Showing papers on "Market capitalization published in 2020"
TL;DR: The findings suggest that for a moderate deterioration in economic conditions, a tax deferral is sufficient, however, in the event of exacerbating business shocks, there should be hybrid support through debt and equity to avoid a meltdown.
125 citations
TL;DR: In this paper, the authors examined the effect of stock market development on the low-carbon economy (LCE) in European Union member countries by using the cross-sectional autoregressive distributed lags (CS-ARDL) approach.
90 citations
TL;DR: In this article, a method relying on the AIC is proposed to quickly react to market changes and therefore enable to create an index, referred to as CRIX, for the cryptocurrency market.
Abstract: The cryptocurrency market is unique on many levels: Very volatile, frequently changing market structure, emerging and vanishing of cryptocurrencies on a daily level. Following its development became a difficult task with the success of cryptocurrencies (CCs) other than Bitcoin. For fiat currency markets, the IMF offers the index SDR and, prior to the EUR, the ECU existed, which was an index representing the development of European currencies. Index providers decide on a fixed number of index constituents which will represent the market segment. It is a challenge to fix a number and develop rules for the constituents in view of the market changes. In the frequently changing CC market, this challenge is even more severe. A method relying on the AIC is proposed to quickly react to market changes and therefore enable us to create an index, referred to as CRIX, for the cryptocurrency market. CRIX is chosen by model selection such that it represents the market well to enable each interested party studying economic questions in this market and to invest into the market. The diversified nature of the CC market makes the inclusion of altcoins in the index product critical to improve tracking performance. We have shown that assigning optimal weights to altcoins helps to reduce the tracking errors of a CC portfolio, despite the fact that their market cap is much smaller relative to Bitcoin. The codes used here are available via this http URL.
68 citations
TL;DR: The spillover effects among 14 cryptocurrencies by employing transfer entropy are investigated and it is suggested that among different types of cryptos, Bitcoin is still the most appropriate instrument for hedging, while Tether which have a strong anchor with the US dollar is significantly volatile.
67 citations
11 Feb 2020
TL;DR: The world's most valuable public companies and its first trillion-dollar businesses are built on digital platforms that bring together two or more market actors and grow through network effects as mentioned in this paper, and all of them are platform businesses.
Abstract: The world’s most valuable public companies and its first trillion-dollar businesses are built on digital platforms that bring together two or more market actors and grow through network effects. The top-ranked companies by market capitalization are Microsoft, Apple, Amazon, and Alphabet (Google’s parent company). Facebook, Alibaba, and Tencent are not far behind. As of November 2019, these seven companies represented more than $5.4 trillion in market value, and all of them are platform businesses.
61 citations
TL;DR: A cross-reference to exchange-based stock trend (CREST) prediction method is proposed using long short-term memory (LSTM) to predict stock markets in terms of future indices, price movement, and returns perspectives.
39 citations
TL;DR: Analysis of trends in market capitalization and total direct written premiums from 2001 to 2016 of the top 5, 10, and 25 health insurance companies indicates that the market concentration of publicly traded companies has remained relatively stable over the past decade.
Abstract: With the establishment of state-based health insurance marketplaces, how U.S. health insurers are responding to market pressures and influencing premiums have represented important questions. We made novel use of the Standard and Poor’s (S&P) Financial, a Wall Street financial dataset platform, to analyze trends in market capitalization and total direct written premiums (DWPs) from 2001 to 2016 of the top 5, 10, and 25 health insurance companies. Our results indicate that the market concentration of publicly traded companies has remained relatively stable over the past decade. The top 5, 10, and 25 health insurance companies were 43.5%, 57.5%, and 78.6% of the total market share in 2001 and 39.4%, 52.9%, and 72.8% in 2016, respectively. DWPs have grown nearly four-fold from $177 billion to $631 billion at a compounded annual rate of 8.8%, consistent with overall healthcare sector growth. Aggregating state-specific data, the overall U.S. health insurance market has become slightly less consolidated over recent years, as measured using the population-weighted Herfindahl-Hirschman index, a measure for market concentration, falling from 3,817 to 2,174 during this time period. As health insurance costs place a growing burden on American families, additional efforts are needed to study the impact on choice, quality, access, cost, and value to patients and providers from evolving health insurance markets.
