An Empirical Analysis Of The Effect Of Changes In Interest Rates On Accounting Rates Of Return Growth And Equity Values

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An Empirical Analysis of the Effect of Changes in Interest Rates on Accounting Rates of Return, Growth, and Equity Values

Author : Doron Nissim
Publisher :
ISBN 13 :
Total Pages : 51 pages
Book Rating : 4.:/5 (129 download)

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Book Synopsis An Empirical Analysis of the Effect of Changes in Interest Rates on Accounting Rates of Return, Growth, and Equity Values by : Doron Nissim

Download or read book An Empirical Analysis of the Effect of Changes in Interest Rates on Accounting Rates of Return, Growth, and Equity Values written by Doron Nissim and published by . This book was released on 2011 with total page 51 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines whether the documented negative correlation between changes in interest rates and stock returns is also observed in the fundamentals on which equity values are based. The negative correlation is often attributed to changes in the discount rate, a denominator effect in a valuation model. However, there may also be a numerator effect on the expected payoffs that are discounted, and it is this effect that the paper examines. The paper documents the effect of changes in interest rates on accounting profitability and asset growth that are tied to expected dividends and value in the residual earnings valuation model. The effects of changes in both real and nominal interest rates are investigated so that the effects of changes in expected inflation (that has been the focus of much of the research on interest rates and stock returns) are isolated. Accordingly, the paper evaluates the Modigliani and Cohn conjecture that investors do not understand the effect of changes in expected inflation on firms. The results show that both real and nominal rates are positively related to subsequent profitability and growth, at least in the near term. So, increases in interest rates are followed by higher profitability and growth. However, the resultant increase in earnings is typically not large enough to cover the increase in the required return from the increase in the interest rate. So the overall effect on equity value is negative, consistent with the results of the research on interest rates and stock returns.

International Convergence of Capital Measurement and Capital Standards

Author :
Publisher : Lulu.com
ISBN 13 : 9291316695
Total Pages : 294 pages
Book Rating : 4.2/5 (913 download)

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Book Synopsis International Convergence of Capital Measurement and Capital Standards by :

Download or read book International Convergence of Capital Measurement and Capital Standards written by and published by Lulu.com. This book was released on 2004 with total page 294 pages. Available in PDF, EPUB and Kindle. Book excerpt:

The Association between Changes in Interest Rates, Earnings, and Equity Values

Author : Doron Nissim
Publisher :
ISBN 13 :
Total Pages : 41 pages
Book Rating : 4.:/5 (129 download)

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Book Synopsis The Association between Changes in Interest Rates, Earnings, and Equity Values by : Doron Nissim

Download or read book The Association between Changes in Interest Rates, Earnings, and Equity Values written by Doron Nissim and published by . This book was released on 2011 with total page 41 pages. Available in PDF, EPUB and Kindle. Book excerpt: Numerous studies have documented that stock returns are negatively related to changes in interest rates, but there has been little corroborating research on the information in interest rate changes about the fundamentals which the stock market prices. The negative correlation is often attributed to changes in the discount rate, a denominator effect in a valuation model. However, there may also be a numerator effect on the expected payoffs that are discounted. This paper shows that changes in interest rates are positively related to subsequent earnings, but the change in earnings is typically not large enough to cover the change in the required return. Hence the net (numerator and denominator) effect on equity value is negative, consistent with the results of the research on interest rates and stock returns.

The Relationship of Interest Rates and Stock Returns

Author : Nargiz Nasirova
Publisher :
ISBN 13 :
Total Pages : 77 pages
Book Rating : 4.:/5 (12 download)

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Book Synopsis The Relationship of Interest Rates and Stock Returns by : Nargiz Nasirova

