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Article
Publication date: 1 February 2004

Jan Bentzen and Valdemar Smith

Auctions of selected wines have regularly taken place internationally and from natural reasons they have mostly involved the finest wines as e.g. the top wines from…

Abstract

Auctions of selected wines have regularly taken place internationally and from natural reasons they have mostly involved the finest wines as e.g. the top wines from Bordeaux. In order to analyse specific auction wine prices, the Mouton Rothschild (Medoc Premier Cru Classé) has been selected for investigation, where auction data have been collected from the USA (The Chicago Wine Company), Denmark (Bruun Rasmussen, Selected Wines Auctions) and from other sources as well. The price development of this specific icon wine is expected to be influenced by many factors, although theoretically, investment decisions concerning e.g. icon wines, ought not to be highly sensitive to short‐run business conditions. The empirical findings exhibit that the auction prices of the Mouton Rothschild differ relatively much between the auction houses, and the time series analysis reveals only weak evidence of co‐movements between wine prices and selected business cycle indicators.

Details

International Journal of Wine Marketing, vol. 16 no. 2
Type: Research Article
ISSN: 0954-7541

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Article
Publication date: 21 August 2017

Fang Wang and Xu Zheng

The purpose of this paper is to construct a price index for Chinese oil paintings and analyze the financial performance of investing in Chinese oil paintings and its…

Abstract

Purpose

The purpose of this paper is to construct a price index for Chinese oil paintings and analyze the financial performance of investing in Chinese oil paintings and its potential for portfolio diversification in Chinese financial markets.

Design/methodology/approach

A hedonic regression model is applied to construct a semiannual price index for Chinese oil paintings from 2000 to 2014. The CAPM model, downside β and standard portfolio optimization are used for analyzing portfolio diversification.

Findings

The hedonic regression shows that the majority of hedonic variables, such as dimension, artist’s reputation, living status, medium and auction houses, are statistically significant in estimation. Not only the return from oil painting investments is higher than other equities, but also the β coefficient of the CAPM model and downside β indicate that Chinese oil painting may be a good hedging instrument against stock market risk. Furthermore, the portfolio optimizations under standard assumptions suggest that oil paintings as an alternative investment provide diversification benefit.

Originality/value

This paper provides a new and comprehensive analysis of characteristics and risks of investing in the Chinese oil paintings.

Details

China Finance Review International, vol. 7 no. 3
Type: Research Article
ISSN: 2044-1398

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Article
Publication date: 16 March 2015

Denton Marks and David M. Welsch

Commercial auctions of cultural goods are typically brokerage arrangements where potential buyers may consider pre-sale estimates (PSEs) in bidding. The economic theory…

Abstract

Purpose

Commercial auctions of cultural goods are typically brokerage arrangements where potential buyers may consider pre-sale estimates (PSEs) in bidding. The economic theory suggests that PSEs should provide honest guidance – winning bids should, on average, equal PSEs – but available research from fine art and antique auctions finds otherwise. The authors examine this relationship for commercial auctions of fine wine – items which, unlike fine art and antiques, are widely traded so that bidders may more knowledgably interpret PSEs.

Design/methodology/approach

The paper examines the relationship of PSEs to winning bids econometrically for an iconic wine widely traded in several Chicago wine auctions, a novel setting for this analysis.

Findings

The relationship of winning bids to PSEs differs significantly between two neighboring auction houses, perhaps reflecting differences in how they do business; neither’s PSEs have a straightforward relationship to winning bids; PSEs have an influence on winning bids independent of a lot’s characteristics, reflecting perhaps an anchoring effect; the analysis suggests broad bidding strategies (with counter-strategies implied) and might guide auction house lot selection and ownership if more complete data became available.

Originality/value

The role and reliability of PSEs in auctions of other cultural goods, representing most of the literature, has limited application to auctions of fine wine whose markets differ categorically from those of other cultural goods.

