Search results

This study aims to determine whether the stock holdings of equity mutual funds are informative for predicting future stock performance in the Chinese market. It is a puzzle that actively managed mutual funds underperform passive benchmarks, whereas retail investors still delegate investment decisions to the fund managers. The present study sheds light on whether mutual fund managers possess security selection skills in their top ten holdings.

By regression analysis and portfolio sorting, this study focuses on 830 Chinese A-share stocks in the industry research reports from the Guotai Junan Securities Company. It collects mutual fund's top ten holdings data from the Wind Financial Terminal between 2019Q1 and 2021Q1. As robustness checks, the result holds for the fixed-effect model, an additional measure of ranks in the top ten holdings, the predictability test based on the confusion matrix and two stage least square (2SLS) regression.

The authors find that the top ten holdings by equity mutual funds are informative for predicting stock performance and can provide valuable information for investors to support their decision-making.

The findings of this study provide insightful guidance for retail investors in making investment decisions and support the hypothesis that active fund management adds value.

Firstly, the authors find that the top ten holdings of Chinese mutual funds show significantly positive signals for future stock excess returns, indicating the selection skills of fund managers. Secondly, the above positive relationship exhibits a diminishing marginal effect with more funds holding this stock. Thirdly, the authors find that the predictability horizon of the number of overweighing funds is up to three quarters and then diminishes in the fourth quarter. Finally, investors have a 59% prediction accuracy for the whole stock sample and an 85% precision conditional on the predicted positive subsample to outperform the market. The authors also address the endogeneity and reverse causality issues.

This study proposes a framework based on salience theory and shows that focusing on one type of risk (idiosyncratic or systemic) can explain overpricing of securities ex ante, and resales at low prices during crisis periods.

The author consider an overlapping generations (OLG) model where each generation lives for two periods and there is no population growth. Agents (investors) start their lives with an endowment W > 0 and have mean-variance utility. They invest their endowment when young and consume when old. Each period, the young investors optimally choose their portfolio from different risky assets acquired from the old generation, all assumed to be in fixed supply.

The author show that investor salience bias can explain excess volatility of asset prices and the resulting fire-sales in periods of financial turmoil. A change in salience – from one component (idiosyncratic) to the other (systemic) – will generate excess volatility. Interestingly, higher risk aversion generally exacerbates the excess volatility of prices. Moreover, the model predicts that if a big systemic shock hits the financial system, due to salience bias the price of systemic assets falls sharply. This relates to the observed fire-sales of assets during the global financial crisis.

The proposed model and results suggest that there may be a scope for intervention in financial markets during turbulences. In terms of ex ante policies the study suggests that investors and regulator should use better risk assessment technologies.

This is the first study constructing a tractable model based on the argument that investor salience may exacerbate the excess volatility of prices during financial downturns. The author relate salience to two types of risk; idiosyncratic and systemic and assume that investors' risk perception is biased towards the type of risk that is currently salient based on prior beliefs or past data. The author show that the diversification fallacy of the precrisis period, where seemingly safe assets were overpriced, can be explained by agents overweighing idiosyncratic risk and ignoring systemic risk.

This study proposes the use of cumulative prospect theory (CPT) to predict over- and under-estimation of risks and the counteractive adjustment in a cold chain context. In particular, the purpose of this paper is to address the importance of the socio-demographic characteristics of an individual in influencing risk attitude and the analysis of measurable risk probability.

This study uses CPT as the basis to develop a decision analysis model in which the two functions of value editing and probability weighting are nonlinear to adequately determine the flexible risk attitudes of individuals, as well as their prospects with numerous outcomes and different probabilities. An experiment was conducted to obtain empirical predictions, and an efficient Markov Chain Monte Carlo algorithm was applied to overcome the nonlinearity and dimensionality in the process of parameter estimation.

The respondents overweigh the minor cold chain risks with small probabilities and behave in a risk-averse manner, while underweighting major events with larger ones, thereby leading to risk-seeking behavior. Judgment distortion regarding probability was observed under risk decision with a low probability and a high impact. Moreover, the findings indicate that factors, such as gender, job familiarity and confidentiality significantly influence the risk attitudes and subjective probability weighting of the respondents.

The findings fit the framework of CPT and extend this theory to deal with human risk attitudes and subjective bias in cold chains. In particular, this study enhances the literature by providing an analysis of cold chain risk from both the human decision-making and managerial perspectives. Moreover, this research determined the importance of the socio-demographic characteristics of an individual to explain the variability in risk attitudes and responses.