39 citations
TL;DR: In this article, the impact of natural resource abundance on financial development proxies financialization with either domestic credit to the private sector or market capitalization of domestic companies is investigated. And the authors reveal reliable and robust empirical results by employing both traditional and second generation econometric techniques for the dataset.
37 citations
TL;DR: A new framework is provided to understand the relationships between e-commerce capabilities, organizational agility and agricultural firms’ performance gains and indicated that organizational agility plays a mediating role in conveying the positive influences of e- commerce capabilities on agricultural firms' performance gains.
Abstract: This study aimed to investigate the impact of e-commerce capabilities on agricultural firms’ performance gains through organizational agility.,A survey was used to collect data from 280 managers of agricultural firms. The proposed model was tested via structural equation modeling.,The empirical results indicated that organizational agility plays a mediating role in conveying the positive influences of e-commerce capabilities on agricultural firms’ performance gains. Specifically, managerial, talent and technical capabilities have different effects on market capitalization and operational adjustment agility, with talent capability performing the most important role. Market capitalization and operational adjustment agility have positive impacts on financial and nonfinancial performance gains, respectively.,This study provides a new framework to understand the relationships between e-commerce capabilities, organizational agility and agricultural firms’ performance gains.
36 citations
TL;DR: In this paper, the authors examine whether and how board connections affect the firm's corporate social responsibilities (CSR) and find that board connectedness is positively associated with CSR performance.
31 citations
TL;DR: In this article, the authors use social network data from Facebook to show that institutional investors are more likely to invest in firms from regions to which they have stronger social ties, and that the response of investment decisions to social connectedness affects equilibrium capital market outcomes.
Abstract: We use social network data from Facebook to show that institutional investors are more likely to invest in firms from regions to which they have stronger social ties. This effect of social proximity on investment behavior is distinct from the effect of geographic proximity. Social connections have the largest influence on investments of small investors with concentrated holdings as well as on investments in firms with a low market capitalization and little analyst coverage. We also find that the response of investment decisions to social connectedness affects equilibrium capital market outcomes: firms in locations with stronger social ties to places with substantial institutional capital have higher institutional ownership, higher valuations, and higher liquidity. These effects of social proximity to capital on capital market outcomes are largest for small firms with little analyst coverage. We find no evidence that investors generate differential returns from investments in locations to which they are socially connected. Our results suggest that the social structure of regions affects firms' access to capital and contributes to geographic differences in economic outcomes.
Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
TL;DR: In this article, the authors investigated the behavior of foreign investors in the Stock Exchange of Thailand (SET) in the time of coronavirus disease 2019 (COVID-19) as to whether trading is abnormal, what strategy is followed, whether herd behavior is present, and whether the actions destabilize the market.
Abstract: This study investigates the behavior of foreign investors in the Stock Exchange of Thailand (SET) in the time of coronavirus disease 2019 (COVID-19) as to whether trading is abnormal, what strategy is followed, whether herd behavior is present, and whether the actions destabilize the market Foreign investors' trading behavior is measured by net buying volume divided by market capitalization, whereas the stock market behavior is measured by logged return on the SET index portfolio The data are daily from Tuesday, August 28, 2018, to Monday, May 18, 2020 The study extends the conditional-regression model in an event-study framework and extracts the unobserved abnormal trading behavior using the Kalman filtering technique It then applies vector autoregressions and impulse responses to test for the investors' chosen strategy, herd behavior, and market destabilization The results show that foreign investors' abnormal trading volume is negative and significant An analysis of the abnormal trading volume with stock returns reveals that foreign investors are not positive-feedback investors, but rather, they self-herd Although foreign investors' abnormal trading does not destabilize the market, it induces stock-return volatility of a similar size to normal trade The methodology is new;the findings are useful for researchers, local authorities, and investors © The Author(s)
TL;DR: In this article, the impact of different measures of firm size (total assets, total sales, market capitalization and number of employees) on seven important practices of corporate finance was examined, including financial policy, dividend policy, investment policy, diversification, firm performance, compensation and incentives and board structure.
