Investment Funds Research Articles

Stock portfolio optimization for risk-averse investors: A novel hybrid possibilistic and flexible robust approach

This study proposes stock portfolio optimization models for risk-averse investors under uncertain conditions. To accomplish this, the study measures risk based on the conditional drawdown-at-risk (CDaR) measure, which can prevent major declines in investment as a conservative investment strategy. Given the uncertain character of the input parameters of the problem, the study first proposes a hybrid possibilistic and flexible model by considering the CDaR measure (CDaR-HPFM) to handle uncertainty. Furthermore, to offer more robust outcomes, the study constructs a hybrid possibilistic and flexible robust model by considering the CDaR measure (CDaR-HPFRM), in the forms of a non-linear and a linear mathematicalprogramming problem. The CDaR-HPFRM can process the robustness of output decisions while dealing with uncertain parameters. The real stock exchange data of 100 companies registered on the Tehran Stock Exchange are investigated to validate the functionality of the proposed models. The results reveal that, when various penalty costs are factored in, the CDaR-HPFRM yields more efficient and more robust results than the CDaR-HPFM. Comparative results also indicate that the proposed models almost always outperform existing methods, in terms of both CDaR and rate of return measures. Proposed models can be used for all types of stock market investments (including micro-investing and investment funds) and can handle portfolio optimization and selection processes in project-based organizations.

Stakeholder interfaces for excess heat-based urban heat supply— Input from Swedish cases

Excess heat is generated from different industrial processes and from urban infrastructure (sewage water, transport, datacentres and buildings). Thirty-five percent of the European energy demand for heating and cooling could be met by excess heat. Today, however, this energy reserve is barely exploited. There are known barriers to excess heat recovery but limited information on stakeholder interactions in the early stages of excess heat collaborations and on successful collaborations. Sweden is world champion in terms of excess heat recovery into district heating systems, and the country has a long tradition in this field (dating back to the 1970 s). By studying two cases, we shed light on success factors in the early stages and in successful collaborations. We identify that the main success factors for excess heat recovery are (i) trust between the collaborating partners, (ii) the involvement of as many stakeholders across the DH (District Heating) value chain as possible (in the decision-making process), (iii) the establishment of joint goals, and (iv) the identification of a business model allowing for a win-win solution that prioritizes excess heat recovery and secures funding for the necessary investments. Excess heat recovery investments have features similar to those of other investments in climate change mitigation, making the success factors relevant to applications beyond the case of excess heat recovery.

Impact of Investment, Funding, and Profitability on Indonesian Manufacturing Firm Valuation

This research seeks to examine the impact of investment decisions, funding choices, dividend policies, company growth, and profitability on the valuation of manufacturing firms listed on the Indonesia Stock Exchange from 2020 to 2022. The analytical approach employed involves multiple linear regression analysis, utilizing annual data collected from manufacturing companies listed on the Indonesia Stock Exchange within the specified timeframe. The research sample consists of 135 selected entities determined through the purposive sampling method. The outcomes of the research reveal that investment decisions exert a negative impact on company value, whereas funding and profitability decisions demonstrate a positive influence on company value. However, dividend policy and company growth do not exhibit a statistically significant effect on company value. These results contribute to a more profound comprehension of the determinants shaping company value within the realm of manufacturing companies in Indonesia. This could serve as a reference for corporate managers when formulating strategic decisions to enhance their company's value. It is anticipated that future research endeavors may build upon this research by incorporating additional variables with potential impacts on company value, such as capital structure.

