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Using breadth of corporate bond fund ownership to proxy for the combination of short-sale constraints and divergence of opinions in the corporate bond market, this paper investigates whether and to what extent Miller's overpricing theory holds for corporate bonds. Consistent with the theory, we document a significant and positive relation between changes in breadth and the cross-section of future corporate bond returns. Because of the bounded upside of debt, the ability of changes in breadth to predict returns appears to be less pronounced for corporate bonds relative to stocks. Furthermore, this predictability is stronger among bonds with higher credit risk, indicating that the effect of short-sale constraints and divergence of opinions on bond mispricing tends to be larger for riskier bonds with more upside potential and, thus, more scope for overvaluation. This paper was accepted by Lukas Schmid, finance. Supplemental Material: The internet appendix and data are available at https://doi.org/10.1287/mnsc.2023.4950. [ABSTRACT FROM AUTHOR]

Banks are the engine of providing financial resources in the economy and have special importance for governments. Accordingly, presenting the factors and components affecting financing restrictions and changes in the corporate debt bonds yield, risk management, as well as changes in their stock prices, in terms of bank management and from a macroeconomic perspective, can be considered as the leader of the economy and government. On the other hand, the proper management of banking challenges and the improvement of factors affecting the efficiency and effectiveness of banking resources can move the economic cycle in the right direction, considering that the banks’ primary activity is to grant loans and provide them to applicants. Accordingly, the researcher addressed the effect of the ability to manage political relations and financial crises on performance improvement. Therefore, a combination of Data Envelopment Analysis (DEA) and Two-Stage least squares (2SLS) regression analysis was used. This study is descriptive research with the correlational and post-event approach. In this way, the information about 11 banks in a period of 9 years (2014- 2023) was analyzed. The results showed that the improvement of ability level and proficiency in bank management will lead to the improvement of financing constraints, changes in corporate bond yield, and the growth rate of stock and non-shared incomes. The management authority not only affects credit risks, credit risk management and liquidity risk but also does not affect the stock price drop. [ABSTRACT FROM AUTHOR]

Featured Application: This research has important applications in areas such as smart furniture and human-computer interaction. It will bring people a more efficient and comfortable living experience as well as a new smart experience.  Human action recognition has many application prospects in human-computer interactions, innovative furniture, healthcare, and other fields. The traditional human motion recognition methods have limitations in privacy protection, complex environments, and multi-person scenarios. Millimeter-wave radar has attracted attention due to its ultra-high resolution and all-weather operation. Many existing studies have discussed the application of millimeter-wave radar in single-person scenarios, but only some have addressed the problem of action recognition in multi-person scenarios. This paper uses a commercial millimeter-wave radar device for human action recognition in multi-person scenarios. In order to solve the problems of severe interference and complex target segmentation in multiplayer scenarios, we propose a filtering method based on millimeter-wave inter-frame differences to filter the collected human point cloud data. We then use the DBSCAN algorithm and the Hungarian algorithm to segment the target, and finally input the data into a neural network for classification. The classification accuracy of the system proposed in this paper reaches 92.2% in multi-person scenarios through experimental tests with the five actions we set. [ABSTRACT FROM AUTHOR]

Bakong (Hanguana malayana (Jack) Merr.) is a perennial herbaceous plant that grows abundantly in certain parts of the Philippines. This study investigates Bakong fibers' potential as a pulp source for papermaking. Furthermore, microfibrillated cellulose (MFC) produced from the fibers was used as an additive in the Bakong fiber-based hand sheets at 2%, 6%, and 10% w/w, and their effects on their strength properties were observed. The soda pulping method produced Bakong pulp with a total yield of 47.36%. Proximate chemical analysis showed that the method reduced the lignin content from 13.19% to 8.76%, and the resulting pulp was successfully formed into paper hand sheets. The strength properties of the hand sheets were tested, and the resulting burst index, tear index, tensile index, and folding endurance values were 5.98 kPa/m2·g, 6.41 mN·m2/g, 105.97 N·m/g, and 626 double folds, respectively. Aside from the tear index, the Bakong hand sheets' strength properties were much higher than that of locally produced commercial printing paper. The addition of MFC on the hand sheets negatively affected the burst and tensile index values of the Bakong hand sheets but significantly improved the tear index up to 6% w/w. These results show that the pulp produced from the Bakong fibers can potentially be used as an alternative source of pulp for papermaking, but further optimization of the pulping process is recommended to increase the yield, lower lignin content, and improve compatibility with the MFC. [ABSTRACT FROM AUTHOR]

Reaching for yield, which we define as an investor preference for higher-yield bonds at a given rating or for higher-rated bonds at given yields, is associated with inflated valuation and thus negatively predicts risk-adjusted returns. Controlling for ratings, alphas are lower for higher-yield bonds, whereas, controlling for yields, alphas are lower for safer-looking, higher-rated bonds. Future bond returns are particularly low when current interest rates are low and demand from yield-reaching investors increases. These bonds experience more frequent downgrades and defaults, suggesting that they are riskier despite their high valuation. This paper was accepted by Victoria Ivashina, finance. Supplemental Material: The e-companion and data are available at https://doi.org/10.1287/mnsc.2023.4920. [ABSTRACT FROM AUTHOR]

The questions on long-term planning of an enterprise’ bonded loan interest rate payments have been studied. The methods have been considered and the classification of methods for planning the bonds interest rate proposed. Several groups of such planning methods have been singled out. The analysis of application of bond interest rate planning methods applied by enterprises of different national industries has been made. The analysis has been carried out in the spheres of mechanical engineering, generation, transmission and sales of electric power, ferrous metals production, transportation and logistics, foodstuffs production, and information transmission provision. Corporate bond issues issued between 2015 and 2020 have been analyzed. As a result, the three methods most frequently used by enterprises in planning bond interest rates have been identified: methods of considering the macroeconomic risk of an organization; methods of considering the combination of macroeconomic and individual risk of an organization; methods based on market analysis. The study of the mentioned methods allowed us to propose a method of planning the bond interest rate, which calculates the weighted average of the forecast bond interest rate. To assess the quality of the proposed method, it has been tested. The article concludes that it can be used at enterprises planning to issue their own bonded loans.