Download or read book The Relationship of Interest Rates and Stock Returns written by Nargiz Nasirova and published by . This book was released on 2015 with total page 77 pages. Available in PDF, EPUB and Kindle. Book excerpt: It is accepted that stock returns are influenced by numerous economic and fundamental factors. This masters thesis aims to investigate the influence of economic factors such as interest rate on stock returns. The thesis explores the theoretical aspects of stock return fluctuations and the factors that influence them, interest rates as an important economic variable, and the interrelation of interest rates and stock returns. In specific, the thesis provides empirical research which examines the relationship between interest rates and stock returns in the Austrian market for the period of October 2004 to August 2014. The empirical part includes an analysis of the effects of six interest rates on stock indices changes in Austria. The research provides empirical evidence of the presence of a positive linear relationship between several interest rates and Austrian stock returns. The explanatory power of regression models increases after adding a market variable. The difference in interest rate sensitivity of different industries is confirmed. The results of this research are in line with the results of previous studies.*****It is accepted that stock returns are influenced by numerous economic and fundamental factors. This masters thesis aims to investigate the influence of economic factors such as interest rate on stock returns. The thesis explores the theoretical aspects of stock return fluctuations and the factors that influence them, interest rates as an important economic variable, and the interrelation of interest rates and stock returns. In specific, the thesis provides empirical research which examines the relationship between interest rates and stock returns in the Austrian market for the period of October 2004 to August 2014. The empirical part includes an analysis of the effects of six interest rates on stock indices changes in Austria. The research provides empirical evidence of the presence of a positive linear relationship between several interest rates and Austrian stock returns. The explanatory power of regression models increases after adding a market variable. The difference in interest rate sensitivity of different industries is confirmed. The results of this research are in line with the results of previous studies.

The Effect of Refunding Decisions on the Relationship Between Interest Rates and Stock Prices

Author : Sang-hun Kim
Publisher :
ISBN 13 :
Total Pages : 314 pages
Book Rating : 4.:/5 (89 download)

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Book Synopsis The Effect of Refunding Decisions on the Relationship Between Interest Rates and Stock Prices by : Sang-hun Kim

Download or read book The Effect of Refunding Decisions on the Relationship Between Interest Rates and Stock Prices written by Sang-hun Kim and published by . This book was released on 1979 with total page 314 pages. Available in PDF, EPUB and Kindle. Book excerpt:

An Empirical Analysis of Stock Returns, Inflation, and Interest Rates in the Pacific-Basin Countries

Author : Osamah Mohammad Alkhazali
Publisher :
ISBN 13 :
Total Pages : 284 pages
Book Rating : 4.:/5 (548 download)

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Book Synopsis An Empirical Analysis of Stock Returns, Inflation, and Interest Rates in the Pacific-Basin Countries by : Osamah Mohammad Alkhazali

Download or read book An Empirical Analysis of Stock Returns, Inflation, and Interest Rates in the Pacific-Basin Countries written by Osamah Mohammad Alkhazali and published by . This book was released on 1997 with total page 284 pages. Available in PDF, EPUB and Kindle. Book excerpt:

The Analysis and Use of Financial Statements

Author : Gerald I. White
Publisher : John Wiley & Sons
ISBN 13 : 0471375942
Total Pages : 786 pages
Book Rating : 4.4/5 (713 download)

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Book Synopsis The Analysis and Use of Financial Statements by : Gerald I. White

Download or read book The Analysis and Use of Financial Statements written by Gerald I. White and published by John Wiley & Sons. This book was released on 2002-12-30 with total page 786 pages. Available in PDF, EPUB and Kindle. Book excerpt: Accounting Standards (US and International) have been updated to reflect the latest pronouncements. * An increased international focus with more coverage of IASC and non-US GAAPs and more non-US examples.

Handbook of Fixed-Income Securities

Author : Pietro Veronesi
Publisher : John Wiley & Sons
ISBN 13 : 1118709195
Total Pages : 630 pages
Book Rating : 4.1/5 (187 download)

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Book Synopsis Handbook of Fixed-Income Securities by : Pietro Veronesi

