Int. J. Financial Stud.2014, 2(2), 179-192; doi:10.3390/ijfs2020179 - published online 16 April 2014 Show/Hide Abstract
Abstract: Clock rule changes were introduced in the 2006 season with the goal of reducing the average duration of the game; these changes were reversed in 2007. In addition, in 2007 the kickoff rule was changed to create more excitement and potentially more scoring. We examine what happened to actual and expected scoring during these National Collegiate Athletic Association (NCAA) football seasons. The clock rule change in 2006 led to lower scoring which was not fully encompassed in the betting market, leading to significant returns to betting the under. Multiple rule changes in 2007 led to volatility in the betting market that subsided by season’s end.
Int. J. Financial Stud.2014, 2(1), 168-178; doi:10.3390/ijfs2010168 - published online 18 March 2014 Show/Hide Abstract
Abstract: The National Football League (NFL) has recently received significant negative media attention surrounding the safety of its players, revolving largely around the long term health risks of playing the sport. Recent premature deaths and instances of suicide associated with chronic traumatic encephalopathy and other football related injuries have brought the sport under increased scrutiny. By comparing mortality rates of the general population to mortality rates of players using publically available data from the 1970 and 1994 NFL seasons, we test whether participation in football is significantly harmful to the longevity of the players. We conclude that, in total, players in the NFL have lower mortality rates than the general population. However, there is evidence that line players have higher mortality rates than other players and that those who played more games have higher mortality rates than those who played fewer games.
Int. J. Financial Stud.2014, 2(1), 145-167; doi:10.3390/ijfs2010145 - published online 17 March 2014 Show/Hide Abstract
Abstract: This paper addresses the relationship between stock markets and credit default swaps (CDS) markets. In particular, I aim to gauge if the co-movement between stock prices and sovereign CDS spreads increases with the deterioration of the credit quality of sovereign debt. The analysis of correlations, Granger causality, cointegration, and the results of an error-correction model represented in a state space form show a close link between these markets, but do not evidence that the co-movement increases in periods of financial distress. I also analyze the transmission of volatility between the two markets. The results do not support the hypothesis that volatility propagation surges during financial distress periods. On the contrary, for some cases, the data suggests that the lead-lag relationships between the two markets volatility are stronger during stable periods.
Int. J. Financial Stud.2014, 2(1), 122-143; doi:10.3390/ijfs2010122 - published online 3 March 2014 Show/Hide Abstract
Abstract: Credit risk measurement remains a critical field of top priority in banking finance, directly implicated in the recent global financial crisis. This paper examines the dynamic linkages between credit risk migration due to rating shifts and prevailing macroeconomic conditions, reflected in alternative business cycle states. An innovative empirical methodology applies to bank internal rating data, under different economic scenarios and investigates the implications of credit risk quality shifts for risk rating transition matrices. The empirical findings are useful and critical for banks to align to Basel guidelines in relation to core capital requirements and risk-weighted assets in the underlying loan portfolio.
Int. J. Financial Stud.2014, 2(1), 103-121; doi:10.3390/ijfs2010103 - published online 28 February 2014 Show/Hide Abstract
Abstract: In this paper we investigate the relationship between family ownership structure and corporate value across a sample of 1314 firm-year observations of China’s family publicly listed companies (PLCs), from 2004 to 2008. We find a significant inverse-U-shaped relationship between the controlling family’s ultimate cash-flow rights and corporate value; as measured by Tobin’s Q. That is, as family-ownership concentration increases, corporate value first increases and then decreases. This finding refreshes our understanding of the relationship between family-ownership concentration and corporate value in emerging economies such as found in China. We corroborate prior findings that when controlling families hold excess control over cash-flow rights, corporate value is significantly lowered, while multiple large shareholders structure is significantly associated with higher corporate value. In addition; board independence is found to significantly improve corporate value in the context of family-concentrated ownership. We also test for potential endogeneity between family ownership and corporate value and find our results to be robust.