Archive | October 2012
You are browsing the site archives by date.
Traditional Macrofinancial framework vs. Robert Merton’s Macrofinancial Framework The traditional approach to measure sovereign credit risk is based upon the assessment of a country’s ability and willingness to service its debt, which takes into account key economic, socio-political, global market, and governance attributes of sovereign entities. Robert C. Merton proposed an alternative approach in this […]
Institutional investors worldwide own approximately $60 billion worth of timberland, of which two thirds ($40 billion) is invested in the U.S., nevertheless, the principal owners of timberland are private, non-industrial landowners, with about $150 billion. Some investors classify timberland investments as private equity, as many of the commercial timberland deals have been made through private […]
Earlier this month, Bloomberg reported that high yield bond funds hauled in $3.63 billion in investor cash for the week ended September 19 with 40%, or $1.45 billon, of those inflows. The global high yield market, with approximately $1.3 trillion in size, as of third quarter 2012, continued to rally in the third week of […]
Investors that follow mean-variance portfolio theory (MVT) by Markowitz (1952) determine optimal aggregate portfolios on the efficient frontier by balancing risk aversion and return preference. In fact, investors have difficulty specifying their respective “optimal” ones at times. In particular, some investors have more than one level of risk aversion, in another word, MVT to some […]
Being one of the few remaining nations with AAA rating and stable outlook, along with ongoing efforts in financial services industry, Singapore’s economic development and competitive tax regime have made the country a park for cash. Historically, Singapore is a highly developed market-based economy, along with Hong Kong, South Korea and Taiwan, Singapore is one […]
Psychology plays a dominant and self-fulfilling role in successful investing and economic growth: if people think things will be positive in the future, they will spend and invest; if they turn pessimistic regarding the future, refusing to spend and go into their shells, growth will slow down. This is what economists call “animal spirits.” The […]