CROSS BORDER MERGERS & ACQUISITIONS ALONG WITH REGULATIONS OF OVERSEAS INVESTMENT AND SEBI

Cross-border mergers and overseas investments by “Alternative Investment Funds” (AIFs) and “Venture Capital Funds” (VCFs) are two significant mechanisms facilitating capital movement across borders in the globalized economy. This paper provides an in-depth analysis of the regulatory frameworks and operational dynamics of both mechanisms, comparing and contrasting their objectives, entities involved, regulatory requirements, and risk-reward profiles. Cross-border mergers involve the consolidation of companies from different jurisdictions, aiming to achieve synergies, expand market presence, or leverage complementary strengths. The regulatory landscape governing cross-border mergers includes provisions under the Companies Act, of 2013, “The Foreign Exchange Management Act” (FEMA), and Competition Act, of 2002, among others. These mergers entail adherence to complex legal and regulatory frameworks, including approvals from regulatory authorities, compliance with foreign exchange laws, and fulfilment of competition norms. Despite the potential benefits, cross-border mergers also pose integration challenges, cultural differences, and regulatory uncertainties. In contrast, overseas investments by AIFs/VCFs enable domestic investors to diversify their portfolios by accessing opportunities in offshore companies, typically startups or emerging enterprises. The regulatory framework for these investments is overseen by the “Securities and Exchange Board of India” (SEBI) and includes guidelines, circulars, and compliance requirements. While regulatory compliance is necessary, the process may be relatively streamlined compared to cross-border mergers. Furthermore, the paper discusses the distinct objectives, entities involved, and risk-reward profiles of cross-border mergers and overseas investments by AIFs/VCFs. Cross-border mergers primarily involve established companies seeking strategic alliances or expansion opportunities, while AIFs/VCFs focus on deploying capital into high-growth opportunities, often at early stages of development. Overall, understanding the nuances of both mechanisms is crucial for businesses, investors, and policymakers to navigate the complexities of the globalized economy and make informed decisions regarding cross-border transactions.

What Determines Global Flows of Entrepreneurial Finance?

Economists examine foreign direct investment, which mostly constitutes flows to established firms (sometimes characterized as “multinational corporations”) that might or might not engage in truly innovative activity in the FDI target country. Conversely, finance scholars have studied the pipeline of entrepreneurial finance from limited partnerships (LPs) to venture capitalists (VCs) or private equity general partners (GPs) to portfolio firms. Few studies examine relationships between general and limited partners, and those that do often examine only the United States, or a limited number of countries in a given region. This paper uses a novel dataset (LP Source) to examine secular trends in cross-national flows from the LP to the GP (in the form of various investment funds) to the portfolio firm. We find evidence for “home bias” and demonstrate that cross-border flows are affected by GDP per capita, export orientation, and country-level measures of the entrepreneurial environment.

Contributions of Startups to the Growth of the Indian Economy: A State Wise Analysis

The paper investigates the complex effects of startups on the resilience and growth trajectory of the Indian economy. It explores the ways in which these young, creative businesses are promoting dynamism and adaptation, especially in the face of economic difficulties. The report clarifies government programs that give emerging businesses critical financial support, such as the Startup India Seed Fund Scheme (SISFS) and Alternative Investment Funds (AIFs) under the Fund of Funds for Startups (FFS). The article intends to reveal the role of startups in driving inclusive economic growth, fostering technological advancements, and creating jobs by analyzing their individual contributions across different sectors. The study also looks into how entrepreneurs are promoting India as an innovation hub and raising the country’s global competitiveness. Policymakers, investors, and entrepreneurs will all benefit from this investigation’s insightful findings, which emphasize how important it is to support a strong startup ecosystem in order to have a vibrant Indian economy.

A study on investor awareness about investment of mutual fund.

A study on investor awareness about investment of mutual fund.

Modeling the Optimal Distribution of an Enterprise’s Resources

"In the modern economy, optimizing the use of resources is a key factor in ensuring the success of a company. This article optimizes the allocation of enterprise resources to maximize profits, which contributes to the sustainable development of both the enterprise and the economy of the state. To achieve this goal, the authors have developed a model for the optimal allocation of enterprise funds. The article considers various methods to allocate investor funds to maximize profits. It is concluded that it is impossible to increase income without increasing risk or reduce risk without reducing profit. The portfolio that contains the riskiest assets will be the most diversified and bring the best return per unit. To assess the sustainable development of an enterprise with due regard to its possible risks, it is not enough to use only quantitative methods of risk analysis. It is also necessary to develop a comprehensive methodology that would consider all possible risks typical of Russian enterprises."

