Topic
Financial risk
About: Financial risk is a research topic. Over the lifetime, 11899 publications have been published within this topic receiving 231404 citations. The topic is also known as: economic risk.
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TL;DR: The financial sector preconditions for the successful development of a high technology sector are examined and it is argued that there is a close relation between types of activities undertaken in different countries and their institutional structures.
56 citations
TL;DR: In this paper, the authors investigate whether fund managers have ranking objectives (as in a tournament) and derive conditions on the set of possible strategies under which the aggregate amount of risk undertaken in the late period is larger than in the first period.
Abstract: There is now extensive empirical evidence showing that fund managers have relative performance objectives and adapt their investment strategy in the last part of the calendar year to their performance in the early part of the year. However, emphasis was put on returns in excess of some exogenous benchmark return.In this paper, we investigate whether fund managers have ranking objectives (as in a tournament).First, in a two-period model, we analyze the game played by two risk-neutral fund managers with ranking objectives.We derive conditions on the set of possible strategies under which the aggregate amount of risk undertaken in the late period is larger than in the first period.In the second part of the paper, we provide evidence that (i) funds have risk incentives generated by ranking objectives, (ii) risk induced by ranking objectives is mainly idiosyncratic, and (iii) risk incentives generated by ranking objectives are stronger for funds ranked in the top decile after the first part of the year.
56 citations
TL;DR: The authors empirically explored the economic-, tourism-, and country risk ratings-induced Environmental Kuznets Curve (EKC) hypothesis by employing ecological footprints (EFs) as indicators of international environmental degradation.
56 citations
TL;DR: In this paper, the authors provided a novel analysis of four risk ratings using multivariate conditional volatility models for six countries, namely Albania, Bulgaria, Greece, Romania, Serbia and Montenegro, and Turkey, situated in the Balkan Peninsula.
56 citations
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TL;DR: In this paper, the authors investigated the benefits of allowing households to compensate the portfolio distortion due to their housing consumption through investments in housing price derivatives and showed that a major loss from over-investment in housing is that households are forced to hold a very risky portfolio.
Abstract: This paper investigates the benefits of allowing households to compensate the portfolio distortion due to their housing consumption through investments in housing price derivatives. Focusing on the London market, we show that a major loss from over-investment in housing is that households are forced to hold a very risky portfolio. However, the strong performance of the London housing market means that little is lost in terms of expected returns. Even households with limited wealth are better off owning their home rather than renting and investing in financial assets, as long as they are willing to face the financial risk involved. In this context, access to housing price derivatives would benefit most poor homeowners looking to limit their risk exposure. It would also benefit wealthier investors looking for the high returns provided by housing investments without the costs of direct ownership of properties. Comparisons with French, Swedish and US data provide a broader perspective on our findings.
56 citations