Positive Stock Research Articles

A simulation-based approach for improving stockyard allocation in coal export terminals

The stockyard is a core part of a coal export terminal (CET). Constrained by various influencing factors, studies to deal with the complicated scheduling process of a CET remain insufficiently comprehensive. Until now, for coal stockyards, most stacking scheduling strategies are still manual. The low efficiency of the stockyard has become the main bottleneck that restricts the throughput of a CET. Therefore, this paper proposes a simulation model to capture the whole process of CET operation. A large CET in northern China was selected as a case study to investigate the coal stockyard operation. Four stock position scheduling strategies were analyzed and compared through the simulation technique. Discussion of the simulation results under different strategies can provide a comprehensive basis for stock position scheduling strategy selection by CET managers.

Do changes in deferred revenue indicate future financial performance? Evidence from India

This study investigates whether changes in deferred revenue is a leading indicator of the future financial performance of Indian firms listed on the S&P Bombay Stock Exchange 500 (S&P BSE 500). Multiple regressions with fixed effects were performed using deferred revenue changes (DRCs) and the future financial performance of firms as independent and dependent variables, respectively, along with control variables. Returns from a portfolio comprising a long position in stocks of the 25% of firms with the highest DRCs and a short position in stocks of the 25% of firms with the fewest DRCs were used to ascertain whether DRCs are mispriced in Indian markets. Results show that DRCs indicate the future financial returns of firms. Investors, however, do not fully incorporate into their firm valuation the information content of DRCs, which creates scope for earning positive abnormal returns in the Indian market from a hedging strategy based on the size of DRCs. To the best of our knowledge, this study is the first to establish a relationship between the size of DRCs and the future financial performance of firms in the Indian setting.

Cultural Biases in Equity Analysis

ABSTRACTA more positive cultural trust bias by an equity analyst's country of origin toward a firm's headquarter country is associated with significantly more positive stock recommendations. The cultural bias effect is stronger for eponymous firms whose names mention their home country and varies over time, increasing with negative sentiment. I find evidence of a negative North‐South bias during the European debt crisis and United Kingdom‐Europe divergence amid Brexit. Share price reactions to recommendations by more biased analysts are weaker, and more biased recommendations are worse predictors of monthly stock returns. More positively biased analysts also assign higher target prices.

The market value spillovers of technological acquisitions: Evidence frompatent‐textanalysis

AbstractResearch SummaryThe resource‐based view claims that bundles of resources are the key determinants of a firm's value. Yet, market value spillovers stemming from firms' resource bases have received scarce attention in the literature. This article provides evidence of such spillovers in the context of technological acquisitions. I hypothesize that acquisitions act as signals, revealing to investors that the acquired technologies are more valuable than initially expected. These signals should affect firms owning similar technological resources. Measuring technological similarity with the text similarity of firms' patent portfolios, I find that the announcement of an acquisition brings a positive revaluation of firms with technological resources like those of the target. These spillovers also reach firms with a product market focus different from those of the merging firms.Managerial SummaryTechnological resources are key strategic resources that significantly contribute to firms' valuations. These resources are often acquired through corporate acquisitions. This study explores whether acquisitions affect the valuation of technological resources of other companies not involved in the transaction. The results show that a firm that owns patents similar to the company being acquired experience positive stock market returns at the acquisition announcement, which suggests that the deal signals to investors that the acquired resources are more valuable than initially expected. This effect holds regardless of whether the firm belongs to the same industry as the target or the acquirer. These spillovers change the market value of technological resources and are likely to affect the gains from later acquisitions or divestures of similar resources.

