Types Of Investors Research Articles

Searching for safe haven assets against American and European stocks during the Russo-Ukrainian War

Purpose This study aims to evaluate the safe haven property of several assets against the US and European stock markets during the Russo-Ukrainian War in a time–frequency framework. Design/methodology/approach This study uses the wavelet-based dynamic conditional correlation-generalized autoregressive conditional heteroskedasticity (DCC-GARCH) methodology and wavelet coherence on daily returns for the S&P500, STOXX600 and 13 possible save haven assets. Findings The results show that wheat and corn are the best assets to use as hedges and safe havens for all types of investors. The second-ranked are energy commodities, which are hedges and safe havens for long-term investors. Gold, silver and palladium display hedging and safe haven qualities for medium- and long-term investment. However, cryptocurrencies, the Dow Jones sustainability index and Islamic indices do not act as safe havens for most holding periods. Practical implications These findings have significant implications for portfolio investment strategies in times of geopolitical risks. Originality/value The contributions of this study are twofold. First, several assets from different classes were analyzed as possible candidates for safe havens. Second, to the best of the authors’ knowledge, this is the first study to analyze safe haven property through different investment horizons for the US and the European stock market indices during the Russo-Ukrainian War.

Institutional Trading and Managers' Complex Disclosure: Evidence From Conference Calls

ABSTRACTThis study investigates the impact of managerial linguistic disclosures on institutional trading behaviors during earnings conference calls from 2006 to 2016. Utilizing the linguistic Fog decomposition methodology on textual analysis, it analyzes how the linguistic complexity of managerial communication influences institutional ownership changes. Findings indicate that both obfuscation and informativeness of managerial discourse significantly affect institutional trading, with effects varying based on the informativeness of post‐call analyst reports. This impact is more pronounced under conditions of earnings quality uncertainty, suggesting a heightened reliance on managerial cues by institutional investors during such periods. Additionally, the study differentiates responses among investor types: transient investors are more sensitive to linguistic cues, while dedicated and quasi‐indexer investors focus on the informational content of disclosures. These insights enhance understanding of how managerial communication and analyst report informativeness shape institutional trading behaviors through linguistic complexity's influence on institutional ownership.

Heavy Work Investment (HWI) and Its Effect on Employees’ Physical and Mental Health

Abstract Background Economic reality and centrality of work have led to employees investing much time and effort in work. However, The number of hours spent at work may not be the only explanation, and other characteristics, such as type of work, employees’ personality, economic status, motivations, etc., need to be considered. The Heavy Work Investment model (Snir & Harpaz, 2012) considers these variables and classifies employees into four types of investors. This study examines the physical and mental health consequences of each HWI group. Methods Participants (N = 962) were workers who came to a medical center for annual medical screenings. About 70% were males, and the average age was 50.13 years (SD = 9.53). They divided into 5 groups: Typical full-time workers (N = 208, 29.2%), ‘Needy’ (N = 111, 15.6%), ‘Employer directed’ (N = 111, 15.6%), ‘Workaholic’ (N = 192, 26.9%) and ‘Work devoted’ (N = 91, 12.7%). The personal data was cross-referenced with the respondents’ health data. Differences for categorical variables were examined with Chi-square analyses. Results ‘Employer-directed’ employees, more than ‘work-devoted’ employees, perceived their health status as preventing them from performing mild activities. ‘Employer-directed’ and ‘needy’ employees, more than ‘work-devoted’ employees, perceived their health status as interfering with their social activities and their pain as interfering with their regular activities. ‘Workaholic’ employees suffered from more diseases than ‘work-devoted’ employees, and they were found to be 3.70 times more likely to be at a high risk of cardiovascular disease than typical full-time workers. Conclusions It is possible to anticipate types of health damage according to occupation type and develop occupation-adjusted health promotion programs. It is necessary to base labor laws on protecting employees’ health, particularly regarding time and workload’ outside of work’ in both hours (additional or flexible) and location (hybrid work). Key messages • Inspire organizations to be aware of potential injuries caused by HWI and promote the creation of intervention programs, potentially significantly improving employees’ health and well-being. • Evidence for the necessary laws that protect employees’ health, particularly regarding time and workload ‘outside of work’ in both hours (additional or flexible) and location (hybrid work).