Download or read book Handbook of Fixed-Income Securities written by Pietro Veronesi and published by John Wiley & Sons. This book was released on 2016-04-04 with total page 630 pages. Available in PDF, EPUB and Kindle. Book excerpt: A comprehensive guide to the current theories and methodologies intrinsic to fixed-income securities Written by well-known experts from a cross section of academia and finance, Handbook of Fixed-Income Securities features a compilation of the most up-to-date fixed-income securities techniques and methods. The book presents crucial topics of fixed income in an accessible and logical format. Emphasizing empirical research and real-life applications, the book explores a wide range of topics from the risk and return of fixed-income investments, to the impact of monetary policy on interest rates, to the post-crisis new regulatory landscape. Well organized to cover critical topics in fixed income, Handbook of Fixed-Income Securities is divided into eight main sections that feature: • An introduction to fixed-income markets such as Treasury bonds, inflation-protected securities, money markets, mortgage-backed securities, and the basic analytics that characterize them • Monetary policy and fixed-income markets, which highlight the recent empirical evidence on the central banks’ influence on interest rates, including the recent quantitative easing experiments • Interest rate risk measurement and management with a special focus on the most recent techniques and methodologies for asset-liability management under regulatory constraints • The predictability of bond returns with a critical discussion of the empirical evidence on time-varying bond risk premia, both in the United States and abroad, and their sources, such as liquidity and volatility • Advanced topics, with a focus on the most recent research on term structure models and econometrics, the dynamics of bond illiquidity, and the puzzling dynamics of stocks and bonds • Derivatives markets, including a detailed discussion of the new regulatory landscape after the financial crisis and an introduction to no-arbitrage derivatives pricing • Further topics on derivatives pricing that cover modern valuation techniques, such as Monte Carlo simulations, volatility surfaces, and no-arbitrage pricing with regulatory constraints • Corporate and sovereign bonds with a detailed discussion of the tools required to analyze default risk, the relevant empirical evidence, and a special focus on the recent sovereign crises A complete reference for practitioners in the fields of finance, business, applied statistics, econometrics, and engineering, Handbook of Fixed-Income Securities is also a useful supplementary textbook for graduate and MBA-level courses on fixed-income securities, risk management, volatility, bonds, derivatives, and financial markets. Pietro Veronesi, PhD, is Roman Family Professor of Finance at the University of Chicago Booth School of Business, where he teaches Masters and PhD-level courses in fixed income, risk management, and asset pricing. Published in leading academic journals and honored by numerous awards, his research focuses on stock and bond valuation, return predictability, bubbles and crashes, and the relation between asset prices and government policies.

Bank Lending in the Knowledge Economy

Author : Mr.Giovanni Dell'Ariccia
Publisher : International Monetary Fund
ISBN 13 : 1484324897
Total Pages : 45 pages
Book Rating : 4.4/5 (843 download)

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Book Synopsis Bank Lending in the Knowledge Economy by : Mr.Giovanni Dell'Ariccia

Download or read book Bank Lending in the Knowledge Economy written by Mr.Giovanni Dell'Ariccia and published by International Monetary Fund. This book was released on 2017-11-07 with total page 45 pages. Available in PDF, EPUB and Kindle. Book excerpt: We study bank portfolio allocations during the transition of the real sector to a knowledge economy in which firms use less tangible capital and invest more in intangible assets. We show that, as firms shift toward intangible assets that have lower collateral values, banks reallocate their portfolios away from commercial loans toward other assets, primarily residential real estate loans and liquid assets. This effect is more pronounced for large and less well capitalized banks and is robust to controlling for real estate loan demand. Our results suggest that increased firm investment in intangible assets can explain up to 20% of bank portfolio reallocation from commercial to residential lending over the last four decades.

Innovation and Market Value. The Case of Tourism Enterprises

Author : Dawid Szutowski
Publisher : Helion
ISBN 13 : 8380852478
Total Pages : 267 pages
Book Rating : 4.3/5 (88 download)

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Book Synopsis Innovation and Market Value. The Case of Tourism Enterprises by : Dawid Szutowski

Download or read book Innovation and Market Value. The Case of Tourism Enterprises written by Dawid Szutowski and published by Helion. This book was released on 2017-03-18 with total page 267 pages. Available in PDF, EPUB and Kindle. Book excerpt: In contemporary economics only one thing is constant – constant change [Gunday et al., 2011]. The notion of change relates directly to innovation. The very nature of innovation constitutes combining existing factors in a new, changed way. Since the early stage of the scientific investigation of innovation research has focused mainly on the solutions actually implemented [Schumpeter 1939]. Yet it is only through implementation that the benefits of innovation may materialise. The task is not simple. The process of obtaining the gains is complex as innovation may pass through different stages. Thus for almost half-century the scientific community has considered innovation to be a complex process and not just a simple occurrence [Myers and Marquis 1969]. Innovation pushes progress forward. Thus previous scientific investigation limited the concept of innovation to implementations which generate positive effects [Nelson and Winter 1982]. The above scientific considerations still hold today [Moss Kanter 2006]. Innovation is of crucial importance for tourism companies, which cover accommodation for visitors, food and beverage serving activities, passenger transportation, travel agencies and other reservation activities, cultural activities, sports and recreational activities and retail trade of country-specific tourism characteristic goods [UNWTO 2010]. It provides them with competitive advantage and hence the firms with market power gain more from innovation [Tirole 1995]. A firm’s innovation interacts with the environment. It delivers diverse benefits to the consumers in the form of new products and lower prices which in turn impact positively on the company [Shiller 2006]. In the context of tourism the ongoing scientific discussion on innovation seems not to have achieved any definite conclusions yet. The implementation of innovation in tourism enterprises leads to the achievement of diverse ends. From this point of view the measurement of the effects of innovation is of vital importance. There are a number of financial measures covering substantially different fields. The most comprehensive amongst them is a company’s value. It covers all the aspects of a company’s activity [Bodie and Merton 2000]. However due to its importance and complexity numerous approaches to company value were created. The basic distinction covers book and market value based approaches. The proponents of book value assume that the balance sheet yields a reliable estimate of the value of assets and equities. However numerous shortcomings emerge: the static character, dealing with historical figures, failing to include intangibles and treating all classes of accounts as having equal importance [Nunes 2003]. The market value based approach stands for the price that assets would fetch in the marketplace [Fabrozi and Drake 2009]. The main objective of the research is to measure the short- and long-term impact of innovation announcements on the market value of equity of tourism enterprises.