Trends of industry-leading biotechnology stocks during COVID-19

The 2019-nCoV coronavirus has significantly impacted the macroeconomic outlook for countries across the world. The biotechnology sector experienced a relatively positive stock price outlook, which corroborates the trends exhibited by biotechnology stocks in previous pandemics such as SARS (2003) and AH1N1 (2009). During the COVID-19 pandemic, vaccine roll-out rates have been more efficient than in any other pandemic, as companies today are more experienced in combating the time constraint to create vaccines. Gilead Sciences Inc. saw its shares rise 18% after developing the first FDA-approved COVID-19 vaccine, 'remdesivir'. In contrast, AstraZeneca's shares fell 2.28% in 2021 after its vaccine underwent investigations into blood-clotting side effects and subsequent suspension from several countries. Companies developing mRNA vaccines like Moderna, BioNTech, and Pfizer witnessed surges in share prices ranging from 10% to 20%. Many newer biotech companies such as Genexie, Sanovi, OnoSec, and Vaxart have also developed vaccines for COVID-19. Share prices are more volatile for these less established companies. This paper observes how developing new technologies, staging clinical trials, obtaining FDA approvals, gaining publicity, and several other complex factors have profound impacts on the stock prices of these biotechnology companies.

Stock Returns During Religious Holidays: The Role of Culture and Belief

This research investigates the effects of culture and belief on stock returns in Asia and Europe during religious holidays. Culture was proxied by power distance, individualism, uncertainty avoidance, and long-term orientation. Belief was proxied by government regulation, government favoritism, and social regulation. Seventeen stock indices were selected, and the data employed in this research are stock returns during religious holidays commemorated by each country listed in the top world indices from 2016 to 2020. A quantitative method was employed and the data analysis was done using a multiple linear regression method with panel data. This research shows that individualism, government regulation, favoritism, and social regulation positively affect stock returns during religious holidays. This implies that investors recognize stock market characteristics to facilitate investment decision-making. It is recommended that investors maximize positive stock returns found in individualistic countries and countries with high government regulation, favoritism, and social regulation.

Evaluation of the feasibility of acetabular cup pre-determination in revision total hip arthroplasty via X-ray of the bone stock of the anterosuperior acetabulum

PurposeThis study was aimed to explore (1) location on AP pelvic X-ray that displayed bone stock in anterosuperior acetabulum; (2) whether X-ray could provide enough evidence to evaluate whether bone stock could provide support for acetabular cup; (3) criteria to determine whether anterosuperior bone stock could provide sufficient support for cup on X-ray.MethodsOur study retrospectively collected 43 patients who underwent revision THA for cup loosening from 2014 to 2019. The position of anterosuperior acetabular bone stock was compared between X-ray and CT-based 3-D reconstruction. Seventy-millimeter acetabular cup was implanted simulatively to obtain the contact line between acetabular cup and superolateral remaining bone stock. The contact line length and the angle were measured. Patients were divided into cup group and cage group, and ROC curves of both contact line length and angle were drawn.ResultsThe superolateral part of acetabulum on X-ray could reflect the anterosuperior host bone stock of acetabulum according to the comparison of anteroposterior pelvic X-ray and 3-D reconstruction. Critical point was chosen when we got the highest sensitivity with a 100% specificity in ROC curves. The critical values of contact length and angle were 15.58 mm and 25.5°.ConclusionsSurgeons could assess the anterosuperior bone stock of acetabulum by AP pelvic X-ray to decide whether revision could be done merely using cup or need customized cage. Clinically, when contact line length was larger than 16 mm or contact angle was larger than 25.5°, adoption of cup could obtain primary stability in the revision surgery in most cases.

Private information in trades, R2, and large stock price movements

We investigate the relations between trading-conveyed private information and stock return distributions. Using high-frequency measures of private information, we find that private information in trades is associated with lower stock return synchronicity. We also find private information in trades is positively associated with stock price crashes and positive stock price jumps. Our results are robust to several specification checks, including the use of alternative private information proxies, various model specifications, and different time periods. Overall, we demonstrate that trading conveyed private information reduces stock return synchronicity and predicts the frequency of crashes and jumps. Our findings can be useful for market makers, regulators, and traders, who are interested in firm-specific return variation and extreme stock price movements at high frequencies.

A Fortune from misfortune: Evidence from hog firms’ stock price responses to China’s African Swine Fever outbreaks

China is the world’s largest hog producer and a leading pork importer. Since August 2018, ongoing outbreaks of African Swine Fever (ASF), a highly contagious and deadly disease affecting pigs, have hit China’s livestock industries and wiped out 40% of China’s pigs. We leverage data on daily stock returns from 25 major publicly listed firms from China and eight major pork-exporting countries to provide the first systematic analysis of the firm-level economic impacts of the outbreaks. We find that, on average, announcements of ASF outbreaks have led to positive and significant stock returns for both Chinese and international hog firms. China’s hog firms, on average, enjoyed 10%–40% cumulative abnormal returns during the 2019 Chinese Spring Festival, when investors saw signs of a near-20% inventory loss during a peak demand season for pork. We show that larger hog firms tend to capture greater positive stock returns. Our results suggest opportunities for consolidation, expansion, and upgrades of China’s meat industry that have long-run implications for its global competitiveness and efficiency.