Particle swarm optimization with historical return decay enhances cooperation in public goods games with investment risks

In the realm of spatial public goods games, heterogeneous investment has emerged as a potent mechanism to enhance cooperative behavior. Savvy investors dynamically adjust their investment levels to optimize returns based on environmental conditions and personal circumstances. This study delves into the evolution of cooperation within a spatial public goods game framework, characterized by heterogeneous investment and associated risks, conducted on a square lattice. We introduce the investors (I) with heterogeneous investment, who updates his investment amount according to the current environment of the game and his own historical experience. We introduce a particle swarm optimization algorithm with decaying historical returns to fine-tune the investment levels of investors. Furthermore, a risk mechanism inspired by the ultimatum game is integrated into the model. This paper investigates the impact of the risk threshold θ on cooperative behavior and examines the influence of the risk decay factor α on cooperation. Additionally, it analyzes the investment behavior of investors in scenarios where two types of investors coexist. Finally, this study explores the effects of the historical best payoff decay factor β and the self-learning rate c1 on cooperative behavior. This research contributes to a nuanced understanding of heterogeneous investment behaviors in public goods games under specified risk mechanisms, providing novel insights into the intricate dynamics of cooperation in complex systems.

Financing green innovation startups: a systematic literature review on early-stage SME funding

ABSTRACT This paper investigates the critical issue of financing early-stage green startups, examining the types of investors and finance models available, the challenges these startups face, and how the green finance ecosystem can better support early-stage investment. Utilizing a systematic literature review (SLR) methodology, we provide a comprehensive analysis of the current landscape. Our findings reveal a significant paucity of data and a bias towards well-established North American and European ecosystems, while highlighting an emerging diversity in private finance sources post-Global financial crisis (GFC), including grants, equity, and crowdfunding. Despite this, there remains a heavy reliance on public funding and a lack of evidence regarding its impact. The inherent characteristics of cleantech – high capital expenditure, long investment horizons, and disruptive nature – necessitate innovative public financing instruments and policies to reduce risk and attract private investment. Our theoretical contribution highlights the necessity for interdisciplinary research and policy collaboration to develop a holistic entrepreneurial finance (entfin) ecosystem. This approach should integrate quantitative economic and qualitative behavioural finance research to address information asymmetries and improve the green economy policy mix. Such a framework will support public-private co-financing, enhance stakeholder engagement, and provide evidence for policy decisions, facilitating more rapid commercialization of cleantech innovations for environmental sustainability.

The price evolution in financial markets under influence of published opinions

Opinions by media experts and pundits in both traditional media outlets and online venues influence investors. While a published opinion could be more accurate than that of a typical investor, its influence displaces many independent views and has the potential to introduce a shared error. My probabilistic trading model characterizes such influence and demonstrates how the “wisdom of the crowds” effect leads convergence of prices to the fundamental value. I use two corporate events to test the model, and find evidence consistent with the theoretical predictions.

Socially Responsible Finance: How to Optimize Impact

Abstract Can a socially responsible fund (SRF) improve social welfare while maximizing assets under management? We consider a two-sector model integrating financial intermediation, emissions’ negative externalities, and investors’ social preferences with regard to value alignment and impact. In scenarios with a high proportion of value-aligned investors, the SRF invests in clean sectors and compels recipients companies to use low-emission suppliers from the polluting sector, which appeals to both investor types. Alternatively, the SRF adopts a dual-fund approach, with one fund targeting clean sectors for value-aligned investors and another focusing on reducing direct emissions in polluting sectors to attract impact investors. (JEL:G11, G23, M14, O44, Q51)

Probability distortion and non-participation

This paper explores the impact of probability distortion on investors’ participation decisions and market performance. Specifically, we construct a one-period investment model with two types of investors—probabilistic pessimistic and neutral investors. The former assign more weight to bad outcomes and tail events when making decisions. Our findings suggest that non-participation arises from these probabilistic pessimistic investors. In equilibrium, their participation decisions affect the asset premium, which can be decomposed into the risk premium and probabilistic premium.

What drives problematic Bitcoin investment behavior?: The role of financial literacy

PurposeAlongside its remarkable growth, problematic Bitcoin investment (BI) behavior and its associated negative consequences have become prevalent, and only a few studies have examined it. Therefore, this study aims to examine problematic BI behavior by investigating its specific antecedents and consequences and identifying which antecedents were more influential in it. In addition, we also examine the role of financial literacy on the relationship between the antecedents and problematic BI behavior.Design/methodology/approachWe collected survey data from 413 investors with Bitcoin investment experience in 2018, when a Bitcoin frenzy occurred. The partial least squares method was used to test the proposed research model.FindingsThe results show that prudent, negative urgency, overexpectation and sensation seeking are positively associated with problematic BI behavior, while restraint is negatively associated. Problematic BI behavior is negatively related to investor well-being. Our findings also indicate that both objective and subjective financial literacy moderate the relationship between the antecedents and problematic BI behavior. Four types of investors in terms of their objective and subjective Bitcoin knowledge show different patterns in the relationship between the antecedents and problematic BI behavior.Originality/valueThis study offers insights for researchers by providing a deeper understanding of the contextual antecedents of problematic BI behavior and the role of financial literacy in it. This study provides detailed implications for financial institutions, policymakers, and regulators to guide rational Bitcoin investment behaviors.