Unveiling the impact of foreign investment entry in industrial clusters: the case of Castelló and Sassuolo

ABSTRACT This paper explores the impact of foreign investment, through acquisitions and mergers of local firms, on leading industrial clusters. While previous research has highlighted the increasing involvement of cluster firms in internationalization and knowledge globalization, the role of foreign investment requires further investigation. Power asymmetries between MNEs and partner firms are prevalent in global value chains, joint ventures, and strategic alliances, shaping the contemporary global economy. By analysing two clusters specialized in ceramic tile production (Castelló, Spain, and Sassuolo, Italy), this study aims to evaluate the impact of foreign investment on leading clusters, specifically distinguishing between multinational enterprises (MNEs) and investment funds. The research examines the perceived effects through a qualitative analysis, capturing the subjective impressions of local actors involved in acquired firms, independent local firms, technological suppliers, and supporting institutions. This paper contributes to the literature by addressing contradictory findings and providing insights into the balance between knowledge absorption and spillovers from MNEs or investment funds to local firms.

Do large registered investment funds undermine shareholder activism? Evidence from hedge fund proposals

We examine the voting behavior of Registered Investment Funds (Mutual Funds, ETFs and Close-end Funds) on Hedge Funds proposals, a common vehicle of value-driven shareholder activism. We compare the support rates of Registered Funds versus other voting shareholders on different types of proposals set up for voting at shareholders meetings and explore fund-level characteristics that may explain the variation in support rates. Our results show that Registered Funds support rates on Hedge Fund proposals vary depending on the proposal category. In general, the support rates of Registered Funds are about 4 percentage points lower compared to other investors. However, that difference rises to 10 p.p. for proposals that are more confrontational to the incumbent management of the target company. Interestingly, the average lower support rates of Registered Funds are driven by the ten largest funds. On the contrary, Registered Funds from smaller parent groups tend to be more supportive of Hedge Fund activism. We document a 18 p.p. reduction in the probability of favorable votes on Hedge Fund proposals by the largest Registered Funds compared to smaller funds. Our results suggest that the growing ownership in public companies by large Registered Funds reduces the overall support of shareholder activism through Hedge Fund proposals.

Enhancing Analytical Precision in Company Earnings Reports through Neurofuzzy System Development: A Comprehensive Investigation

The object of research is the fundamental and technical indicators of companies after the release of the earnings report. This study attempts to address the issue of understanding the impact of fundamental and technical analysis indicator dynamics on profits and loss news releases. This research provides an in-depth analysis of stock price forecasting models, focusing on the influence of earning report seasons as catalysts for stock price growth. The study explores the relationship between key financial indicators, including earnings per share (EPS), revenue, and the maximum price observed in the 52-week period of the previous year (MaxW52). A trading algorithm is developed based on the adaptive neurofuzzy inference system (ANFIS). Through a comprehensive analysis of the neural network’s training sample, it is concluded that abnormally large negative indicators have a profound impact on traders’ emotional reactions. This results leads to a hypothesis for further research, suggesting that report indicators may be processed by computational algorithms, potentially including artificial intelligence (AI). Consequently, the emergence of emotional trading robots managed by investment funds becomes a crucial area for investigation. Understanding the behavior of these algorithms enables proactive decision-making, allowing traders to leverage their knowledge and sell-purchased securities to these algorithms before their transactions occur. The implications of this research shed light on the evolving landscape of trading strategies and the role of emotionality in financial markets.

Asset pricing and the carbon beta of externalities

Climate policy needs to set incentives for investors who face imperfect, distorted markets and large uncertainties about the costs and benefits of abatement. These investors decide on uncertain investments according to their expected return and risk (carbon beta). We study carbon pricing and financial incentives in a consumption-based asset pricing model distorted by technology spillovers and time-inconsistency. We find that both distortions reduce the equilibrium asset return and delay investment in abatement. However, their effect on the carbon beta and the risk premium for abatement can be decreasing (when innovation spillovers are not anticipated) or increasing (when climate policy is not credible). We show that the distortions can be overcome by modified carbon pricing by a regulator, or by financial incentives, implemented in our model by a long-term investment fund. The fund pays a subsidy to reduce technology costs or offers financial contracts to boost investment returns to complement the carbon price. The investment fund can thus pave the way for carbon pricing in later periods by preventing a capital misallocation that would be too expensive to correct, thus improving the feasibility of ambitious carbon pricing.

