Financial Services
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- 08 Aug 2018
- Sharpening Your Skills
Parmigiano-Reggiano, Jane Austen, and Other Things You Didn't Know About Finance
Why did Italian bank Credito Emiliano accept young Parmigiano-Reggiano as loan collateral? What can Jane Austen and Mel Brooks teach us about finance fundamentals? What's up with millennials and their Chase Sapphire Reserve cards? Our recent stories explain all. Open for comment; Comment(s) posted.
- 26 Jun 2018
- Working Paper Summaries
The Impact of Pensions and Insurance on Global Yield Curves
The global financial crisis and its aftermath had a dramatic impact on the solvency of pension funds and insurance companies. Drawing on a large cross-section of countries, this paper shows the importance of pension and insurance companies in determining the yields on long maturity bonds around the world.
- 20 Jun 2018
- Working Paper Summaries
Show or Tell? Improving Agent Decision Making in a Tanzanian Mobile Money Field Experiment
Mobile money is popular in developing economies but many agents do not maintain proper inventory levels. This paper, based on a study of 4,771 agents in Tanzania, shows how training and ongoing guidance improve their inventory management. Agents who get in-person training and explicit inventory recommendations tend to stock out less.
- 14 Jun 2018
- Cold Call Podcast
How Chase Sapphire Made Credit Cool for Millennials
The Chase Sapphire Reserve card was one of the hottest product launches in 2016. But what would be its next act, now that the introductory offer of 100,000 points was reduced? Shelle Santana discusses JP Morgan's strategy. Open for comment; Comment(s) posted.
- 26 Apr 2018
- Cold Call Podcast
Why JPMorgan Chase Is Investing Millions in Detroit
JPMorgan Chase is making extensive investments into the revitalization of Detroit. What does it expect in return? Professor Joseph Bower and JP Morgan executive Peter Scher discuss the challenges and rewards of partnering with cities in this podcast. Open for comment; Comment(s) posted.
- 02 Apr 2018
- Research & Ideas
Is 'Gut Feel' a Good Reason to Invest in a Startup?
Most investments in startups should never be made, at least when using by-the-numbers reasoning. But funded they are. Laura Huang believes investors use gut instinct to manage that risk. Open for comment; Comment(s) posted.
- 31 Mar 2018
- Working Paper Summaries
Expected Stock Returns Worldwide: A Log-Linear Present-Value Approach
Over the last 20 years, shortcomings of classical asset-pricing models have motivated research in developing alternative methods for measuring ex ante expected stock returns. This study evaluates the main paradigms for deriving firm-level expected return proxies (ERPs) and proposes a new framework for estimating them.
- 29 Mar 2018
- Working Paper Summaries
Government Incentives and Financial Intermediaries: The Case of Chinese Sell-Side Analysts
This study is the first to examine analysts’ incentives vis-à -vis the government in a context where government has the ability and motives to influence capital market institutions. The paper highlights the role of government incentives in analysts’ behavior and output.
- 28 Mar 2018
- Research & Ideas
Sophisticated Investors May Be Harming Fintech Lending Platforms
A study by Boris Vallee and Yao Zeng says savvy investors on peer-to-peer lending platforms are upsetting a delicate balance that makes those systems work for borrowers. Open for comment; Comment(s) posted.
- 20 Feb 2018
- Working Paper Summaries
Stock Market Returns and Consumption
Using a unique dataset for the entire Swedish population, this study of household consumption in response to changes in capital gains and dividends shows that the marginal propensity to consume (MPC) out of capital gains for households in the top 50 percent of financial wealth distribution is relatively uniform and around 5 percent but is more than 10 percent for the bottom 50 percent. These results explain why the recent stock market rally ignited a spending splurge that is cutting into how much households save for rainy days.
- 15 Feb 2018
- Cold Call Podcast
Black Business Leaders Series: John Rogers and the Importance of Hiring Minority-Owned Services Firms
Steven Rogers discusses a new Harvard Business School case study about the risks of speaking up, and the importance of black empowerment in the investment sector in this podcast. Open for comment; Comment(s) posted.
- 15 Feb 2018
- Working Paper Summaries
Can Financial Innovation Solve Household Reluctance to Take Risk?
Structured products are an innovative class of retail financial products with option-like features. This paper provides empirical evidence suggesting that innovative financial products like these can help alleviate loss aversion and thus the low participation of households in risky asset markets.
- 05 Feb 2018
- What Do You Think?
Should Companies Disclose Employee Compensation?
SUMMING UP Do you want your salary broadcast on the company website? James Heskett's readers debate the value of corporate transparency on compensation. Open for comment; Comment(s) posted.
- 11 Jan 2018
- Working Paper Summaries
Brokers and Order Flow Leakage: Evidence from Fire Sales
This study finds that brokers tend to reveal the occurrence of a fire sale to their best clients, allowing them to generate significant profits by predating on the liquidating fund. Such information leakage comes at the expense of higher price impact, and leads to a more costly liquidation for the fire sale originator.
- 10 Jan 2018
- Research & Ideas
Working for a Shamed Company Can Hurt Your Future Compensation
People who work for a company guilty of malfeasance may see their future compensation curtailed, even if they are guilty of nothing, according to research by Boris Groysberg, Eric Lin, and George Serafeim. Open for comment; Comment(s) posted.
- 08 Jan 2018
- Research & Ideas
The Startling Percentage of Financial Advisors with Misconduct Records
One in twelve financial advisors have been disciplined for serious misconduct, according to a recent study by finance professor Mark Egan and colleagues. The bad apples are rarely punished. Open for comment; Comment(s) posted.
- 31 Oct 2017
- Working Paper Summaries
Mutual Funds as Venture Capitalists? Evidence from Unicorns
Larger mutual funds and those having more stable funding are more likely to invest in privately held startups known as unicorns. Mutual funds are less involved in corporate governance, especially boards of directors, but have more protections when it comes to liquidating their stakes.
- 02 Oct 2017
- What Do You Think?
Do Bitcoin and Digital Currency Have a Future?
SUMMING UP Bitcoin has shown to be a powerful digital currency, but the real story of the future is Blockchain, say James Heskett's readers. Open for comment; Comment(s) posted.
- 21 Sep 2017
- Cold Call Podcast
State Street’s SHE: Investing in Women Leaders
As investors increasingly demand investment opportunities that match their social beliefs, financial services firms are busy designing new products. In this podcast, Vikram Gandhi discusses the expanding influence of impact investing and how State Street Global Advisers is responding. Open for comment; Comment(s) posted.
Two Million Fake Accounts: Sales Misconduct at Wells Fargo
Coming out of the financial crisis, Wells Fargo was one of the world’s most successful banks. But then its sales culture went wild, opening more than 2 million fake accounts. Suraj Srinivasan discusses what went wrong. Open for comment; Comment(s) posted.