Journal of Applied Finance

Journal of Applied Finance is a trade journal focusing on Applied Finance

Articles from Vol. 17, No. 1, Spring

A Multinational Survey of Corporate Financial Policies
Questionnaire-based studies of corporate finance deal primarily with the American or the European market, and treat only a few aspects of corporate financial decisions. This study covers five countries - the US, the UK, Germany, Canada, and Japan, and...
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Correction for Marketability Risk Applied to Municipal Bond Yields
There is a problem with the conventional expression for the tax rate at which investors are indifferent between a tax-exempt municipal bond and a taxable corporate bond. It suggests an implausibly low rate. Application of an adjustment for the illiquidity...
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Delaware Incorporation and Earnings Management: An Empirical Analysis
Motivated by agency theory, this study examines whether the extent of earnings management significantly differs in firms incorporated in Delaware versus those incorporated elsewhere in the U.S. Delaware corporate law has been argued to affect agency...
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Duration Crossovers: An Anomaly Explained
We challenge the common belief that longer-maturity, lower-coupon bonds always have greater duration than shorter-maturity, higher-coupon bonds. Duration crossovers can occur when bonds have different coupon cycles; the explanation is non-synchronous...
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Financial Puzzles
With the previous issues of JAF, we began publishing Financial Puzzles by Stewart C. Myers. This set (Problems 8-10) is the third installment. The solutions for the previous set are also given below, as well as available at FMA on-line.- The Editors8....
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M&As: The Good, the Bad, and the Ugly
M&As should be defined to include joint ventures, alliances and divestitures in addition to mergers and acquisitions. M&As represent a neoclassical theory of how firms seek to enhance their capabilities and resources (the Good). Good M&As...
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Serial Correlation of Analyst Forecast Errors in 12 Asia-Pacific Markets
This examination of the serial correlation in analyst forecast errors in Asia-Pacific markets analyzes the impact of lagged forecast errors on contemporaneous forecast errors, controlling for firm- and time-specific components of forecast errors. The...
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Target Firms and In-House Mergers and Acquisitions
We propose that target firms are more likely to use an investment bank advisor when the value of the bid is not clear, when they hope to have alternate or more bids, or when they do not understand their own value. Using two representative samples of...
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The Asymmetric Impact of Volatility Risk on Hedge Fund Returns
I investigate the asymmetric impact of volatility risk on returns of hedge fund strategies. I compare volatility risk exposures to price risk exposures by considering the causation between implied volatility and market returns. I also investigate whether...
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When to Delay a Capital Purchase If Obsolescence Is Possible
There is a popular perception that it can be desirable to delay purchases when quality is rapidly improving or prices are declining. I develop the conditions under which it makes sense to postpone the purchase of a seemingly positive net present value...
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