Details

International Journal of Wine Business Research, vol. 27 no. 1
Type: Research Article
ISSN: 1751-1062

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Article
Publication date: 1 January 1995

Stephen R.C. Wanhill

Examines the information determinants on the hammer price of a remarkable collection often vintages of Château Léoville‐Barton, spanning 1981–90, which came up for auction…

Abstract

Examines the information determinants on the hammer price of a remarkable collection often vintages of Château Léoville‐Barton, spanning 1981–90, which came up for auction at Christie's, South Kensington, during the early part of 1994. The vintage ratings of three leading wine writers and the Christie's guide prices were modelled as predictions of the hammer price. The results indicated that the auctioneer's guide prices had greatest explanatory power in terms of the variation in the hammer prices, but the vintage ratings provided by the wine authors were also significant

Details

International Journal of Wine Marketing, vol. 7 no. 1
Type: Research Article
ISSN: 0954-7541

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Article
Publication date: 1 August 2016

Terence Y.M. Lam and Malvern Tipping

Sale-and-leaseback has become an increasingly common approach during the last two decades in the investment of high street banks (banking-halls) in the UK. One measure…

Abstract

Purpose

Sale-and-leaseback has become an increasingly common approach during the last two decades in the investment of high street banks (banking-halls) in the UK. One measure commonly used in making property investment decisions is the all risks yield (ARY) which is associated with the level of rental income. Investors and their advisors need to know which factors are likely to result in the highest ARY when assembling investment portfolios of such properties. The purpose of this paper is to identify those yield influences.

Design/methodology/approach

A qualitative multiple-case study was adopted. A literature review generated a hypothesis which was tested by a qualitative study, based upon semi-structured interviews and a questionnaire, to establish the influencing factors. Expert interviews were held with the heads of those three major auction-houses dealing with auctions of all retail bank premises in the Great Britain market, whilst the questionnaire survey involved investment professionals from within the auction-houses.

Findings

The study confirmed that the four factors influencing yields and investors’ decision-making when purchasing retail banking premises were tenant banking company (brand names), regional location (north and south super-regions), lot size (hammer price), and tenure (freehold or leasehold).

Research limitations/implications

This investigation focuses on Great Britain’s geographical and political area which includes England, Scotland and Wales, but excludes Northern Ireland. This research focuses on banking-halls as a sub-class of retail property investment. The findings form a baseline upon which further research can be conducted on other sub-types of retail property such as high street shops and retail parks. The results will also underpin the development of a quantitative yield predictive model based on regression analysis.

Practical implications

To maximize the returns on property investments, investors and their professional advisors can use those factors having the greatest influence on yields to make informed investment decisions for the building of property portfolios.

Originality/value

As a sub-sector, bank premises do not necessarily correlate to the generic retail sector. This research consolidates the broad systematic drivers of retail yields into specific factors influencing the ARY of banking-halls. The findings provide better understanding of an active but sparsely analysed sub-market of banking hall investments, and by so-doing help investors to maximize their investment returns.

Details

Journal of Property Investment & Finance, vol. 34 no. 5
Type: Research Article
ISSN: 1463-578X

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Article
Publication date: 12 September 2017

Mouna Sebri and Georges Zaccour

The starting conjecture is that the market share of a brand in one category benefits from its performance in another category, and vice versa. The purpose of this paper is…

Abstract

Purpose

The starting conjecture is that the market share of a brand in one category benefits from its performance in another category, and vice versa. The purpose of this paper is to assess the umbrella-branding spillovers by investigating the presence of synergy effect between categories when a retailer and/or a manufacturer decide to adopt/use the same name for his products. In fact, besides the cross-category dependency due to substitutability or complementarity, products can also be linked through their brand name in presence of an umbrella-branding strategy.

Design/methodology/approach

The authors propose an extended market-share model to account for the spillover effect at the brand level. The spillover is modeled to be generated by the brand's performance and not specific to marketing instruments, as done in the literature. They adopt a multiplicative competitive interaction (MCI) form for the attraction function. Based on aggregated data of two complementary oral-hygiene categories, the authors estimate the umbrella-branding spillover parameters using the iterate three-stage least squares (I3SLS) method. They contrast the results in three scenarios: no spillover, brand-constant spillover and brand-specific spillover.

Findings

The ensuing results indicate that umbrella-branding spillover is (i) significant and positive, i.e. the brand performance is boosted by its performance in a related category, through the so-called brand-attraction multiplier; (ii) asymmetric, i.e. the spillover is not equal in both directions; and associated to the market strength of each competing brand; (iii) variable across brands. The results show that not accounting for umbrella-branding spillover leads to misestimating the parameters and has a considerable impact on price-elasticities computation.

Research limitations/implications

Because store brands and some national brands exist in many categories, and thus because consumers make inferences when they face a large number of brands in different categories, spillover effects cannot be labelled as simply complementary or substitution-related. Future research may provide insight about the spillover phenomenon in a more general framework that would consider the spillover occurring between more than two categories.

