Executive Stock Options: Exercise Policy and Market Reaction

In this paper I investigate the exercise policy, and the market reaction to that, of the executive stock option holders in Finland. The empirical tests are conducted with aggregated firm level data from 34 firms and 41 stock option programs. I find some evidence of an inverse relation between the exercise intensity of the options holders and the future abnormal return of the company share price. This finding is supported by the view that information about future company prospect seems to be the only theoretical attribute that could delay the exercise of the options. Moreover, a high concentration of exercises in the beginning of the exercise window is predicted and the market is expected to react to deviations from this. The empirical findings however show that the market does not react homogenously to the information revealed by the late exercises.

Share Repurchases, Dividends, and Executive Options

This paper reports empirical results on the determinants of the authorization decision for share repurchases and dividends in Finland. We use a data set with precise data on share repurchases as well as characteristics for the option programs. Contrary to the U.S., we use a data set where 41% of the options are dividend protected, which allows us to separate between the "option funding" and "substitution / managerial wealth" hypothesis for the choice of the distribution method. We find that foreign ownership is the main determinant for share repurchases in Finland and attribute this relationship to tax factors. We also find evidence in support of both the signaling and agency cost hypotheses for cash distributions, especially in the case of share repurchases. Finally, we find a significant difference between companies with and without dividend protected options. When options are dividend protected, the relationship between dividend distributions and the scope of the options program turns to a significantly positive one instead of the negative one documented on U.S. data. This gives some support for the substitution / managerial wealth hypothesis as a determinant for the choice of the distribution method.

Double diffusive unsteady free convection on two-dimensional and axisymmetric bodies in a porous medium

The unsteady laminar free convection flow of an incompressible electrically conducting fluid over two-dimensional and axisymmetric bodies embedded in a highly porous medium with an applied magnetic field has been studied. The unsteadiness in the flow field is caused by the variation of the wall temperature and concentration with time. The coupled nonlinear partial differential equations with three independent variables have been solved numerically using an implicit finite-difference scheme in combination with the quasilinearization technique. It is observed that the skin friction, heat transfer and mass transfer increase with the permeability parameter but decrease with the magnetic parameter. The results are strongly dependent on the variation of wall temperature and concentration with time. The skin friction and heat transfer increase or decrease as the buoyancy forces from species diffusion assist or oppose the thermal buoyancy force. However, the mass transfer is found to be higher for small values of the ratio of the buoyancy parameters than for large values

Unsteady mixed convection over two-dimensional and axisymmetric bodies

The unsteady laminar incompressible mixed convection flow over a two-dimensional body (cylinder) and an axisymmetric body (sphere) has been studied when the buboyancy forces arise from both thermal and mass diffusion and the unsteadiness in the flow field is introduced by the time dependent free stream velocity. The nonlinear partial differential equations with three independent variables governing the flow have been solved numerically using an implicit finite-difference scheme in combination with the quasilinearization technique. The results indicate that for the thermally assisting flow the local skin friction, heat transfer and mass diffusion are enhanced when the buoyancy force from mass diffusion assists the thermal buoyancy force. But this trend is opposite for the thermally opposing flow. The point of zero skin friction moves upstream due to unsteadiness. No singularity is observed at the point of zero skin friction for unsteady flow unlike steady flow. The flow reversal is observed after a certain instant of time. The velocity overshoot occurs for assisting flows.

Injection cooling of blunt bodies flying at high Mach numbers

A study of transpiration cooling of blunt bodies such as a hemicylinder is made by solving Navier-Stokes equations. An upwind, implicit time-marching code is developed for this purpose. The study is conducted for both perfect-gas and real-gas (chemical equilibrium) flows. Investigations are carried out for a special wall condition that is referred to as no heat flow into the wall condition. The effects of air injection on wall temperature are analyzed. Analyses are carried out for Mach numbers ranging between 6-10 and Reynolds numbers ranging between 10(6)-10(7). Studies are made for spatially constant as well as spatially varying mass injection rate distributions, White cold air injection reduces the wall temperature substantially, transpiration cooling is relatively less effective when the gas is in chemical equilibrium.

Shock tunnel study of spiked aerodynamic bodies flying at hypersonic Mach numbers

A three-component accelerometer balance system is used to study the drag reduction effect of an aerodisc on large angle blunt cones flying at hypersonic Mach numbers. Measurements in a hypersonic shock tunnel at a freestream Mach number of 5.75 indicate more than 50% reduction in the drag coefficient for a 120degrees apex angle blunt cone with a forward facing aerospike having a flat faced aerodisc at moderate angles of attack. Enhancement of drag has been observed for higher angles of attack due to the impingement of the flow separation shock on the windward side of the cone. The flowfields around the large angle blunt cone with aerospike assembly flying at hypersonic Mach numbers are also simulated numerically using a commercial CFD code. The pressure and density levels on the model surface, which is under the aerodynamic shadow of the flat disc tipped spike, are found very low and a drag reduction of 64.34% has been deduced numerically.