Prospects for the development of legal regulation of Green Recovery in Ukraine

Ukraine has committed itself to developing and implementing long-term measures aimed at reducing greenhouse gas emissions. As a party to the Paris Agreement to the United Nations Framework Convention on Climate Change, the state is obliged to make its nationally determined contribution to achieve the goals of sustainable low-carbon development of all sectors of the economy and increase the ability to adapt to the adverse effects of climate change. The official announcement of joining the European Green Deal demonstrates Ukraine’s unwavering intention to overcome the challenges posed by climate change and environmental degradation by transforming into a modern resource-efficient and competitive economy. In June 2022, Ukraine was granted the status of a candidate for EU membership. These measures should be implemented despite Russia’s anti-Ukrainian armed aggression and difficult economic challenges.
 The purpose of this work is to determine the main directions of development of the legal mechanism for preventing climate change, which is being formed in the context of military realities, while ensuring that Ukraine strictly complies with its obligations under the European Green Deal.
 It is concluded that when developing the conceptual legal framework of the environmental security component as part of the Strategy for Post-War Recovery and Development of Ukraine and the relevant Action Plan, as well as sectoral programs for the restoration of the State, an appropriate climate policy should be formulated, coordinated with Ukraine’s further European integration.
 These include updated priority measures of the national climate policy, broad state support for environmental protection measures; digitalization of environmental relations; provision of funding for measures and investments aimed at developing competitive renewable generation and improving existing infrastructure, developing the potential of the hydrogen ecosystem, increasing the energy efficiency of buildings through the integration of renewable energy sources, decarbonizing insulation and cooling of buildings, ensuring the development of transport with low.

Literasi peran manajemen dan strategi eksistensi UMKM di Kota Semarang

There are many problems currently plaguing UMKM in Indonesia. These challenges include the quality of human resources, inadequate managerial capabilities, limited investment funds and working capital, lack of expertise in marketing strategies and the ability to utilize technology which is still relatively low. UMKM have a lot of room to grow in today's information-based economy, as long as they make good use of existing information technology infrastructure. Therefore, it is very important for stakeholders to continue to carry out outreach, guidance and support for UMKM. Management excellence in the changing dynamics of the Indonesian economy has direct implications for the tactics used by UMKM to survive in the business world, especially in the area of legal compliance. In order for UMKM to grow and develop in today's competitive market, it is important to address legal issues head-on. Through the use of management knowledge, digital technology, and legal registration assistance, community service is realized. It is hoped that UMKM players can remain competitive by maintaining product quality and being able to play a management role in running the gendar cracker business.

Sustainability from Policy to Practice: Assessing the Impact of European Research and Innovation Frameworks on Circular Bioeconomy

Europe leads in shaping circular bioeconomy (CBE) policies for sustainability, relying on dynamic research and innovation (R&I) projects to propel the transition. Increased European R&I investment, fueled by commitment and a societal demand for measurable project returns, lacks a comprehensive evaluation. This study provides an in-depth analysis of the alignment of European-funded R&I projects with CBE policy priorities and assesses their societal impact. Rooted in an interpretive paradigm, it employs content analysis through semi-structured questionnaires to survey project leaders. The study evaluates benefits using the triple bottom line concept and interprets results guided by the theory of change. Our results suggest that European-funded R&I projects actively cultivate a supportive ecosystem for CBE adoption, as evidenced by emerging themes such as knowledge sharing, capacity building, and collaborative learning, aligning closely with investment priorities and funding schemes. The societal impact focuses on the short and medium term, emphasizing the social dimension by committing to empowering individuals, fostering collaboration, and enriching knowledge. Long-term benefits primarily contribute to the economic dimension, highlighting the potential for positive impacts like promoting business growth, innovation, improving market efficiency, and fostering sustainability. This study seeks to enhance the impact of R&I projects and promote a paradigm shift towards sustainability by providing context-specific recommendations.