The single and joint effects of financial intervention policies introduced by governments and power distance culture on returns of equity markets during the COVID-19

PurposeThis paper uniquely aims to triangulate the effects of the COVID-19 pandemic, government financial intervention (GFI) policies and power distance (PD) culture on returns of equity indices during the COVID-19 epidemic in the world's equity markets.Design/methodology/approachThe research employs panel data regression analysis using 1,937 observations from 19 developed and 42 developing countries. The data employed contain daily registered COVID-19 cases, global equity market index prices, financial intervention policies introduced by governments and Hofstede's cultural dimension measure of PD.FindingsThe authors find that investors certainly react negatively to the number of confirmed COVID-19 cases reported, that GFI policies indeed reinforce investors' expectations of policymakers' dedication to stabilize the economy during the COVID-19 pandemic and that equity investors in high PD cultures overreact to GFI news, resulting in more positive stock returns. The authors discover a difference between developed and developing countries in terms of the effect of GFI policies and PD on equity returns.Research limitations/implicationsResults suggest that investors react negatively to the daily registered COVID-19 cases. The authors find that financial intervention policies introduced by governments reinforce investors' outlooks of policymakers' commitment to stabilize local stock markets during the coronavirus pandemic. The results confirm that equity market investors in PD cultures overreact to financial intervention news, thus resulting in more positive stock returns.Practical implicationsThe paper provides three original contributions. First, it helps us to understand the single effect of the COVID-19 and financial intervention policies introduced by governments on returns of the global equity market. Second, it examines the possibility of a two-way joint effect between the COVID-19 and financial intervention policies introduced by governments and the COVID-19 and differences in countries characterized by a PD culture concerning stock market returns. Third, it investigates the possibility of a three-way interaction effect between the COVID-19 contagion, financial intervention policies introduced by governments and culture on returns of equity markets.Originality/valueThe authors' findings are valuable to researchers, investors and policymakers. Culture and finance scholars can now observe the role of Brown et al.'s (1988) uncertain-information hypothesis with reference to the effect of the COVID-19 and financial interventions policies introduced by governments on returns of equity markets. This is because the authors' findings underline that since investors' uncertainty declines with daily registered numbers of COVID-19 cases, the introduction of GFI policies function as a neutralizing device to re-establish investors' expectations to equilibrium. Consequently, stock market returns follow a random walk that is free from the negative effect of the COVID-19. The authors' work is likely to advise equity investors and portfolio managers about the extent to which major exogenous economic events such the outbreak of global diseases, financial interventions policies introduced by governments and differences in countries' PD culture can individually and jointly influence the return of the world's equity markets. Investors and portfolio managers can employ the authors' results as a guideline to adjust their investment strategy based on their investment decision strategy during global pandemics. Policymakers aiming to introduce financial intervention policies to stabilize their stock market returns during global pandemics can benefit from our results. They can observe the full effect of such policies during the current COVID-19, and subsequently be better prepared to choose the most effective form of financial intervention policies when the next pandemic strikes, hopefully never.

Using logbook‐based catch‐rate data to detect yellow eel population trends in the southern Baltic Sea

AbstractWithin recent years, a slight but significant increase of European eel Anguilla anguilla (L.) recruitment has been documented, but it remains questionable whether or not the increased recruitment levels resulted in higher eel numbers at the regional scale. To detect the changes in yellow eel numbers, logbook data covering a 15‐year time series of catch per unit effort (CPUE) data from the German Baltic Sea were analysed. Monthly mean catch rates were calculated for two different size classes for two passive gears: fyke and stationary trap nets. Change‐point analysis was applied to discover changes in the catch data. After a period of decreasing or constant catch rates, the fyke net data indicated that yellow eel numbers increased slightly in recent years in the Baltic Sea. Besides increasing numbers of immigrating juvenile eels, other population dynamics or conservation efforts might have added to the observed positive stock trend.