Solar energy decision support system

Energy plays a prominent role in human society. As a result of technological and industrial development,the demand for energy is rapidly increasing. Existing power sources that are mainly fossil fuel based are leaving an unacceptable legacy of waste and pollution apart from diminishing stock of fuels.Hence, the focus is now shifted to large-scale propagation of renewable energy. Renewable energy technologies are clean sources of energy that have a much lower environmental impact than conventional energy technologies. Solar energy is one such renewable energy. Most renewable energy comes either directly or indirectly from the sun. Estimation of solar energy potential of a region requires detailed solar radiation climatology, and it is necessary to collect extensive radiation data of high accuracy covering all climatic zones of the region. In this regard, a decision support system (DSS)would help in estimating solar energy potential considering the region’s energy requirement.This article explains the design and implementation of DSS for assessment of solar energy. The DSS with executive information systems and reporting tools helps to tap vast data resources and deliver information. The main hypothesis is that this tool can be used to form a core of practical methodology that will result in more resilient in time and can be used by decision-making bodies to assess various scenarios. It also offers means of entering, accessing, and interpreting the information for the purpose of sound decision making.

Ecological Assessment of Lentic Water Bodies of Bangalore

The restoration, conservation and management of water resources require a thorough understanding of what constitutes a healthy ecosystem. Monitoring and assessment provides the basic information on the condition of our waterbodies. The present work details the study carried out at two waterbodies, namely, the Chamarajasagar reservoir and the Madiwala Lake. The waterbodies were selected on the basis of their current use and locations. Chamarajasagar reservoir serves the purpose of supplying drinking water to Bangalore city and is located on the outskirts of the city surrounded by agricultural and forest land. On the other hand, Madiwala lake is situated in the heart of Bangalore city receiving an influx of pollutants from domestic and industrial sewage. Comparative assessment of the surface water quality of both were carried out by instituting the various physico–chemical and biological parameters. The physico-chemical analyses included temperature, transparency, pH, electrical conductivity, dissolved oxygen, alkalinity, total hardness, calcium hardness, magnesium hardness, nitrates, phosphates, sodium, potassium and COD measurements of the given waterbody. The analysis was done based on the standard methods prescribed (or recommended) by (APHA) and NEERI. The biological parameter included phytoplankton analysis. The detailed investigations of the parameters, which are well within the tolerance limits in Chamarajasagar reservoir, indicate that it is fairly unpolluted, except for the pH values, which indicate greater alkalinity. This may be attributed to the natural causes and the agricultural runoff from the catchment. On the contrary, the limnology of Madiwala lake is greatly influenced by the inflow of sewage that contributes significantly to the dissolved solids of the lake water, total hardness, alkalinity and a low DO level. Although, the two study areas differ in age, physiography, chemistry and type of inflows, they still maintain a phytoplankton distribution overwhelmingly dominated by Cyanophyceae members,specifically Microcystis aeruginosa. These blue green algae apparently enter the waterbodies from soil, which are known to harbour a rich diversity of blue green flora with several species common to limnoplankton, a feature reported to be unique to the south Indian lakes.Chamarajasagar water samples revealed five classes of phytoplankton, of which Cyanophyceae (92.15 percent) that dominated other algal forms comprised of one single species of Microcystis aeruginosa. The next major class of algae was Chlorophyceae (3.752 percent) followed by Dinophyceae (3.51 percent), Bacillariophyceae (0.47 percent) and a sparsely available and unidentified class (0.12 percent).Madiwala Lake phytoplankton, in addition to Cyanophyceae (26.20 percent), revealed a high density of Chlorophyceae members (73.44 percent) dominated by Scenedesmus sp.,Pediastrum sp., and Euglena sp.,which are considered to be indicators of organic pollution. The domestic and industrial sewage, which finds its way into the lake, is a factor causing organic pollution. As compared to the other classes, Euglenophyceae and Bacillariophyceae members were the lowest in number. Thus, the analysis of various parameters indicates that Chamarajasagar reservoir is relatively unpolluted except for the high percentage of Microcystis aeruginosa, and a slightly alkaline nature of water. Madiwala lake samples revealed eutrophication and high levels of pollution, which is clarified by the physico–chemical analysis, whose values are way above the tolerance limits. Also, the phytoplankton analysis in Madiwala lake reveals the dominance of Chlorophyceae members, which indicate organic pollution (sewage being the causative factor).