TL;DR: In this article, the authors examined the effect of herding in two different cross-sections of financial markets using cross-sectional deviations of stock returns to measure the dispersion of individual stock returns from average market return.
Abstract: Literature on financial economics suggests that market participants tend to suppress their own information and try to imitate others in the market, thereby herding against their private information This tendency is attributed to risk aversion characteristic of economic agents that rely more on short cuts and heuristics in order to avoid risk of losing time required to incorporate private information Such a tendency also results in the asymmetric expected returns on assets We attempt to find empirical evidence of herding in two different cross-sections of financial markets using cross-sectional deviations of stock returns to measure the dispersion of individual stock returns from average market return Using a unique dataset of daily stock returns from January 2011 to December 2015, we examine the small and large-cap stocks for the effect of herding We study the existence of herding in two cross-sections of stocks in the Indian stock market and show that stocks with robust fundamentals observe little or negligible evidence of herding while vulnerable stocks are evidently found to be affected by herding While examining herding, we show whether the cross-sectional dispersion of stock returns in large-cap stocks are lower compared to that in small-cap stocks, implying stocks with higher market capitalization and trading volume are less prone to herding
TL;DR: In this article, the authors find that the top-10% of financial stocks on average account for over 20% of a country's market capitalization but earn on average significantly lower returns than do non-financial firms of the same size and risk exposures.
Abstract: Across a wide panel of countries, the top-10% of financial stocks on average account for over 20% of a country’s market capitalization but earn on average significantly lower returns than do nonfinancial firms of the same size and risk exposures. In a bailout-augmented, rare disasters asset pricing model, the spread in risk-adjusted returns between large and small institutions depends on country characteristics that determine the likelihood of bailouts. Consistent with this model, we find larger spreads in countries with large and interconnected financial sectors, weaker capital regulation and corporate governance, and fiscally stronger governments. Valuation gaps increase in anticipation of financial crises.Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.
TL;DR: In this article, the effect of corporate governance on intellectual capital has been examined and the results show that corporate governance is beneficial for the creation of value and competitive advantage for companies, but not necessarily beneficial for individuals.
Abstract: Intellectual capital (IC) has been widely recognized as an important resource in creating value and competitive advantage for companies. This study therefore examined the effect of corporate govern...
TL;DR: Wang et al. as discussed by the authors examined the impact of corporate social responsibility (CSR) activity on the firm market value, in particular, market capitalization of tour operators listed on Chinese stock markets.
Abstract: The study examines the impact of corporate social responsibility (CSR) activity on the firm market value, in particular, market capitalization of tour operators listed on Chinese stock markets. This study employs panel data analysis methods to examine endogeneity concerns in observational data. The balanced panel data includes a total of 1,296 observations with 27 cross-sections of tour operators listed on Chinese stock markets and with 48 time-specific periods from March 2006 to December 2017. The results indicate that CSR activity has a negative impact on the market value of the firm for the concurrent period, but from one-period time lag and afterwards CSR activity has a strong positive impact on the market value and sustains its positive impact on the market value even for a two-period time lag. The findings suggest that the economic effect of CSR activity on the firm market value tends to take some degree of lagged effects to be fully showcased in the market capitalization of tour operators and travel companies listed on Chinese stock markets. The findings suggest that, though CSR activity may carry some financial risk for an immediate short-term, tour operators must put a lot of time and effort into making CSR actions effective.
TL;DR: In this article, the authors employ three additional measures of financial development, namely equity market, money supply and market capitalization, and further investigate cross-country evidence on the impact of equity market and money supply spillovers on economic growth in BRICS economies.
