Showing papers on "Stock (geology) published in 1978"

Speculative Investor Behavior in a Stock Market with Heterogeneous Expectations

Abstract: Consider a common stock that pays dividends at a discrete sequence of future times: t = 1,2, Taking all other prices and the random process that determines future dividends as exogenously given, we can ask what will be the price ofthe stock? In a world with a complete set of contingency claims markets, in which every investor can buy and sell without restriction, the answer is given by arbitrage. Let dtixt) denote the dividend that will be paid at time t if contingency Xj prevails, and let Ptixt) denote the current {t = 0) price ofa one dollar claim payable at time t if contingency Xt prevails. Then the current stock price must be 2(2;t,i3t(x«)dt(xf). Furthermore, in such a world it makes no difference whether markets reopen after initial trading. If markets were to reopen, investors would be content to maintain the positions they obtained initially (cf. Arrow, 1968). The situation becomes more complicated if markets are imperfect or incomplete or both. Ownership ofthe stock implies not only ownership of a dividend stream but also the right to sell that dividend stream at a future date. Investors may be unable initially to achieve positions with which they will be forever content, and thus the current stock price may be affected by whether or not markets will reopen in the future. If they do reopen, a speculative phenomenon may appear. An investor may buy the stock now so as to sell it later for more than he thinks it is actually worth, thereby reaping capital gains. This possibility of speculative profits will then be reflected in the current price. Keynes (1931, Ch. 12) attributes primary importance to this phenomenon (and goes on to suggest that it might be better if markets never reopened).

Beta as a Random Coefficient

Abstract: After Markowitz [14, p. 100] and Sharpe [19, 20] suggested estimating the beta systematic risk coefficient for market assets, finance professors, stock brokers, investment managers, and others began expending large quantities of resources each year on estimating betas. Unfortunately however, it appears that the ordinary least-squares (OLS) regressions used in nearly every instance may be inappropriate. This paper suggests that many stocks' beta coefficients move randomly through time rather than remain stable as the OLS model presumes.

Realized Returns on Common Stock Investments: The Experience of Individual Investors

Abstract: Over the last decade and a half, individual investors in the aggregate have consistently been net sellers of corporate common stocks; simultaneously, the holdings of equities by mutual funds, pension funds, insurance companies, and bank trust funds on behalf of individuals have increased dramatically (Soldofsky 1971; U.S. Securities and Exchange Commission 1971; Board Virtually all existing empirical studies of the American capital market deal with the investment performance record of institutions. The present paper offers data on the investment experiences of a large and representative sample of individual investors, based on a 7-year history of actual trading behavior. Those experiences suggest some reasonable skill in security selection, particularly in connection with shortterm trading cycles. Transactions costs, however, have a substantial impact on realized net returns, rendering the overall performance results observed similar to those available from passive investment strategies over corresponding calendar periods. Financial support for the investigation was provided by the National Bureau of Economic Research, the Investment Company Institute (ICI), the Purdue Research Foundation, the College of Business at the University of Utah, and the brokerage house from whose customer group the investor sample was drawn. The computations were performed at the computer centers of Purdue University and the University of Utah. A substantial portion of the requisite securities price data were obtained from the Wells Fargo Bank of San Francisco, which made available its stock data file to Purdue for the research. Particular thanks are also due: William Elbring of Purdue for his contributions to the computer programming effort; Robert Lipsey and Christine Mortensen of the NBER for their counsel and administrative support; Alfred Johnson of the ICI; James Lorie, Myron Scholes, and Lawrence Fisher of the University of Chicago, for the opportunity to review the findings at seminars sponsored by the Center for Research in Security Prices; James Jenkins, Donald Farrar, and Ramon Johnson of the University of Utah; Edgar Pessemier, Frank Bass, and Donald King of Purdue University; John Lintner of Harvard University; and Marshall Blume of the University of Pennsylvania. The responsibility for the findings is, of course, the authors' alone. While the paper represents a segment of an NBER project, it has not undergone a full critical review by the NBER and should not be considered an official NBER publication.

