1173 Posts Found

For companies seeking the safe haven of private life, both promises and peril await.

Editor’s Note: see related article, “Opting Out”
Content: Article | Author: Erik Sherman | Source: Chief Executive | Subject: Finance

The field of social-purpose investing is growing and becoming more sophisticated. Should investors expect lower returns to benefit society? A new Harvard Business School study examines the question.

Content: Article | Author: Manda Salls | Source: Harvard Business School (HBS) Working Knowledge | Subjects: Finance, Social Responsibility (ESG) | Industry: Investing

Khanna, Palepu, and Srinivasan examine the relatively new S&P Transparency and Disclosure scores for 466 firms from Asian-Pacific countries. Consistent with theory, they find that the more the interaction with US firms, the more transparent the firm’s disclosure practices. Specifically they find “a positive association between these disclosure scores and the following types of market interactions: business operations in the US, US listing, … [ Read more ]

Content: Article | Authors: Krishna Palepu, Suraj Srinivasan, Tarun Khanna | Source: Social Science Research Network (SSRN) | Subjects: Finance, International

When no precedent exists to guide analysts in assessing the value of an alliance, the task of justifying a price to shareholders falls to those who lead the deal. A clear, strategic vision, well-articulated and linked to rigorous valuation and informed negotiation, will be a strong predictor of success.

Content: Article | Authors: Dan Haas, Geoff Cullinan, Orit Gadiesh | Source: Bain & Company | Subject: Finance

Companies keep driving into the same traps in the budgeting process. The fallout can be serious in boom times; in the current economic climate, foibles can take an organization so far off course that it never gets back into the game. Here are the most common traps – from no-brainers to complex pitfalls – and tips for sidestepping them.

Content: Article | Author: Tad Leahy | Source: Business Finance Magazine | Subjects: Finance, Management

Investors have long exhibited a “home country bias” whereby they hold more shares of firms from their own country than would seem warranted based off of typical diversification theory. This seeming anomaly has been partially explained in many ways (my favorite is Butler’s view that when markets fall, the correlation is actually greater than the long run correlation, hence overstating the value of diversification). … [ Read more ]

Content: Article | Author: Kai Li | Source: Social Science Research Network (SSRN) | Subjects: Finance, International | Industry: Investment Banking

Since the days of the industrial revolution, companies have struggled with the issue of what to do with their unused assets.

Recently, the idea of selling idle or obsolete assets – so-called “asset disposition”- has grown in popularity as companies recognize the extent of their equipment stockpiles and their potential value. The idea of selling idle assets is further spurred by rapidly evolving B2B (business-to-business)Internet … [ Read more ]

Content: Article | Source: Kearney | Subjects: Finance, Operations

This one is a must for any investment class! Jegadeesh, Kim, Krische, and Lee provide a fascinating look at investment analysts. They study stock analyst recommendations. Some of their findings are that analysts tend to prefer glamour stocks (higher growth and with momentum), and firms with whom the analyst’s firm has an investment banking relationship. Additionally, changes in analyst recommendations tend … [ Read more ]

Content: Article | Authors: Charles M. C. Lee, Joonghyuk Kim, Narasimhan Jegadeesh, Susan D. Krische | Source: Journal of Finace (JF) | Subjects: Finance, Industry Specific | Industry: Investment Banking

The discipline of project management is dedicated to improving the odds that every undertaking is completed within a set time frame and budget and that it achieves an acceptable level of quality. Project managers must know how to apply the right balance of knowledge, skills, tools and techniques to the myriad activities required to reach the specified goals. However, many companies do not give project … [ Read more ]

Content: Article | Author: Joanne Sammer | Source: Business Finance Magazine | Subjects: Finance, Project Management

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“Decimalization” – the pricing of stocks in dollars and cents instead of fractions – lauded by proponents to be a good thing for investors when it was adopted by the U.S. stock markets in early 2001, is under fire. Critics say it costs institutional investors big. But in a study co-authored by Venkatesh Panchapagesan, assistant professor of finance at Olin, direct institutional trading costs appear … [ Read more ]

Content: Article | Author: Venkatesh Panchapagesan | Source: Discovery@Olin | Subject: Finance | Industry: Finance / Banking

At the heart of best practice in purchasing is a set of skills. One of the most important is the one that enables managers to understand what determines cost.

Content: Article | Authors: Julie A. Ask, Timothy M. Laseter | Source: strategy+business | Subjects: Best Practices, Finance

This article models (and tests!) the bid/ask spread of stock trades and models it as a function of “minimum tick size, order-processing costs, inventory holding costs, adverse selection costs, and competition.” VERY cool. And the model even seems to work empirically! [FinanceProfessor.com Annotation]

Content: Article | Authors: Nicholas P.B. Bollen, Robert E. Whaley, Tom Smith | Source: Journal of Financial Economics | Subjects: Finance, Industry Specific | Industry: Investment Banking

An entry in the new Harvard Business Essentials series, this primer is designed to introduce non-financial managers to business finance. Short chapters define and describe the basic elements of financial statements, accounting, taxes, venture capitalization, budgeting, decision and investment analysis, and business valuation in layman’s terms.

Content: Book | Authors: Richard Luecke, Samuel Hayes | Subject: Finance

Aspirations run into limitations, but multinational treasuries push forward in the race toward world-class status.

Content: Article | Author: Richard H. Gamble | Source: Business Finance Magazine | Subjects: Finance, International

Pastor and Veronsi explain IPO waves by creating a model of “optimal IPO timing.” Their model predicts that firms will be more willing to issue shares when the required returns are lower, when the firm’s expected cash flows are higher (which could be interpreted at there being more positive investment opportunities-and therefore likely a greater need for cash), and “when the uncertainty surrounding … [ Read more ]

Content: Article | Authors: Lubos Pastor, Pietro Veronesi | Source: University of Chicago | Subjects: Finance, Industry Specific | Industry: Investment Banking

If you want to know where your money goes, get ready to master the concept of TCO.

Content: Article | Authors: John Taylor Bailey, Stephen R. Heidt | Source: Darwin Magazine | Subjects: Finance, IT / Technology / E-Business

Westerholm, Swan, and Liu look at how market design impacts how the market operates. That is, there is a tradeoff between transaction costs and volatility. Having dealers available to trade continually increases expenses, which in turn lead to larger spreads (transaction costs) for these so-called continuous dealer markets. On the other hand in return for these larger spreads, the dealers do help … [ Read more ]

Content: Article | Authors: P. Joakim Westerholm, Peter L. Swan, Stella Liu | Source: Social Science Research Network (SSRN) | Subjects: Finance, Industry Specific | Industry: Investment Banking

Although they work in the heyday of systems integration, today’s cash forecasters confront a gap between what their ERP systems know and what their treasury workstations tell them to base predictions on.

Content: Article | Author: Richard H. Gamble | Source: Business Finance Magazine | Subject: Finance

A stock split occurs when a company changes the number of shares it has outstanding. For example, suppose the firm had 1 million shares outstanding and then announced a 2:1 split. The firm would now have 2 million shares outstanding. It is not surprising that the stock price drops after the split, but what continues to leave researchers puzzled is why there … [ Read more ]

Content: Article | Authors: Ning Zhu, Ravi Dhar, William N. Goetzmann | Source: Social Science Research Network (SSRN) | Subjects: Finance, Industry Specific | Industry: Investment Banking