TL;DR: This article showed that federal procurement contracts insulated government contractors' performance from the 2008-2009 financial crisis, and this stabilizing effect in turn spilled over into neighboring firms, and an average amount of government purchases reduced local employment losses by 35% in retail industries.
Abstract: I document a beneficial effect of the government’s participation in product markets. Exploiting the 2008–2009 financial crisis as a natural experiment, I show that federal procurement contracts insulated government contractors’ performance from the crisis. By 2009, government contractors had 15% higher market capitalization, had 18% higher capital expenditures, and received 26% more bank credit than did similar firms. This stabilizing effect, in turn, spilled over into neighboring firms. An average amount of government purchases reduced local employment losses by 35% in retail industries and by 48% in industries supplying government contractors. Spillovers were particularly strong in high economic slack areas.Author has furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.
TL;DR: In this article, the relationship between competition and diversification based on a sample of 1,570 commercial banks located in 28 European Union member states over the period of 2000 through 2016 was analyzed.
TL;DR: In this paper, the authors examined how Covid 19 outbreak has affected leading pharmaceutical stocks listed with the National Stock Exchange of India (NSE) and found that momentum effect is persisting with pharmaceutical stocks as the pharmaceutical stocks are moving in accordance with the general benchmarking index.
Abstract: The purpose of this study is to examine how Covid 19 outbreak has affected leading pharmaceutical stocks listed with the National Stock Exchange of India. We have selected ten leading pharmaceutical companies listed with NSE, and the selection was purely based on the market capitalization of the companies. The general hypothecation of this study was the pharmaceutical stocks will move against the general market trend (contrarian effect). The study period was classified in to pre-crisis period and Covid 19 crisis period. The data consists of 123 daily price observations of the selected 10 pharmaceutical companies. The period of study is ranging from 3rd September 2019 to 28th February 2020. The results reported that momentum effect is persisting with pharmaceutical stocks as the pharmaceutical stocks are moving in accordance with the general benchmarking index. Only two companies, namely Aurobindo Pharma Ltd and Lupin Ltd reported with varied return trend during the study period. This study also signifies that companies like Sun Pharma, Cipla, Glenmark with strong brand reputation were seems to be sustaining in the crisis period in spite of the general falling market trend. This paper is strongly urge the need for backward integration and enhanced research and development activities to Indian Pharmaceutical sector for ensuring their sustainable long-run operations.
TL;DR: In this article, the authors investigate the level of intellectual capital disclosure in commercial banks listed on the Indonesian Stock Exchange and observe the effects of ICD and corporate governance mechanism on market value.
Abstract: The aim of this paper is to investigate the level of intellectual capital disclosure (ICD) in commercial banks listed on the Indonesian Stock
Exchange. This paper also observed the effects of ICD and corporate governance mechanism on market value. This study uses content
analysis techniques to measure ICD. The paper provides a novel approach to measure the ICD quality in developing countries using a fournumerical coding system. Secondary data were obtained from the financial statements and annual reports of the banks for the period 2011-
2014. The data from 31 banks were analyzed using ordinary least square regression. The study reports that the quality of intellectual capital
disclosure in Indonesian commercial banks increase steadily. Narrative disclosure dominates the report of intellectual capital in Indonesian
banks. The results indicate that the size of audit committee, frequency of audit committee meeting, and intellectual capital disclosure affect
positively the market value. Overall, the results indicate intellectual capital disclosure is associated with the market capitalization; these
findings indicate that the ICD is a consideration in a stock investment decision. While regulations in Indonesia regarding intellectual capital
reporting are not conclusive yet, the information needs of stakeholders have encouraged companies to expand voluntary disclosure.
Journal Article•
TL;DR: In this article, the economic and organizational effect of mergers and acquisitions in the international business environment has been investigated and the format of the impact of cost of equity of business structures on the effect of synergy and market capitalization has been determined.