A Note on the Price Behavior of Far Eastern Stocks

Abstract: * The stock price behavior of most developed countries has been known to follow the random walk process, eg, in Fama's (3) study on US stocks, Soinik (7), Theil and Leenders (8), and Dryden's (2) work on European stocks An interesting result emerges from the comparison of these studies: that although the random walk hypothesis would adequately depict the behavior of European stock markets, the deviation from a random walk is more apparent in European exchanges than in the US An accepted explanation takes into account the differences in the institutional characteristics of the two markets; such as, stringencies of disclosure requirements, control on inside trades, thinness of markets, and discontinuities of trading, etc (7) If the degree of "structure" or "organization" affects the degree of conformity to the random walk process, then we should expect countries, whose stock exchanges are not as "organized" as the European or US exchanges-eg, lesser degree of regulations or disclosure requirements-to exhibit greater deviation from a random price behavior Consequently, it would be interesting to see the results if similar tests were performed on stock prices from nonUS or European exchanges In the following, we will discuss results of serial correlation for five Far Eastern countries: Australia, Hong Kong, Japan, Philippines, and Singapore These results are then compared to those of the previous studies on US and European stocks

Employee Stock Ownership Plans

Abstract: ESOP ESOP stands for " employee stock ownership plan. " ESOPs are like profit sharing plans, but must be invested " primarily " in employer stock, and offer special tax advantages to the employer sponsor, its employees and stockholders. One major advantage is its ability to borrow money to purchase employer stock. This is called a " leveraged ESOP. " Leveraged ESOPs 1. Employer establishes ESOP plan and trust. 2. Bank loans money to ESOP, generally with Employer guaranteeing loan (or Lender loans money to Employer, which makes simultaneous " back-to-back " loan to ESOP). 3. ESOP uses loan proceeds to purchase stock from Employer or its existing stockholders. The stock may then be used as collateral for loan to ESOP. Employer or stockholders may use proceeds for any purpose. 4. Employer makes annual tax-deductible contributions to ESOP, which uses them to pay off loan. 5. As loan is repaid, a proportional amount of stock is allocated to accounts of employees. Employees receive stock (or value of stock in cash) when they retire or terminate employment.

Welfare Implications of Grain Price Stabilization: Some Empirical Evidence for the United States

Abstract: This empirical study demonstrates that, although United States producers and consumers taken together benefit from policies which would stabilize feed grain prices, this is likely not the case for wheat. The model specifies a U.S. domestic demand relationship for food and feed use, a stock relationship and a foreign demand sector; these are estimated by ordinary and two-stage least squares methods. The key to the analysis is in testing a well-known theoretical model in which the desirability of price stabilization largely depends on the source of instability (i.e., whether instability is generated abroad or is created internally).

Method, composition and product with improved adhesion between a metal member and a contiguous rubber skim stock

Abstract: OF THE DISCLOSURE: This invention is directed to a method, a rubber skim stock and a product containing the skim stock having improved adhesion between a-metal member and contiguous rubber skim stock The invention lies in the discovery that improved rubber-to-metal adhesion can be obtained by adding to an otherwise conventional rubber skim stock composition appropriate amounts of a tetracarboxylic dianhydride The method of this invention comprises the steps of mixing a tetracarboxylic dianhydride into a rubber composition, bringing this composition into contiguous relationship with a metal member in an unvulcanized product and vulca-nizing the product to yield the end product

Return policies for an inventory system with positive and negative demands

Abstract: We consider a single item inventory system with positive and negative stock fluctuations. Items can be purchased from a central stock, n items can be returned for a cost R + rn, and a linear inventory carrying cost is charged. It is shown that for minimizing the asymptotic cost rate when returns are a significant fraction of stock usage, a two-critical-number policy (a,b) is optimal, where b is the trigger level for returns and b – a is the return quantity. The values for a and b are found, as well as the operating characteristics of the system. We also consider the optimal return decision to make at time zero and show that it is partially determined by a and b.

Short Interest: Its Influence as a Stabilizer of Stock Returns

Abstract: Short interest is the number of shares of a stock borrowed for sale (and not yet replaced) by investors who anticipate a decline in the stock's price. After its price falls, the stock is purchased to replace the borrowed shares, the selling price being higher than the purchase price whence the profit. The New York and American Stock Exchanges disclose the current outstanding short interest for the market as a whole and for selected stocks around the 15th of each month.

A Minimax Ordering Policy for the Infinite Stage Dynamic Inventory Problem

Abstract: This paper obtains closed form expressions for minimax ordering decisions in a dynamic inventory problem in which demands in successive periods are independent random variables that have known finite mean and variance, but whose distributions are otherwise arbitrary and may change from period to period. We assume zero setup cost, linear holding and backlogging costs, and immediate delivery of orders. The situation of a decision maker facing this unknown sequence of demand distributions can be viewed as a sequential zero-sum game against nature. A minimax ordering policy is one that minimizes the maximum expected discounted cost over the planning horizon, where the maximum is taken over all the probability distributions in the class described. A limiting base stock policy characterizes a minimax ordering policy for the infinite-stage model. We show that the limiting base stock policy is an optimal stationary policy for a finite horizon model if the terminal value function --cx is used. We also obtain conditions under which a myopic minimax ordering policy exists for an inventory model when the class of demand distributions is allowed to be nonstationary.