The Risk of Economic Crisis

Author : Martin Feldstein
Publisher : University of Chicago Press
ISBN 13 : 9780226240916
Total Pages : 212 pages
Book Rating : 4.2/5 (49 download)

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Book Synopsis The Risk of Economic Crisis by : Martin Feldstein

Download or read book The Risk of Economic Crisis written by Martin Feldstein and published by University of Chicago Press. This book was released on 1991-08-13 with total page 212 pages. Available in PDF, EPUB and Kindle. Book excerpt: Based on a special National Bureau of Economic Research conference held in Oct. 1989. Includes bibliographical references and indexes.

Panel Data Econometrics

Author : Manuel Arellano
Publisher : Oxford University Press
ISBN 13 : 0199245282
Total Pages : 244 pages
Book Rating : 4.1/5 (992 download)

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Book Synopsis Panel Data Econometrics by : Manuel Arellano

Download or read book Panel Data Econometrics written by Manuel Arellano and published by Oxford University Press. This book was released on 2003 with total page 244 pages. Available in PDF, EPUB and Kindle. Book excerpt: Written by one of the world's leading experts on dynamic panel data reviews, this volume reviews most of the important topics in the subject. It deals with static models, dynamic models, discrete choice and related models.

Proceedings of the 8th International Conference on Accounting, Management, and Economics (ICAME 2023)

Author : Arianto Patunru
Publisher : Springer Nature
ISBN 13 : 9464634006
Total Pages : 1094 pages
Book Rating : 4.4/5 (646 download)

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Book Synopsis Proceedings of the 8th International Conference on Accounting, Management, and Economics (ICAME 2023) by : Arianto Patunru

Download or read book Proceedings of the 8th International Conference on Accounting, Management, and Economics (ICAME 2023) written by Arianto Patunru and published by Springer Nature. This book was released on 2024 with total page 1094 pages. Available in PDF, EPUB and Kindle. Book excerpt: Zusammenfassung: This is an open access book. The International Conference on Accounting, Management, and Economics (ICAME) is an annual agenda organized by the Faculty of Economics and Business, Hasanuddin University. In 2023, we would like to introduce to you the 8th ICAME with the current theme entitled "Establishing Inclusive Economy and Business". SUB THEME Development Economics Public Economics Financial Accounting Management Accounting Finance and Investment Sustainability Business Corporate Governance Human Capital Islamic Economics Other Related; Accounting, Management, Economics Issues We hope that our conference can add discussions and information from various research towards the discourse of new economic policy in the post-pandemic era. This activity also became an important agenda in publishing scientific papers by academics and became a positive contribution to mapping Indonesia's future development. Therefore, we would like to invite academics, practitioners, researchers to contribute to the development of economic and business management research through participating in the 8th of ICAME. Thank you for your participation and we look forward to meeting you at the conference

Bank Capital and the Cost of Equity

Author : Mohamed Belkhir
Publisher : International Monetary Fund
ISBN 13 : 1513522574
Total Pages : 44 pages
Book Rating : 4.5/5 (135 download)

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Book Synopsis Bank Capital and the Cost of Equity by : Mohamed Belkhir

Download or read book Bank Capital and the Cost of Equity written by Mohamed Belkhir and published by International Monetary Fund. This book was released on 2019-12-04 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt: Using a sample of publicly listed banks from 62 countries over the 1991-2017 period, we investigate the impact of capital on banks’ cost of equity. Consistent with the theoretical prediction that more equity in the capital mix leads to a fall in firms’ costs of equity, we find that better capitalized banks enjoy lower equity costs. Our baseline estimations indicate that a 1 percentage point increase in a bank’s equity-to-assets ratio lowers its cost of equity by about 18 basis points. Our results also suggest that the form of capital that investors value the most is sheer equity capital; other forms of capital, such as Tier 2 regulatory capital, are less (or not at all) valued by investors. Additionally, our main finding that capital has a negative effect on banks’ cost of equity holds in both developed and developing countries. The results of this paper provide the missing evidence in the debate on the effects of higher capital requirements on banks’ funding costs.