Frequent Trading and Investment Performance: Evidence From the KOSPI 200 Futures Market

ABSTRACTThis study explores whether frequent trading is profitable to investors in an emerging stock index futures market. Our analyses, based on long‐term data from 2010 to 2023, indicate that the effect of trading frequency differs across investor types and market conditions. Only some domestic institutions gain additional profits from more frequent trading, and such a tendency is apparent when the futures price falls and when the futures market volatility is low. Foreign investors experience losses as they trade more when the market is bearish and are frequently net long. The performance of domestic individuals does not depend on their trading frequency in general; however, they lose more from trading when the market is bearish and when the market is less volatile.

A guide to 130/30 loss harvesting

We analyze the effect of leverage on tax-managed public equity strategies for different types of investors by running back-tests on hypothetical portfolios. We found the average 130/30 long/short portfolio funded with cash generates 2.7 times more capital losses than the average long-only portfolio over the first 10 years. For an investor with a sufficient supply of short- and long-term gains, these additional losses translate to average pre-liquidation tax alpha (“TA”) of 4.41% per year. Liquidation reduces TA by about half, while a lack of short-term capital gains to offset reduces TA by approximately 40%. In combination, those investor characteristics may render a long-only loss harvesting portfolio or a low-cost ETF more desirable than a long/short tax-managed equity portfolio after costs and fees are taken into consideration. Leverage can also be used to revitalize an ossified portfolio whose loss-generating capacity has diminished.

Equal Opportunity for All? The Long Tail of Crowdfunding: Evidence from Kickstarter

Crowdfunding platforms are believed to create a more equal-opportunity environment for fundraising by removing entrance barriers found in traditional entrepreneurial markets. Our work investigates whether in creating more equal opportunities for entrepreneurs to enter the market, crowdfunding platforms also create a more equal distribution of funds across ventures. To this end, we utilized a natural experiment in the form of a policy change on Kickstarter.com that resulted in opening the market to more players. Using platform-level analysis, we show that opening the platform shifted demand toward the head of the distribution: More funds and backers became concentrated in a smaller number of head-offers (the superstar effect). Using individual backer-level analysis, we show that these changes in demand distribution are likely to have resulted from changes in investors’ investment behavior, beyond changes in the composition of the demand side (that is, changes in the types of investors entering the market). Together, our results suggest that efforts to level the playing field in crowdfunding platforms can ultimately result in a less equitable distribution of funds across market participants, and drive investors to focus their investments on a smaller set of campaigns.

환경경영이 경영자보상에 미치는 영향 : 기관투자자 및 개인투자자를 중심으로

[Purpose]This study aims to analyze the impact of ESG management, particularly carbon emission reduction performance, on CEO compensation and to empirically examine the differential impact by investor type. [Methodology]The study analyzed manufacturing firms listed on the Korea Exchange from 2013 to 2022, using financial and environmental data. Multivariate regression analysis was applied to understand the relationship between carbon emission performance and executive compensation, and to assess the differential impact between institutional and individual investors. [Findings]The study found that higher carbon emission performance is associated with higher CEO compensation, with a stronger positive relationship in firms with a higher proportion of institutional investors. [Implications]Incorporating carbon emission reduction performance into CEO compensation can incentivize sustainable management, with institutional investors playing a crucial role in enhancing firms’ ESG performance and improving corporate sustainability.

Institutional Investors and Corporate Social Responsibility (CSR): A Comprehensive Review of Theoretical Frameworks and Empirical Insights

In the evolving discourse of Corporate Social Responsibility (CSR), the role of institutional investors stands out as a pivotal area of exploration. This work delves deep into the intricate interplay between these investors and CSR, emphasizing its significance in the modern corporate landscape. Drawing upon the Institutional, Legitimacy, Agency, and Resource-Based View theories, this paper elucidates how societal norms, alignment with societal expectations, and strategic asset perspectives shape corporate behavior toward CSR. In this work, we highlight the diverse strategies and objectives of institutional investors, such as pension funds and hedge funds, and their profound influence on the CSR landscape. Our findings underscore that these investors not only steer corporations toward sustainable actions but also redefine the very essence of corporate responsibility. The conclusions drawn emphasize the need for synergistic regulations and incentives, aligning with the CSR objectives of these influential stakeholders. Furthermore, the significance of this study lies in its potential to guide future research, especially in understanding the nuanced roles of different investor types and their global implications. In summation, this paper offers a comprehensive insight into the institutional investor-CSR dynamic, spotlighting its profound responsibility and potential in shaping the future of corporate sustainability.