Managers must consider the issues of flexible risk attitude and subjective judgment when making choices for risk mitigation strategies. Given the focus on counteractive adjustment for over- and under-estimated risk, firms could evaluate cold chain risk more accurately, and thereby enhance their resilience to risky events while reducing the variability of their performance.

The current study is the first to materialize the phenomena of over- and under-estimation of cold chain risks, as well as to emphasize the different characteristics for loss aversion and judgment distortion at the individual level.

The EU prudential regime for investment firms comprising the Directive (EU) 2019/2034 (IFD) and Regulation (EU) 2019/2033 (IFR) introduces a fit-for-purpose capital framework for investment firms. The capital impact on the practice of investment management can be material depending on firms’ specific business models and risk profiles, which may require them to take strategic decisions with respect to the services they provide. Despite the importance of this issue for the practice of investment management, there exists no study among the existing studies that focuses on this issue. This study aims to fill this gap in the literature.

This paper reviews the calibration approaches the European Banking Authority (EBA) has used by exploring the deficiencies of the regime with respect to the calibration of categorization thresholds and coefficients that are used by the EBA to calculate regulatory capital requirements.

This paper sets out that the choice of the relevant percentile for setting the firm categorization thresholds was not based on any theoretical rule. It also discusses that the calibration of the K-factors was subjective and lacked consistency. In addition, it criticizes the sample that the EBA used for business model coverage on the grounds that it was unbalanced, resulting in certain K-factors driving the overall capital impact.

Further research is needed on the calibration of thresholds as this will remain a crucial factor for the effectiveness of the new regime. In particular, a more data-driven and transparent approach would be necessary to ensure the accuracy and consistency of the thresholds.

This paper leads to the policy implication that, despite its merits that overweigh its shortcomings, potential market competition and financial stability issues that may stem from inconsistencies and a general lack of objectivity in certain aspects of the regime should not be underestimated by the EU policy makers.

The present paper contributes to the existing knowledge primarily by reviewing the EBA’s calibration approaches with respect to the K-factor coefficients and firm categorization thresholds, concluding that lack of objectivity and precision in the relevant methodologies could distort capital allocation decisions in the practice of investment management.

In the past few years, the concept of competitiveness developed by the World Economic Forum has become the focal point. Global competitiveness index (GCI) presents the constructs which are possible means of productivity of the country. The purpose of this study is to explore whether boosting the productivity of agriculture, services and industry sector is the possible channel of competitiveness leading to growth.

For this, panel GMM moderator model has been used for 16 low-income countries.

The results indicate that competitiveness helps agriculture and industry sector to become more growth productive, while it reduces the productivity of services sector.

This study urges that the gains from following the competition promotion policies overweigh the costs. Hence, low-income countries can break the low productivity trap.

Building on evolutionary emancipation theory, the purpose of this study is to investigate the impact of workplace fun on employees’ scouting behavior through the serial mediation of employees’ psychological empowerment and megaphoning.

A questionnaire survey technique is used to elicit the responses of 445 employees from service organizations.

The statistical results revealed that fun at work influences employees scouting behavior through the serial mediation of psychological empowerment and megaphoning. The direction relationship between fun and scouting was not statistically significant, thus a full mediation mechanism was proved.

The value of employees’ communication behavior has increased in the recent past, and it overweighs the conventional mediums (e.g. TV, radio and newspaper). But the antecedents and mechanisms through which communication behavior can be influenced are an area that has not gained researchers’ attention. This study proposes such a conceptual model and empirically tests it.

Many consumers express interest in plant-based meat alternatives (PBMA); however, they are reluctant to change their meat consumption behaviour. To support the transition to a “meat-free” diet, it is necessary to understand the influencing factors to purchase PBMA. This study responds to a gap in the literature and aims to explore the factors influencing Chinese consumers' willingness to purchase PBMA in terms of “Capability, Motivation and Opportunity”.

Cross-sectional data were collected through an online survey in China (n = 591). Correlation testing and multiple linear regression were used to identify factors that may influence consumers' willingness to purchase PBMA by applying the COM-B model; which refers to Capability (C), opportunity (O), and motivation (M) as three key factors capable of changing behaviour (B).

