Recent Finance Publications

 

For a list of past articles click here

Identifying the Gap Between Student and Faculty Expectations: Report from a Business School
Journal of the Academy of Business Education, Vol. 7, pp. 44-51, Spring 2006 
Marie McKendall, Yatin Bhagwat, Daniel C. Giedeman, Helen A. Klein, and Nancy M. Levenburg
2006
The authors of this paper are faculty members in the business school of a medium-sized (e.g., 21,000 students) comprehensive state university. In recent years, anecdotal evidence indicated that frustration levels between faculty and students in the business school had been steadily rising. The issue came to the forefront in November 2002 when a faculty member, troubled by unsatisfactory student work and hostile reactions to senior course requirements, asked that the faculty consider how students who were seniors apparently believed that low quality work would suffice and that they should not be asked to work too hard. Faculty overwhelmingly agreed that faculty standards and student expectations had both fallen too low.
 
 
Money Talks
MiBiz Network
Greg Dimkoff
2006
About $1 in every $8 invested in equity mutual funds is invested in socially conscious funds. That’s not peanuts— the total dollar amount exceeds $2 trillion. A question I often hear is whether or not investing in such funds hurts or helps investment returns.
 
West Michigan Stock Returns
Seidman Business Review, Vol. 12, Winter 2006
Greg Dimkoff
2006
Stocks of companies based in West Michigan usually outperform the national market indexes. That happened again in 2005, sort of. Table 1 below shows that West Michigan stocks outperformed both the Dow Jones Industrial Average and the NASDAQ Composite Index but fell short of the S & P 500 Index 500 Index.
 
Predictors of Performance in an Online Financial Management Simulation
Annual Meeting of the Financial Education Association, San Antonio, TX, April 5-6
Thomas Willey, Susan Edwards, Vijay Gondhalekar
2006
Simulations are being utilized to a greater extent in the business curriculum to provide students with a “participative, interactive, and applied” (Gentry, 1990) method of learning. We investigate whether the student’s age, gender, performance in introductory level finance courses, GPA, or work experience impact his/her learning outcomes in a simulation based learning exercise, FinGame (Brooks, 2004). For our sample of 164 students taken over a two-year period, we find that only GPA is a significant predictor of a student’s success in the financial management simulation. 
 
Is Momentum Investing A Viable Strategy For Individual Investors?
MFA’s 55th Annual Meeting, Chicago, IL, March 2006
Glenn Pettengill, Susan Edwards
2006
Momentum investing is the practice of investing in securities that have substantially outperformed the market in recent periods. This practice has been discussed in both the practitioner and the academic literature, but to date no study has examined this behavior on the part of a group of investors. This paper examines the selections of a group of individual investors to determine the extent to which they practice momentum investing and are successful with this strategy. Comparisons are made to selections of a group of professional analysts choosing stocks under the same circumstance. We find that both groups do engage in momentum investing. Overall, the individual investors exhibit a stronger tendency to be momentum investors, but the professional analysts appear to be more consistent and successful with the strategy. 
 
The Impact of the Repeal of the Glass-Steagall Act on the Risk Characteristics of Commercial Banks
MFA’s 55th Annual Meeting, Chicago, IL, March 2006
Vijay Gondhalekar, Sridhar Sundaram
2006
The GLBA was legislated and made into law on November 12, 1999. The main objective of the GLBA was to remove the regulatory barriers of banks, insurance companies, and securities firms, and enable them to do business in all areas of the financial services industry. It was hoped that the removal of regulatory barriers would enable financial institutions take advantage of the economy of scale and scope and other benefits that large and diverse industries provide, and eventually benefit consumers. 
 
Tests of Overreaction and Under reaction Hypothesis for Momentum Returns
Glenn Pettengill, Sridhar Sundaram
2006
This paper examines the momentum returns from portfolios constructed using the NYSE-AMEX stocks. Following the methodology of Jegadeesh and Titman (2001) we form the momentum portfolio by going long on winners, defined as securities with returns in the top decile of previous six-month cumulative return, and short on losers, defined as securities with returns in the bottom decile of previous six-month cumulative return. Consistent with previous literature, we find that momentum portfolios earn significantly higher returns in the six-month period following the formation period. But, we also find that loser portfolios earn returns significantly greater than zero during this period. Further examination of the returns to the momentum portfolio during up and down markets and during each month of the year reveal a strong seasonality in these returns. These empirical results fail to support neither the under reaction nor the overreaction hypothesis. Further research is needed to examine the sources of these momentum returns.
 
 
Is Momentum Investing a Viable Strategy For Individual Investors?
MFA’s 55th Annual Meeting, Chicago, IL, March 2006
Glenn Pettengill, Susan Edwards, and Dennis Schmitt
2006
Momentum investing is the practice of investing in securities that have substantially outperformed the market in recent periods. This practice has been discussed in both the practitioner and the academic literature, but to date no study has examined this behavior on the part of a group of investors. This paper examines the selections of a group of individual investors to determine the extent to which they practice momentum investing and are successful with this strategy. Comparisons are made to selections of a group of professional analysts choosing stocks under the same circumstance. We find that both groups do engage in momentum investing. Overall, the individual investors exhibit a stronger tendency to be momentum investors, but the professional analysts appear to be more consistent and successful with the strategy.
 
Profitability Study of MPAA Rated Movies
Seidman Business Review, Vol. 12, winter 2006
Sridhar Sundaram
2006
Concerned with the limited number of family oriented films currently produced each year and an increase in the number of films containing sex and violence, The Dove Foundation is interested in determining which films, by MPAA rating, produce the greatest profits as well as the highest rates of return on investment (ROI).
 

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