Valuation Approaches and Metrics

Author : Aswath Damodaran
Publisher : Now Publishers Inc
ISBN 13 : 1601980140
Total Pages : 102 pages
Book Rating : 4.6/5 (19 download)

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Book Synopsis Valuation Approaches and Metrics by : Aswath Damodaran

Download or read book Valuation Approaches and Metrics written by Aswath Damodaran and published by Now Publishers Inc. This book was released on 2005 with total page 102 pages. Available in PDF, EPUB and Kindle. Book excerpt: Valuation lies at the heart of much of what we do in finance, whether it is the study of market efficiency and questions about corporate governance or the comparison of different investment decision rules in capital budgeting. In this paper, we consider the theory and evidence on valuation approaches. We begin by surveying the literature on discounted cash flow valuation models, ranging from the first mentions of the dividend discount model to value stocks to the use of excess return models in more recent years. In the second part of the paper, we examine relative valuation models and, in particular, the use of multiples and comparables in valuation and evaluate whether relative valuation models yield more or less precise estimates of value than discounted cash flow models. In the final part of the paper, we set the stage for further research in valuation by noting the estimation challenges we face as companies globalize and become exposed to risk in multiple countries.

Economic Analyses Using The Overlapping Generations Model And General Equilibrium Growth Accounting For The Japanese Economy: Population, Agriculture And Economic Development

Download Economic Analyses Using The Overlapping Generations Model And General Equilibrium Growth Accounting For The Japanese Economy: Population, Agriculture And Economic Development PDF Online Free

Author : Mitoshi Yamaguchi
Publisher : World Scientific
ISBN 13 : 9814571504
Total Pages : 355 pages
Book Rating : 4.8/5 (145 download)

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Book Synopsis Economic Analyses Using The Overlapping Generations Model And General Equilibrium Growth Accounting For The Japanese Economy: Population, Agriculture And Economic Development by : Mitoshi Yamaguchi

Download or read book Economic Analyses Using The Overlapping Generations Model And General Equilibrium Growth Accounting For The Japanese Economy: Population, Agriculture And Economic Development written by Mitoshi Yamaguchi and published by World Scientific. This book was released on 2014-05-29 with total page 355 pages. Available in PDF, EPUB and Kindle. Book excerpt: This unique book contains novel and in-depth research regarding economic development in Japan. The authors examine economic development in Japan from both theoretical and empirical perspectives. Using general equilibrium growth accounting and the overlapping generations model, they analyze the relationships between population, agriculture and the economy. The research results are unprecedented and show the effects of increased adult longevity on national savings and the effects of demographic change on the industrial structure; the push-pull effects of technical change in agricultural and non-agricultural sectors and the positive effects of population on technical change and economic development.

New Perspectives and Paradigms in Applied Economics and Business

Author : William C. Gartner
Publisher : Springer Nature
ISBN 13 : 3031238443
Total Pages : 459 pages
Book Rating : 4.0/5 (312 download)

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Book Synopsis New Perspectives and Paradigms in Applied Economics and Business by : William C. Gartner

Download or read book New Perspectives and Paradigms in Applied Economics and Business written by William C. Gartner and published by Springer Nature. This book was released on 2023-03-20 with total page 459 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book features a collection of high-quality and peer-reviewed papers from the 2022 6th International Conference on Applied Economics and Business (ICAEB), which was held in Stockholm, Sweden, during August 24-26, 2022. ICAEB serves as a platform for presentation of new advances and research results in the fields of applied economics and business. Applied economics is used to improve the quality of practice in business and public policy by thinking meticulously about new ways to approach old problems. Presentations at the conference include the topical areas of development, ecological, financial, forensic, information, institutional, international, labor, managerial, mathematical, monetary, and other related economic aspects. All these topics relate to an overall theme of sustainable development from an economic perspective. The conference brings together scientists from different fields of applied economic research in order to exchange ideas and experiences leading to improved methods of economic analysis.