Independent Investors Research Articles

Optimal Timing and Probability Study of Generation Firm Investment under Power Price Uncertainty

Abstract Reformation of the power industry makes generation companies become independent investors in power market, this article studies investment decisions of generation companies. On the basis of basic investment principle that generation companies always are in pursuit of maximum profit from investment, it is analyzed how power price fluctuation property affects the timing and the probability of generation capacity project investment exercise through martingale and change of measure in this article. The studies show that generation companies generally delay investing under energy price uncertainty, and capacity price has much incentive to invest in capacity project. The conclusion indicates that uncertainty is the cause of investment risk, increase in uncertainty of energy price raises investment risk of generation companies, and reduces the probability of generation project investment exercise.

Electricity restructuring [the business scene

The Islamic Republic of Iran currently manages an electricity sector with about 40,000 MW of installed capacity, which serves more than 13 million end users through a 36,000-km high-voltage transmission interconnected grid and a more than 50,000-km medium-voltage distribution network. This fairly large power system with an annual peak demand growth rate of about 10%, one of the highest rates in the world, makes the movement toward restructuring the electricity industry of Iran unavoidable, mainly for two reasons: 1) it is expected that the restructuring and consequently the privatization would improve the performance and efficiency of the present industry 2) it is expected that the development of a new competitive paradigm in the electricity industry could make the sector more attractive for potential independent investors. Based on these ideas, the restructuring studies primarily were begun in early 1990. The studies had two main directions: providing legal foundations and determining the main implementation steps. This article discusses these two directions

Today or not today: Deregulating the Russian gas sector

Although Russia is the world's biggest producer of natural gas, its ability to maintain timely and reliable supply to meet the growing global demand has come under question in recent months. The gas war with Ukraine notwithstanding, concern has been raised by a number of observers that underinvestment in the gas sector will lead to a systemic failure of the state monopolist OAO Gazprom to increase or even maintain current levels of production. Yet with a quarter of European gas coming from Russia, and with increasing presence of Gazprom in European downstream operations (such as Germany, Hungary, and other CIS states) as well as seemingly closer ties with Algeria, another major supplier of gas to Europe, there has been a strong reaction from Europe's policy-makers to decrease dependence on Russian gas. Deregulating and liberalising the gas sector would see the lifting of restrictions to foreign or independent investors wishing to gain access to Russian reserves, as well as the unhindered access to the pipeline infrastructure and export markets. It would also signal the unbundling of Gazprom and an end to the artificially low price of gas to the domestic consumer. This paper discusses whether deregulation is the optimal way to raise capital, attract investment and increase supply security for Russia's Western neighbours. In doing so, the paper identifies the objectives of the EU as the importer whilst trying to align them with the objectives of the Russian Federation as the exporter, in the current political context.

Building users, owners and service providers: new relations and their effects

Corporate real estate management has undergone important changes in many countries. In recent years, companies have increasingly sold their facilities to external independent investors or placed their real estate in semi‐independent subsidiaries. Both manufacturing companies and real estate companies increasingly prefer to buy facilities management services from external contractors. This implies that new relations between users, owners and service providers emerge, where roles are separated in different legal entities without ownership links and are related to each other by explicit and formal contracts. This paper describes the Swedish development and discusses consequences for roles, relations and decision processes. Three key research areas are identified: how space supply and service management may be related to strategic levels of the core business; management of formal and informal aspects of interfirm relations over time; and decision making in the area of flexibility, generality and user adaptation of workspace.

Pleasing the interested investor: the rational basis for the compensation of corporate executive officers

In the aftermath of the Enron scandal, the critics of free enterprise have blamed this system for inflated and out of control executive salaries, particularly those of the chief executive officer (CEO). The present paper defends the marketplace against these charges. In section I we argue that the market has passed the Enron test with flying colors. Section II gives the background of the financial situation relating to CEO salaries. Sections III and IV are devoted to, respectively, the tax court and the appellate court; section V looks at the reaction of the former to the latter; and in section VI we defend the “independent investor” test. We look at this issue from a political economic perspective in section VII and conclude in section VIII.

Improving Fund Risk Management by Using New Software Tools Technology

This paper introduces a new MATLAB-based toolbox for Computer Aided mutual fund risk evaluation. In the age of computerized trading, financial services companies and independent investors must quickly investigate fund investment style and market risk. The Fund Risk toolbox is a financial software that includes a set of functions based on value at risk (VaR) and expected tail loss (ETL) methodology for graphical presentation of risk forecasts, evaluation of different risk models and identification of fund investment style. The sample of historical data can be divided to an estimation rolling window and the back-testing period. MATLAB?s vast built-in mathematical and financial functionality along with the fact that is both an interpreted and compiled programming language make this toolbox easily extendable by adding new complicated risk models with minimum programming effort.