Abstract: The scientific article considers methodological approaches to obtaining the economic and organizational effect of mergers and acquisitions in the international business environment. The format of the impact of cost of equity of business structures on the effect of synergy and market capitalization has been determined. The econometric model for assessing the impact of financial leverage on the economic efficiency of a merger or acquisition has been developed. Various options for choosing the structure of financing mergers and acquisitions for entrepreneurial structures have been investigated.
TL;DR: In this paper, a comprehensive study of factors affecting the level of capitalization of oil and gas companies in Russia and identification of the most significant among them with a special focus on the green factor is presented.
Abstract: Research background: This paper studies the impact of a new so-called green factor on the capitalization of petroleum companies, which is becoming highly relevant in view of the signing of the Paris agreements in 2015 and the support for clean energy. Although society, international organizations, and government authorities encourage companies to reduce their environmental impact, one of the main reasons for responsible behavior is still economic efficiency. The oil industry, on the one hand, faces one of the most volatile markets and, on the other hand, has one of the largest environmental impacts of any industry. That requires a detailed study of interconnections between market capitalization and the green factor.
Purpose of the article: A comprehensive study of factors affecting the level of capitalization of oil and gas companies in Russia and identification of the most significant among them with a special focus on the green factor.
Methods: Econometric analysis of panel data for Russian petroleum companies. The database includes indicators for six major Russian oil companies from 2011 to 2018. The following groups of factors are analyzed to explain the change in the companies? capitalization: macroeconomic (GDP and inflation in Russia), microeconomic (companies? revenue, net profit, tax payment, return on assets, return on equity, ratio of borrowed capital to equity), industrial (oil export, refining, production and proven reserves of the companies), and the green factor.
Findings & Value added: The selection of factors showed that the size of capitalization has been influenced most significantly by the following: the volume of the company's proven reserves, net profit, tax burden, and the green factor based on the policy of minimizing environmental damage. This result shows that investors consider companies with high environmental performance to be more valuable than companies with similar financial results but lower environmental ratings.
25 Apr 2020
TL;DR: This paper examined the velocity of Coronavirus pandemic effect on major stock markets during the early stages of the pandemic and examined whether or not there was any difference before and after the first confirmed CORONAVirus case reported, finding that there was an inverse relation between the distance of the stock market from Wuhan and the financial performance of that market.
Abstract: Capital is coward, money tend to flee the markets during crises periods. In just few days after declaring Coronavirus as a pandemic by the World Health Organization (WHO), major stock markets lost more than 15% of their market capitalization. This study aims to examine the velocity of Coronavirus pandemic effect on major stock markets during the early stages of the pandemic. The study also examines whether or not there was any difference before and after the first confirmed Coronavirus case reported. Using the data on eleven major stock markets, results from this study shows that, out of the eleven markets under study, six markets showed no difference in mean return 30 trading days before and after reporting the first Coronavirus case in these countries. The results also showed that WHO announcement had a more impact on the stock markets performance than the announcements of local health authorities’ announcements. One interesting finding in this research is that there was an inverse relation between the distance of the stock market from Wuhan and the financial performance of that market.
TL;DR: In this paper, the authors investigate the effects of early adoption of International Standards on Auditing (ISAs) on financial market indicators from a diffusion of innovation (DOI) theory perspective.