Inflation and the Excess Taxation of Capital Gains on Corporate Stock

Abstract: The present study shows that in 1973 individuals paid nearly $500 million of extra tax on corporate stock capital gains because of the distorting effect of inflation. A detailed analysis shows that...

An application of the logistic density on a stochastic continuous review stock control model

Abstract: We consider a so-called (R, Q) stock control system with stochastic lead time in which a quantityQ is ordered as soon as stock on hand plus on order is lower than a fixed reorder pointR.

Stock control system in automatic stock house

Abstract: PURPOSE:To save labour for checking the actual quantity of stocks at the stocktaking or distribution of parts by exactly knowing the actual quantity of stocks in a stock house, using a computer

Bilan des recherches sur la crevette rose Penaeus duorarum notialis de Côte d'Ivoire et conséquences en matière d'aménagement

Abstract: A summary of results obtained from 1969 to 1977 is given. It concerns the biology of the species (ecology and distribution of the adults, behaviour and diel variation of catch rates, reproduction and larval migration, juveniles migration and recruitment at sea, sexual maturity, growth and mortality by marking experiments) and the history of the fishery (catches, efforts, seasonal variations of catch rates). The combined use of a dynamic pool model of Ricker and a production model of Fox leads to the evaluation of the potential of the stock. The simulation of different and combined fishery strategies on adults at sea and juveniles in lagoons, allows the evaluation of the consequences (in yield, value, biomass and potential fecundity) of the different proposed management procedures (reductions in fishing effort, closed seasons on both fisheries).

The role of metabolisable energy in feeding systems.

Abstract: Most of the feeding systems at present in use in the world were developed in northern Europe or north America where winters are long and livestock have to be housed for a large part of every year. They were developed in-response to practical needs, Farmers wished to know how to allocate reserves of conserved feed and how to plan purchases so to maintain the productivity of their stock. They posed questions of three types, Firstly they wished to know what production they could expect from a particular ration, secondly how to manipulate quantities of feed to obtain a particular production, and thirdly how they could estimate how much of one feed could be substituted for another without affecting production of meat and milk, Each one of these questions predicates an ability to control the quantity of each feed given to the animal.

In search of hunt's short-run price cycles in the sydney wool futures market

Abstract: The structure of prices of Sydney wool futures contracts is examined with the aid of spectral analysis. Although the series studied are not strictly random walks, it is shown that there is little useful information for forecasting contained in the historical price data. It is concluded that the behaviour of prices on the Sydney wool futures market is essentially the same as that observed for the majority of stock and futures price series from other markets.

Bond Equivalents of Stock Returns

Abstract: A ny bond portfolio manager considering diverting a portion of his long-term bond money into high yielding common stocks should recognize that he is undertaking a very complex evaluation. Vast differences exist between the bondholder and the stockholder. The bondholder is a creditor. The stockholder is an owner, and must accept all the special risks and uncertainties of corporate ownership. As investment vehicles, there are fundamental differences between bonds and stocks. Each specific bond-tostock situation requires a probing analysis of these differ ences . If a bond portfolio manager makes a deliberate decision to accept the added risk that is clearly associated with common stock, then there arises the calculational problem of insuring that any comparisons of stockto-bond returns are based upon a mathematically consistent procedure. These comparisons often take the form of viewing the stock's estimated rate of return in terms of an interest rate spread over the bond's conventional yield-to-maturity. Even when there is a full recognition of all the risks and uncertainties involved in any given estimate of a stock's rate of return, any such spread comparison will still suffer from a rather substantial problem of computational technique. Such stock-to-bond comparisons are analogous to looking solely at conventional yields when evaluating a straight bond-to-bond swap over a long-term horizon. For a compounding bond portfolio, this conventional yield comparison can be misleading, because it neglects the effect of coupon reinvestment. When this reinvestment effect is properly taken into account, low coupon discount bonds display a structural advantage over par bonds that is not reflected in the conventional yield spread. 1. Footnotes appear at the end of the article. ' For stocks that might be considered as potential bond substitutes, estimates of the long-term rate of return are often based upon some form of the dividend growth model. The use of such a highly simplified model in itself represents a major investment decision, especially in light of the model's tacit assumptions that the stock's dividend producing capability will remain in a continual uptrend and that the company's credit

Red deer farming

Abstract: SUMMARY An experimental deer farm has been in operation on heather dominant upland in Kincardineshire since 1970 where the Rowett Research Institute and the Hill Farming Research Organisation have been exploring the possibility of intensifying venison production from such land. Six years' experience indicates that a tame foundation stock of red deer is a feasible basis for making good use of such land for the production of lean deer meat.