The role of informal contracts in the growth of small cattle herds on the floodplains of the Lower Amazon

In the absence of access to formal credit, informal contracts with independent investors give the small ranchers of the Lower Amazon an acceptable means through which to surmount the high investment hurdle of starting a cattle herd. These contracts – called sociedades – allow small ranchers to raise an outside investor's cattle in return for a portion of the offspring and are commonplace in the cattle production systems of the Amazon. But, notwithstanding a vast literature on cattle production in the Amazon, informal contracts have been largely overlooked. This paper presents the results of a field survey and financial analysis for informal contracts on small ranches in the Lower Amazon. In the results, we suggest that informal contracts are an important means of cattle herd start-up and herd production for small ranchers. Internal rates of returns in cattle production under these contracts are in the range of –7 to –12% for the small rancher and 12% for the investor. The net present value of the contract to the small rancher ranges from –R$1219 to –R$8599 and from R$1681 to R$8845 for the investor, for a 10-year period, depending on herd size. Financial returns contracts are sensitive to the contract design – e.g., to who pays health costs – and to beef prices. The small ranchers have a negative IRR, lose money, and bear all the risk of loss, yet persist in using this form of herd development. We surmise that this is due to the non-financial benefits of cattle ownership and the lack of access to formal credit structures. In conclusion, although outside the formal economy and apparently financially unrewarding, these contracts are an important mechanism by which the small ranchers on the Amazon Floodplains create cattle herds.

Offshore investors place their chips on Chinese foundries

Judging China an electronics superpower in the making, large corporations like Japan's NEC, as well as independent Taiwanese investors, are racing to set up semiconductor wafer fabrication lines within its territory. This paper examines how, all the same, given the overall downturn in the chip sector, some observers wonder whether this is the right time for companies to start building expensive fabs in China.

The Perception of Real Estate Investment Opportunities in Southeast Asia

This research uses two independent investor surveys undertaken in Singapore and the UK to examine the attitudes and perceptions towards property investment opportunities in the Southeast Asian region. The analysis considers the characteristics of investors active in the Southeast Asian property market and factors influencing their decision-making process. The results show that market players target neighbouring countries where investment characteristics are familiar. This study also shows that there are differential behaviour patterns regarding risk perceptions across the two cohorts of investors. Differences in attitudes between a regional player (Singapore) and a foreign player (UK) in the Southeast Asia region may partially be explained by the risk averse behaviour of institutions.

Patterns of behavior of professionally managed and independent investors

In this paper, we analyze the investment patterns of a large number of clients of a major Israeli brokerage house during 1994. We compare the behavior of clients making independent investment decisions to that of investors whose accounts were managed by brokerage professionals. Our main objective is to investigate whether the disposition effect (i.e., the tendency to sell winners quicker than losers), demonstrated in the US only for individual investors, also holds for professional investors. This analysis is important, as accepted financial theory predicts that prices are determined mainly by decisions made by professionals. We show that both professional and independent investors exhibit the disposition effect, although the effect is stronger for independent investors. The second objective of our study is the comparison of trade frequency, volume and profitability between independent and professionally managed accounts. We believe that these comparisons not only provide insights of their own, but also help to put the differences in the disposition effect in a wider perspective. We demonstrate that professionally managed accounts were more diversified and that round trips were both less correlated with the market and slightly more profitable than those of independent accounts.

Patterns of Behavior of Professionally Managed and Independent Investors

In this paper, we analyze the investment patterns of a large number of clients of a major Israeli brokerage house during 1994. We compare the behavior of clients making independent investment decisions to that of investors whose accounts were managed by brokerage professionals. Our main objective is to investigate whether the disposition effect (i.e., the tendency to sell winners quicker than losers), demonstrated in the US only for individual investors, also holds for professional investors. This analysis is important, as accepted financial theory predicts that prices are determined mainly by decisions made by professionals. We show that both professional and independent investors exhibit the disposition effect, although the effect is stronger for independent investors. The second objective of our study is the comparison of trade frequency, volume and profitability between independent and professionally managed accounts. We believe that these comparisons not only provide insights of their own, but also help to put the differences in the disposition effect in a wider perspective. We demonstrate that professionally managed accounts were more diversified and that round trips were both less correlated with the market and slightly more profitable than those of independent accounts.

Do ESOPS Strengthen Employee Stakeholder Interests?

extract] In the first section of this paper, I will discuss generally the ‘stakeholder’ approach to corporations. I will then focus on employees as a distinct group of stakeholders, and establish that under Australian law, employees as stakeholders have less corporate ‘muscle’ than in overseas jurisdictions. Based on this, I will then discuss whether employees as shareholders can promote their claims within the corporate hierarchy, either as members of an employee share ownership plan (ESOP) or as independent investors.

An Investigation into the Effects of Independent Investor Relations Firms on Common Stock Prices

An Investigation into the Effects of Independent Investor Relations Firms on Common Stock Prices

An Investigation into the Effects of Independent Investor Relations Firms on Common Stock Prices: Discussion

An Investigation into the Effects of Independent Investor Relations Firms on Common Stock Prices: Discussion