Defaults on government guaranteed loans by potential high growth firms: Evidence from the COVID-19 period

Equity finance is used to fund innovative and growth-oriented businesses because of its resilience during economic downturns and investors' willingness to undertake higher risks compared to other financing. During the pandemic, 6500 equity-funded firms obtained government-guaranteed loans from traditional banks and new lenders. Our analysis of the determinants of loan default revealed that new lenders experienced a significantly higher default rate than the main banking sector. Additionally, firms funded by equity crowdfunding have a higher loan default rate than those backed by other equity providers. We explore the factors influencing defaults and variations by lender and investor type.

Token-Based Crowdfunding: Investor Choice and the Optimal Timing of Initial Coin Offerings

This article examines the operating and financial performance of venture firms conducting initial coin offerings (ICOs) with different types of investors and at different points along a venture’s life-cycle. Relative to purely crowdfunded ICO ventures, institutional investor-backed ICO ventures exhibit weaker operating performance and fail earlier. However, conditional on survival, these ventures financially outperform their peers that do not receive institutional investor support. The diverging effects of investor backing on financial and operating performance are consistent with our theory of “certification exploitation” through a new form of a pump-and-dump scheme. Institutional investors exploit their reputation to drive up ICO valuations and quickly exit the venture post-ICO, with the difference in pre- versus post-certification token prices being their exploitation profit in liquid markets for startups. Our findings further indicate that there is an inverted U-shaped relationship between the financial success of an ICO and the timing along a venture’s life-cycle, with the product piloting phase representing the pivotal point. JEL Codes: G24, G32, K22, L26

Exit routes, investor type, and the Covid-19 crisis: Insights from UK equity-funded companies

Using a sample of UK equity funded companies, we examine differences in the exit strategy of companies funded by distinct investor types and operating in various technology intensive sectors during a period of crisis. Our results corroborate the hypothesis that investor involvement through oversight and imparting expertise augments the likelihood of favourable outcomes. This is particularly evident in high technology sectors. We observe increased exit activity amidst the crisis and notable disparities, contingent upon investor type, concerning chosen exit pathways.

A factor score clustering approach to analyze the biopharmaceutical sector in the Chinese market during COVID-19

The biopharmaceutical sector is of considerable interest during the COVID-19 pandemic. This study aims to investigate the biopharmaceutical sector using the Shenwan Industry Classification and provides insights into investment strategies. We combine factor and cluster analyses to reduce data dimensions and detect their latent similarities. Specifically, the biopharmaceutical sector is divided into six categories based on second-level industry classification. It is observed that medical devices, medical services, biological products, and chemical pharmaceuticals maintained their upward tendency, while Chinese medicine and pharmaceutical commerce declined slightly. We also develop optimal investment strategies using various metrics for different investor types.

An endogenous evolution mechanism model of asset prices based on time-varying risk aversion coefficient

In the traditional heterogeneous agent model, investors are assumed to be risk averse, and the wealth expected utility function maximization principle is used to form the optimal asset quantity demand. In such models, the risk aversion coefficient of investors is often assumed to be constant. This paper considers that the risk aversion coefficient of investors is time-varying and changes with the change of wealth, and establishes an endogenous evolutionary mechanism model formed by fundamental analysts, technical analysts, and market makers. Compared with the fixed risk aversion coefficient model, this paper analyzes the investor’s behavior, the interaction between investor behaviors, and the influence of different types of investors on the stability of the market. At the same time, we test asset price and asset behavior and conclude that investor behavior affects the stability of the system model. The numerical simulation of the corresponding stochastic model shows that the model can simulate the basic characteristics of financial time series, such as the partial peak and thick tail of asset return series, and the long memory of fluctuations.

Corporate Social Responsibility, Ownership Structure, and Firm Investment Efficiency: Evidence from the Saudi Stock Market

This study investigates the relationship between corporate social responsibility (CSR), ownership structure, and investment efficiency in the Saudi stock market. Analyzing data from non-financial companies listed on the Saudi Stock Exchange (Tadawul) from 2016 to 2021, the findings revealed that higher CSR disclosures were positively associated with investment efficiency. Additionally, the study found that firms with higher levels of institutional, family, or foreign ownership demonstrated more efficient investment practices. However, the study did not support the moderation effect of ownership structure on the CSR–investment efficiency nexus. These results remain robust across different alternative measures and methods. This research fills a gap in the literature by examining these relationships in an emerging market with unique governance and ownership structures. Specifically, it extends the understanding of the CSR–investment efficiency nexus beyond developed economies to include the developing context of Saudi Arabia. Furthermore, the study highlights the varying effects of different ownership structures on investment efficiency and provides a detailed analysis of how investor types respond to CSR disclosures, revealing differences from established CSR frameworks in developed markets. The study’s results offer new insights for investors, policymakers, and regulators, and open avenues for further research for academics and business professionals.