Effect of intelligent logistics policy briefings on shareholder value: evidence from Chinese logistics companies

ABSTRACT This paper investigates the effects of intelligent logistics policies briefings (ILPBs), which are a kind of special press conference, on the shareholder value of the 149 listed logistics companies in China. For macro factors, we find that ILPBs will result in a positive stock market reaction, and the mean abnormal return on the event day is 0.728%. For micro factors, an ILPB has a more positive impact on the market value of larger enterprises. The business types do not affect the degree of market reaction. For the characteristics of policy briefings, the market reaction will be more positive as the proportion of the intelligent logistics content in the conference increases. Policy briefings with two different topics will result in more positive stock market reactions than those with one. Finally, we compare the market reactions of ILPBs with those of official policies.

Impact of Technical Parameters for Short- and Long-term Analysis of Stock Behavior

Stock price forecasting is a type of time series problem that forecasts the future price or status of a company on the basis of analysis of time respective values. As the price of stock or company varies with respect to time, its behavior can be analyzed by different machine learning approaches. In this work, methodology is proposed to evaluate the stock position with variation in time using deep learning approach such as recurrent neural network (RNN). This methodology used the technical parameters to evaluate the long term and short-term analysis of any stock or share. This approach also evaluates and gives suggestions to investors either to buy or sell any stock for long term and gives return at very low risk. In this paper work, hybridization of co-relation analysis and deep learning approach for stock price and long-term behavior analysis. The proposed work is termed as time lagged weight optimized RNN (TL-WO-RNN) that is adopted in this work and effectively predict the technical parameters and on the basis of that stock behavior is also predicted. The result analysis was performed on data from different sectors and such as Telecom, Powers, Manufacturing, Finance, Software sectors, etc. The result analysis shows the effectiveness of the TL-WO-RNN algorithm as compared to existing work.

Firm-Specific Industries, Volatility, and Return: A Text-Based Network Industrial Classification Approach

This study finds that the firm-specific industry of the text-based network industrial classification (TNIC) is a key driver of return volatility and abnormal return. Rationally, firm-specific industries provide a unique set of competitors that share more fundamentals than those from fixed industrial classifications. The TNIC return volatility is positively associated with higher firm volatility. It also explains the abnormal returns not captured by the six-factor asset-pricing model of Fama and French. Finally, this study explores asset-pricing implications by examining a long position in stocks with high TNIC volatility and a short position in stocks with low TNIC volatility. This long–short investment strategy delivered significant and positive non-factor-related returns that are higher than the same investment strategy applied to fixed industrial classifications such as Standard Industrial Classification and Fama and French classification. <b>TOPICS:</b>Security analysis and valuation, factor-based models, quantitative methods, statistical methods, performance measurement <b>Key Findings</b> ▪ Industry return volatility based on the TNIC is an underlying factor in explaining a firm’s volatility and return. ▪ Sorting firms into investment portfolios based on TNIC industry volatility provides significant abnormal return not explained by the traditional industrial classifications. ▪ Industry grouping methods (i.e., TNIC) may enhance the performance of asset-pricing models.

Who owns tobacco stocks?

We compare the ownership characteristics of tobacco stocks with their peers in the same country and industry group. We find lower reported ownership for stocks in the tobacco industry, which suggests that anonymous investors are larger owners of these sin stocks. Compared to peer stocks, U.S. and U.K. asset managers collectively overweight tobacco stocks, while norm-constrained investors such as sovereign wealth funds and pension funds underweight tobacco stocks. Passive managers have large stakes in tobacco stocks that are in line with the weights of these stocks in broad capitalization-weighted indices, indicating that passive replication of ethically screened indices is still a niche. We also identify some prominent active investors who take large positions in tobacco stocks.