Abstract: This paper aims to investigate the effects of the early adoption of International Standards on Auditing (ISAs) on Financial Market Indicators (FMIs) from a diffusion of innovation (DOI) theory perspective.,Using panel data from 110 countries in a period that spans from 1995 to 2014, this study applies an ordinary least squares regression model to investigate the financial consequences of adopting ISAs. This analysis was supplemented with estimating a fixed-effects and two-stage least squares regression models to address any concerns regarding the possible existence of endogeneity problems.,This study reports three key findings. First, the authors find that early ISAs adoption has a negative effect on several financial market consequences, namely stock market integration, market capitalisation, market turnover, market return, market development, stock price volatility and stock trading volume. Second, using an alternative measure to the one that is proposed by DOI theory, the authors found that some financial indicators have been significantly improved after ISAs adoption, but only for listed firms that prepared their financial statements under International Financial Reporting Standards and audited by ISAs simultaneously. Finally, the financialindicators of European stock markets, however, have insignificantly shrank post the mandatory adoption of ISAs in 2006.,The empirical evidence raises questions about how ISAs were enforced and implemented. For example, countries that adopted ISAs at early stages may have been dominated mostly by recently established stock exchanges. This implies a crucial need to determine and apply the best type of auditing regime that can increase investors trust and enhance the credibility of stock markets information, which might ultimately advance the FMIs over time significantly.,To-date, studies investigating the impact of the adoption of ISAs on FMI from a DOI theory perspective are virtually non-existent. The study, therefore, seeks to contribute to the extant literature by examining the influence of ISAs adoption on a wide range of FMIs.
TL;DR: In this article, an empirical evaluation of self-attribution, overconfidence bias and dynamic market volatility at Bombay Stock Exchange (BSE) across various market capitalizations is presented.
Abstract: The article provides an empirical evaluation of self-attribution, overconfidence bias and dynamic market volatility at Bombay Stock Exchange (BSE) across various market capitalizations. First, the ...
TL;DR: In this paper, the authors investigated which index characteristics predict returns in the cross-section of local industry indexes in six regions and found that geographical origin and market capitalization of indexes critically determine the predictive ability of characteristics.
06 Nov 2020
TL;DR: In this article, the authors used event study methodology to evaluate the Indonesia's sectoral stock market performance which is represented by companies with the biggest market capitalization in Indonesia and found that the abnormal returns were found in the Basic Industry and Chemicals sector, Infrastructure, Utilities and Transportation sector, Agricultural sector and Mining sector.
Abstract: COVID-19 has become a global issue that bought a simultaneous effect all over the world. This outbreak has caused a significant impact on the economic stability including the stock market performance. This research used event study methodology to evaluate the Indonesia’s sectoral stock market performance which is represented by companies with the biggest market capitalization in Indonesia. Estimating the COVID-19 outbreak events, the sample of the study consisted of daily sectoral indices stock data from 1 December 2017 to 14 April 2020. The market model is used to predict expected stock returns and simple regression to get the parameters of the equation. By using a t-test, it can be concluded whether the virus outbreak caused an abnormal return on the sectoral indices. The finding showed that the abnormal returns were found in the Basic Industry and Chemicals sector, Infrastructure, Utilities and Transportation sector, Agricultural sector and Mining sector. Furthermore, Basic Industry and Chemical sector, which is represented by Barito Pasific Ltd., give the greatest reaction to the stock market performance in Indonesia due to COVID-19.
Keywords: abnormal return, event study, stock return, COVID-19, Indonesia
01 Dec 2020
TL;DR: In this paper, a comparative analysis of the effects of money and capital markets on the Ghanaian economy covering the period from 1991 to 2017 using the dynamic Auto Regressive Distributed Lag (ARDL) framework is presented.
Abstract: This study is a comparative analysis of the effects of money and capital markets on the Ghanaian economy covering the period from 1991 to 2017 using the dynamic Auto Regressive Distributed Lag (ARDL) framework. Empirical results confirmed the existence of a unique and stable long-run relationship between the money market, capital market and economic growth. In respect of money market indicators, findings confirmed that monetary policy and treasury bills rate have had negative but significant impact on growth in the short- and long-run respectively. More so, total liquidity negatively and significantly influenced the Ghanaian economy both in the short- and in the long run. Both market capitalization and total value of stock traded, as proxies of capital market, had positive and significant effects on short-run growth, while both indicators as well as stock market turnover negatively and insignificantly affected long-run growth. This means that capital market exerts a short-run impact on the country's economy, while money market exerts both short- and long-run impacts. The lesson relearned is that the money market propels the Ghanaian economy better than the capital market.