Pengaruh Keputusan Investasi, Keputusan Pendanaan, Dan Kebijakan DividenTerhadap Nilai Perusahaan Pada Perusahaan Manufaktur Yang Terdaftar Di Bursa Efek Indonesia

This study aims to determine the effect of investment decisions, funding decisions and dividend policies on firm value in manufacturing companies listed on the Indonesia Stock Exchange. This research is a quantitative research that uses secondary data. The secondary data was taken from the year of 2015 to 2019 using a purposive sampling technique. The data analysis technique used multiple linear regression and then processed with SPSS 24 software. The results show that investment and funding decisions have a positive effect on firm value. Meanwhile, dividend policy has a negative effect on firm value. Through this research, manufacturing companies will be able to study the factors that can affect the value of the company.

Methodological recommendations for improving the use of the investment fund of the Belgospischeprom concern

The author’s directions for improving the current mechanism for financing projects from its investment fund in the Belgospischeprom concern are proposed: an algorithm for involving organizations in the financing of investment projects with established efficiency parameters at the expense of the concern’s investment fund and a mechanism for forming its share in the authorized capital of organizations financed from IFC funds. of which the state is not the only shareholder.

Optimization of Portfolio Management Models with Indexed Stocks on the Lima Stock Exchange

Investment fund managers are limited by the fact that Latin American financial markets offer very few investment possibilities, which forces them to carry out operations at a global level. The objective is to optimize the portfolio management models with indexed stocks in the Lima Stock Exchange (27 stocks considering 2082 days from January 02, 2014 to April 13, 2022) applying the Markowitz models that determine the portfolios of the frontier of investment possibilities. The Sharpe model (CAPM), which calculates the expected return considering systemic risks, and the Sharpe index, which measures the stock return with total risk. Finally, the Black-Litterman (BL) model adjusts the ex-post expected return with expert opinion. By comparing the BL/CAPM ratio, an index is obtained that improves the predictability of expected returns and it is observed that the efficiency of this indicator is greater than the Sharpe index of subsequent expected returns (Sharpe BL). Therefore, the hypothesis that optimizing the portfolio management models improves the predictability of the expected returns of the indexed shares of the Lima Stock Exchange is accepted.
 
 Received: 23 July 2023 / Accepted: 10 January 2024 / Published: 5 March 2024

The emergence of financial capital in the health insurance business in Europe: The case of Spain in the last fifty years

Abstract Sickness insurance companies were developed in Spain by doctors and healthcare professionals, remaining outside the interests of general insurance companies. Their management was hardly professional, with limited actuarial techniques and they only accounted for a small percentage of total insurance business premiums. From the 1970s onwards, various factors changed this situation, driving processes of concentration, with numerous takeovers and mergers, first reducing the number of local and regional companies to the benefit of companies of national scope. Subsequently, the growth in demand for this type of coverage sparked the interest of national general insurance companies and multinationals, leading to a restructuring of the sector which has progressively acquired greater weight within the insurance business and become increasingly internationalised. This last stage immersed the health sector in Spain in the great processes of globalisation of the sector, characterised by a financialisation of capital promoted by the bank investment funds. These processes are little known and are the focus of analysis of this paper, with the aim of enabling comparison at international level.

SFDR Article 9: Is it all about impact?

We investigate more than 1,000 investment funds that are classified under Article 9 of the EU Sustainable Finance Disclosure Regulation (SFDR). Using the G7’s new typology of sustainable investments, we show that Article 9 funds pursue varying degrees of ambition: while 60 % follow an impact-oriented strategy, we identify 40 % that instead pursue a general Environment, Social, and Governance (ESG) strategy. We do not find significant differences in ESG scores between ESG-related and impact-related funds. Yet, impact-related funds have higher SDG impact scores and higher management fees. Downgraded funds that changed SFDR status, however, tend to be less focused on impact.