The results show that consumers with better income and education are more likely to consume PBMA. Familiarity with purchasing channels and cooking knowledge were “capability” catalyst for purchase intentions; support from people around and who also consume PBMA provided opportunities; animal welfare, food safety, sustainability and emotional benefits were motivating factors for facilitation. With capabilities and opportunities, consumers are more likely to be motivated to purchase PBMA. It was also clear, environmental support and appropriate purchasing conditions overweigh knowledge and previous experience in motivating PBMA purchase. Additionally, the study found that familiarity, past experience, high status symbols of meat and health concerns were positively associated with but did not affect purchase intentions (p > 0.05).

The current study did not find a substitution effect for PBMA, as participants tended to consider PBMA as a type of meat and did not substitute it for their daily meat consumption unless motivated.

This study provides a theoretical framework and insights for future research, and production companies can develop marketing initiatives based on the contributing factors using the COM-B model.

Taking cues from the fact that there remains a dearth in the establishment of theoretical and empirical relationship between executive compensation and corporate social responsibility (CSR) performance of the firms, this study attempts to explore the non-linear relationship between the said variables.

The study utilizes a strongly balanced panel data set of 179 non-financial National Stock Exchange (NSE) 500 listed firms for the study period of 2015–2020. The study further employs both static as well as Arellano-Bond dynamic panel model under generalized method of moments (GMM) framework to establish the relationship between executive compensation and CSR performance of the sampled firms.

The study acknowledges an inverted U-shaped relationship between executive compensation and environmental, social and governance (ESG) score of the firms. According to the robust estimator, an increase in the level of executive compensation is said to affect CSR performance positively until it surpasses a threshold level of 18.7 percent.

One of the major takeaways that the study provides for the corporate policymakers is that the level of compensation can only motivate the executives to take up socially responsible work up to a certain level surpassing which the executives becomes resistant towards any benefits provided by the CSR performance and get inclined towards economical performances of the firm. At the later stage, the economical expansionary investment benefits overweigh the personal career benefit gained by the executives from the CSR performances of the firm.

The nonlinearity relationship between executive compensation and CSR performance and the threshold level providing the two-fold effect of compensation on the CSR performance of the firms attempted by this study is a rare attempt in an emerging economy like India.

In the mid 1970s two psychologists, Kahneman and Tversky, isolated three major aspects of heuristics which induce biases in our decisions, which they termed as: (1) representativeness, (2) availability and (3) anchoring. An example of the bias within the representativeness heuristic is the underutilization of base rates. Decision makers tend systematically to overweigh current information and underweigh background information (prior probabilities) relative to what Bayes′ theorem implies. Bias in the availability heuristic is observed for instance in the area of government regulation. Proponents of increasing government regulation of business consider the benefits of eliminating the relatively small number of observed abuses but do not consider the large number of cases where the current system has worked. Decision makers exhibit a tendency to concentrate on extremes rather than means. This is because extremes are more readily available to retrieve from our mental set (mind) than means. On the anchoring heuristic, it is noticed that people allow their decisions to be distorted by the presence of points of reference that should be irrelevant. Discusses biases associated with one particular activity which is important to bank marketing officials, i.e. assessing creditworthiness, and substantiates such a bias using empirical findings.

Excessive high caloric and nutritional intake has been associated with weight gain which is linked to an increased prevalence of cardiovascular disease, type 2 diabetes and several types of cancers. The purpose of this paper is to characterize the nutritional intake pattern of the population in terms of energy, macro and micronutrients.

There were assessed 513 workers of the University of Porto (UP) randomly selected. The Food Processor Plus was used to convert foods into nutrients and, to assess nutritional intake adequacy. Data were compared to Dietary Reference Intakes and with recommended ranges by the World Health Organization.

The intake of most individuals was above recommendations for protein, carbohydrates and sodium. The average of energy intake observed in UP employees was lower than data available for Portuguese general population. The protein, carbohydrates, total fat and water intake, cholesterol, saturated, monounsaturated, polyunsaturated fatty acids and sodium intake were found to be significantly higher for men. Significant differences were found for vitamin D and calcium between age ranges; Carbohydrates, sugar, monounsaturated fatty acids, cholesterol, water and vitamin K was significantly different between teachers and non-teachers.

According to nutritional intake analysis, food consumption of this population was unbalanced, attending to high protein, carbohydrates and sodium intake.