Self-Management Portfolio System with Adaptive Association Mining: A Practical Application on Taiwan Stock Market

A well-established financial trading system should well perform in resource allocation, risk management, and sustainability. In this paper, we propose a self-management portfolio system with adaptive association mining for practical applications. The system allocates funds into independent units for risk management, and utilizes association mining and adaptive closing mechanism for resource allocation and sustainability, and adopts a self-management module for monitoring positions. The proposed system boosts the annual return and Sharpe ratio to 9.1% and 0.578 (increased to 2.28 and 2.48 times), and reduces the drawdown risk to 34.6% (decreased to almost half). Furthermore, the system rapidly closes the stock positions to avoid drawdown risk in the bear markets, and gradually increases the stock positions when the market turns into bull. Compared with benchmarks, proposed system outperforms all benchmarks in all measurements and on randomly sampled dataset.

A MAP/PH(1), PH(2)/2 Production Inventory System with Multiple Servers and Varying Service Rates

The paper comprises an (s,S) production inventory facility in which multiple vacations and varying service rates are considered for the multiple servers. The arrival of customers constitutes a Markovian Arrival Process (MAP) and service completion times follow the phase type distributions with representations ( α, S ) and ( β, T ) respectively. Manufacturing needs to begin at the moment when the stock position falls to s. Service is offered at a lower rate if the stock level ranges from 0 to s and the service time distribution has the representations (α, η 1 S) and (β, η 2 T ), 0 < η 1, η 2 < 1 respectively. If the stock level reaches the maximum S, production is ceased to operate. 1-limited service policy, Bernoulli service schedule, and Exhaustive service disciplines are considered for the servers. A suitable cost function is outlined as per performance assessment. The impact of negative correlated inter arrival times on cost function is illustrated. Also, a relative study of expected cost function on different service modes is presented.

The Effect of Shari’ah Compliance Announcements on Stock Returns in Malaysia

There are increasing demands and interests in Shari’ah compliant stocks in Malaysia. The identification of Shari’ah compliant stocks is known as Shari’ah screening, which is announced to the public twice a year. Hence, the objective of this study is to investigate whether the announcements provide valuable information and the impact of such announcements on stock returns. This study applies market model to estimate the stock returns. Alternative hypotheses that are being tested are the inclusion (removal) of stocks in (from) the Shari’ah Compliant List give a significant effect on the stock Cumulative Average Abnormal Return (CAAR). Employing the event study methodology in years 2007 –2015, this study provides unambiguous evidence that the inclusion of a stock in the Shari’ah Compliant List has increased the price that lead positive stocks returns 1 day within the announcement date. Meanwhile, the removal from the list results a negative stock returns due to the declined of the stock price. As such, the announcements of Shari’ah Compliant List do carry informational value and have significant effect on the stock returns in Malaysian capital market. Shari’ah compliance announcement is significant especially to the Muslim investors to assist them avoiding prohibited investment activities. The present study has significantly contributed to the Malaysian Efficient Market Hypothesis as well as to the practical implication for the companies in avoiding with haram activities.

Stock Return Extrapolation, Option Prices, and Variance Risk Premium

Abstract This paper presents a tractable dynamic equilibrium model of stock return extrapolation in the presence of stochastic volatility. In the model, consistent with survey evidence, investors expect future returns to be higher (lower) but also less (more) volatile following positive (negative) stock returns. The biased volatility expectation introduces a new channel through which past returns and investor sentiment affect derivative prices. In particular, through this novel channel, the model reconciles the otherwise puzzling evidence of past returns affecting option prices and the evidence of variance risk premium predicting future stock market returns even after controlling for the realized variance.

Optimizing inventory management costs in supply chains by determining safety stock placement

For a production business, the measurement of safety inventory to be maintained during each step of a supply chain is a key concern and requires providing the clients an irregular state of management. The stock held should be small to reduce holding costs and capacity while maintaining the capacity to service customers in time to satisfy much, if not all, the demand. This paper discusses this issue by using a deterministic time structure and provides a measure of the security position of stock in supply chains for the overall network. First, prove that the overall problem is NP-hard. Then set up a couple of parameters that characterize an optimal overall network structure. To take care of these problems, a polynomial approximation is considered. An arrangement of computational tests to survey the execution of the general-network calculation and to decide how to set different parameters for the calculation is selected. In addition to the general network case, the two-layer network issues are considered. Also, a nonlinear model for determining the level of safety stock in different components of the supply chain to minimize the related safety stock costs is developed.