Practical implications

Providing accurate assessment for umbrella-branding spillovers governing the competing brands, the results offer a relevant and straightforward method for decision makers to precisely assess the impact of a marketing effort in one category on the retailer's global performance. The findings provide better forecasts of market response in terms of sales and profit, within a cross-category perspective.

Originality/value

This study develops and estimates a market-share model with the aim of measuring brand-category spillover effects. The literature dealt with cross-category interactions in terms of substitutability or complementarity between the products offered in the two or more categories under investigation. Here, the focal point (and contribution) of the authors is the link at the brand level. Indeed, the authors only require that a minimum of one brand is offered in at least two of the categories of interest. Further, the spillover considered is not specific to marketing instruments, but is generated by the brand performance (attraction or market share), which is the result of both the firms marketing-mix choice and competitors marketing policies.

Details

European Journal of Marketing, vol. 51 no. 9/10
Type: Research Article
ISSN: 0309-0566

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Article
Publication date: 7 April 2015

Malvern Tipping and Roger Newton

– This paper aims to build a predictive model for the investment yield of British banking-halls.

Abstract

Purpose

This paper aims to build a predictive model for the investment yield of British banking-halls.

Design/methodology/approach

Empirical data of similar lots sold at previous auctions are subjected to statistical analyses utilizing a cross-sectional research design. The independent variables analysed are taken from a previous study using the same cases. Models are built using logistic regression and ANCOVA.

Findings

Logistic regression generally generates better models than ANCOVA. A division of Britain on a north/south divide produces the best results. Rent is as good as lot size and price in modelling, but has greater utility, because it is known prior to auctions.

Research limitations/implications

Cases analysed were restricted to lots let entirely as banking-halls. Other lots comprising premises only partially used as banking-halls might produce different results. Freehold was the only tenure tested.

Practical implications

The study provides a form of predictive modelling for investors and their advisors using rent which is known in advance of any sale.

Originality/value

The study makes an original contribution to the field, because it builds a predictive model for investment yields for this class of property. Further research may indicate if similar predictive models can be built for other classes of investment property.

Details

Journal of Corporate Real Estate, vol. 17 no. 1
Type: Research Article
ISSN: 1463-001X

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Article
Publication date: 26 July 2018

Rosane Hungria-Gunnelin

This paper aims to empirically test the effect of list price and bidding strategies in ascending auctions of residential real estate.

Abstract

Purpose

This paper aims to empirically test the effect of list price and bidding strategies in ascending auctions of residential real estate.

Design/methodology/approach

Three regression models are estimated, using a unique data set from 629 condominium apartments in the inner-city of Stockholm, Sweden, sold between January 2010 and December 2011.

Findings

The results show that jump bidding has the predicted effect of reducing competition by scaring off bidders. However, a higher average bid increment leads to a higher selling price. Furthermore, results show that a fast auction in terms of average time between bids acts to increase the probability of so-called auction fever as both the number of bidders and the selling price are positively correlated with the speed of the auction. While the average behavior of all auction participants, in terms of jump bidding and time between bids, significantly affects auction outcomes, differences in strategies applied by winners and losers show mixed results. The results of this study with respect to sellers’ list price strategy show that underpricing is an ineffective strategy in terms of enticing more bidders to participate in the auction. Furthermore, underpricing is not sufficient to have a positive effect on the selling price.

Originality/value

This paper is one of the first papers to empirically analyze how different bidding strategies affect the outcome of residential real estate auctions in terms of competition and the final selling price.

Details

Journal of European Real Estate Research, vol. 11 no. 2
Type: Research Article
ISSN: 1753-9269

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Abstract

Details

Marketing Intelligence & Planning, vol. 20 no. 7
Type: Research Article
ISSN: 0263-4503

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Article
Publication date: 1 February 2003

Peter Curwen

During the recent past there have been two successive and successful takeovers of Telecom Italia, in both cases by other Italian companies and employing the device of…

Abstract

During the recent past there have been two successive and successful takeovers of Telecom Italia, in both cases by other Italian companies and employing the device of “Chinese boxes” to secure control without the need either to hold a majority stake in the acquired company or to pay much regard to the interests of minority shareholders. This raises into question the extent to which “Anglo‐Saxon” attitudes in financial markets are making inroads in continental Europe; the willingness of continental European governments to permit foreigners to acquire control of the “commanding heights” of their economies; and the manner in which the European telecommunications sector is being restructured.

Details

European Business Review, vol. 15 no. 1
Type: Research Article
ISSN: 0955-534X

Keywords

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