quality (e.g. intense floral and fresh-mandarin aromas and low levels of off-flavors).

Yritysvalmennuksen onnistumiset ja kehittämiskohteet Case: Start-up & Spin-off Factory -projekti

Tässä työssä tarkastellaan Start-up & Spin-off Factory -projektissa, pääsääntöisesti Kymenlaaksossa toimiville, yrittäjille suunnattua ja toteutettua yritysvalmennusohjelmaa. Työssä selvitetään ja käsitellään Start-up & Spin-off -projektin yritysvalmennuksen onnistumisia ja kehittämiskohteita sähköisen kyselyn sekä teemahaastatteluiden pohjalta. Start-up & Spin-off Factory -projektissa tuettiin innovatiivisten yritysten (21 yritystä) kasvua kiihdytysohjelmalla, jossa kokeneet sarjayrittäjät valmensivat uutta yritystä perustavia tai jo yritystoiminnan aloittaneita yrittäjiä, joiden tuotteille/palveluille haluttiin saada kasvua. Projektin tavoitteena oli edistää erityisesti kiihdytettävien yritysten nopeaa kansainvälistymistä auttamalla yrittäjiä pilottien, asiakkaiden, partnerien ja rahoituksen hankinnassa. Valmennettavat kokivat saaneensa lisäarvoa valmennuksesta omaksumalla uusia näkökulmia. He kokivat koulutuksen tuoneen yrityksen toimintaan lisää nöyrää asennetta ja lujaa uskoa tulevaisuuteen. Vertaistuen osuutta sekä verkostojen lisääntymisen mukana tullutta uusien kontaktien määrää pidettiin myönteisenä asiana. Vastausten perusteella valmennus selkeytti valmennettavien ymmärrystä liiketoiminnan kehittämisestä. Hissipuheen teko ja harjoittelu koettiin tärkeäksi ja jännittäväksi. Valmennus vahvisti luottamusta omaan tuotteeseen ja palveluun. Valmennuksen painottuminen ICT-alan firmoihin merkitsi valmennuksessa sitä, että teoriat ja esimerkit tulivat useasti tältä alalta. Toimialojen eroavaisuus tulisi huomioida valmennuksessa opetussisältöjen ja esimerkkien osalta. Kyselyn ja haastatteluiden mukaan valmentajien asiantuntemukseen oltiin tyytyväisiä. Lisäksi onnistuneena osa-alueena koettiin valmennuksen käytännön järjestelyjä. Kehitettävää puolestaan oli opetusmateriaalien, opetusmenetelmien ja koulutuksen keston suhteen. Kysyttäessä valmennuksen hyvistä ja huonoista puolista olivat vastaajat sitä mieltä, että valmennuksessa oli hyvä ilmapiiri ja valmennus oli käytännönläheistä. Pienryhmävalmennusta pidettiin hyvänä asiana, samoin kuin henkilökohtaistamista.

Suomalaisten yliopistojen life science-alan spin-off-yritysten rahoitustilanne, -lähteet ja –riskit

Life science-ala on rahoituksellisesti erittäin haastava, koska tuotekehitysputket ovat 10-15 vuoden pituisia ja voivat vaatia suuria etupainotteisia investointeja. Monet life science-alan yritykset ovat niin Suomessa kuin kansainvälisestikin syntyneet suoraan yliopistosta niin sanottuina spin-off-yrityksinä. Yrityksen perustaminen tutkimustiedon pohjalle on yksi akateemisen yrittäjyyden muodoista. Tässä tutkimuksessa tutkitaan akateemista yrittäjyyttä life science-alalla Suomessa. Suomessa life science-alan osaaminen on kansainvälistä huippua ja alalle on syntynyt useita spin-off-yrityksiä viime vuosina. Aiemmat tutkimukset ovat keskittyneet erityisesti agentti-päämiesongelmiin akateemisessa yrittäjyydessä ja life science alaa puolestaan on käsitelty usein pelkästään yhtenä alana. Tutkimuksessa pyritään analysoimaan life science-alan eri painopiste-alueita tarkemmin rahoitusstrategisesta näkökulmasta, koska ala ei ole homogeeninen. Akateemisen yrittäjyyden agenttiongelmaa pyritään tarkoittamaan Suomen yliopistomaailmassa life science-alalta käsin. Tutkimus toteutetaan kvalitatiivisena haastattelututkimuksena ja sitä tukevana tilinpäätöstietojen analysointina. Tutkimuksen tulokset vahvistavat agentti-päämiesongelmien olemassaolon suomalaisessa yliopistomaailmassa. Ongelmien osapuolina ovat niin akateemikot, yliopiston innovaatiopalvelut kuin TEKES:kin. Yrittäjät kaipaavat kokonaisvaltaisempaa apua, koska kokevat alalla liiketoimintaosaamisen puuttuvan monin paikoin. Alan vaatimien runsaiden tuotekehityspanostusten vuoksi alan yritykset ovat pitkään raskaasti tappiollisia. Yritysten valitsemat rahoitusratkaisut vaihtelevat suuresti. Kaikki tutkitut yritykset pyrkivät kasvamaan nykyisten ydintuotteidensa mukana ja ovat jo jossain määrin hankkineet rahoitusta kasvustrategiaansa varten. Alan pääomaintensiivisyydestä johtuen ovat monet yritykset kuitenkin suunnittelemassa tai jo päätyneet tekemään yhteistyötä integroituen alalla joko vertikaalisesti tai horisontaalisesti. Tutkimuksen tulokset vahvistavat aiemman käsityksen, jonka mukaan life science-alan yrityksiä on vaikea arvioida ulkopuolelta pelkästään tilinpäätöstietojen pohjalta, koska alkuvaiheessa rahoituskierrokset ja tappiolliset vuoden seuraavat toisiaan ja toisaalta yrityksen arvo sitoutuu pitkiin tuotekehitysputkiin, jotka eivät välttämättä näy tilinpäätöksessä. Tulokset tuovat esille merkittäviä yritysten kokemia ongelmia rahoituksen saannissa life science-alalla Suomessa sekä akateemisen yrittäjyyden epäkohtia yritystoiminnan näkökulmasta. Näiden tekijöiden huomioonottaminen ja laajempi kansainvälinen vertailu voivat auttaa suomalaisia yrityksiä tällä vahvalla osaamisalalla eteenpäin.

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