Little is known about how executive gender shapes the inherent conflict of interest between shareholders and bondholders. Using a sample of almost 100,000 unique bond‐year observations, this study investigates how the appointment of female chief executive officers (CEOs) lowers the default outlook. Our evidence indicates that bond yield and bond volatility are significantly lower after a female takes the helm at a firm. This executive gender effect remains highly statistically and economically significant across various robustness checks and after addressing endogeneity concerns. Female CEOs lower the default risk component of the bond yield but have no material impact on the liquidity component. Subsample analysis substantiates the conditional effect of female CEOs on bond yield and bond volatility. Our evidence indicates that female CEOs' risk‐averse attributes pass through the credit risk and information asymmetry channels. [ABSTRACT FROM AUTHOR]

The high costs of disclosing confidential information lead firms with proprietary information to prefer private debt (bank loan) to public debt (corporate bond). We provide empirical evidence supporting this proposition using the staggered adoption of the inevitable disclosure doctrine (IDD) by US state courts that exogenously increased the value of proprietary information. The focal firms are significantly less likely to issue bonds after the IDD adoption. Financing through public debt decreases more for firms in which the protection of proprietary information is relatively more important. [ABSTRACT FROM AUTHOR]

This study investigates the determinants of trading activity in the U.S. corporate bond market, focusing on the effects of Seasonal Affective Disorder (SAD) and macroeconomic announcements. Employing the General-to-Specific (Gets) Autometrics methodology, we identify distinct behavioral responses between retail and institutional investors to SAD, noting a significant impact on retail trading volumes but not on institutional trading or bond returns. This discovery extends the understanding of behavioral finance within the context of bond markets, diverging from established findings in equity and Treasury markets. Additionally, our analysis delineates the influence of macroeconomic announcements on trading activities, offering new insights into the market's reaction to economic news. This study's findings contribute to the broader literature on market microstructure and behavioral finance, providing empirical evidence on the interplay between psychological factors and macroeconomic information flow within corporate bond markets. By addressing these specific aspects with rigorous econometric techniques, our research enhances the comprehension of trading dynamics in less transparent markets, offering valuable perspectives for academics, investors, risk managers, and policymakers. [ABSTRACT FROM AUTHOR]

This study examines the performance of worldwide corporate sustainability bonds issued from 2014 to 2020. Unlike traditional bonds, the proceeds of sustainability bonds are utilised for financing projects to bring about environmental and socio‐economic benefits. We analyse the short‐term market reaction to announcements of sustainability and traditional bond issuance and document that the stock market reaction to an announcement of sustainability bonds is stronger than that for traditional bonds. We also find that multiple issuers of sustainability bonds achieve a more favourable market reaction than single issuers. Finally, we examine if environmental, social and governance (ESG) scores can positively and significantly impact the corporate performance of firms through the lens of sustainability bond issuances. We find that ESG scores are the primary performance drivers for firms, and the effect is more pronounced for firms that issue sustainability bonds. Overall, the results suggest that issuers of sustainability bonds show their commitment towards environmental and societal goals and thus benefit from favourable stock market reactions. [ABSTRACT FROM AUTHOR]

We investigate the financing and performance of international entrepreneurship in an environment that was characterized by severe information problems and very weak investor protection. Despite these problems, new ventures could raise large amounts of equity and debt on the Belgian capital market between 1890 and 1914. Many of these firms were international new ventures (INVs) with their main operations abroad, often far away from Belgium. We find that INVs raised much more capital but were less likely to pay a dividend than domestic new ventures (DNVs). They were less likely to issue a bond and had a higher cost of debt when operating further away from Belgium. Performance after listing was generally bad for new ventures throughout the period, but it was much worse for INVs than for DNVs. Our findings confirm contemporary arguments that unprotected, financially illiterate investors were expropriated by INV founders. [ABSTRACT FROM AUTHOR]

Proponents of quantitative easing (QE) unconventional policy have rather overstated some evidence that structural time series models do not predict long‐term asset prices and yields as well as naive random walk forecasts, implying that predictions of price reversals cannot be profitable and, therefore, that QE effects are not transitory. Indeed, in this work we present evidence that naive models do not outperform structural vector autoregressive and Markov switching models in out‐of‐sample forecasting of corporate bond yields purchased by the European Central Bank, when the information set includes base money growth. It turns out that structural time series models provide additional information regarding the likelihood of price reversals, thus motivating investors to offset the effects of QE interventions if they perceive unconventional monetary policy regimes as temporary. [ABSTRACT FROM AUTHOR]

Financial market is expected to play an important role in transition towards more sustainable setup of the business environment. The European Commission published the EU’s Strategy for Financing the Transition to a Sustainable Economy in 2021, requiring the inclusion of environmental, social and governance considerations into investment decision making. Yet, small, open EU economies, such as Slovakia, are in a specific position when implementing this legal framework. For instance, Slovakia does not have any meaningful stock market to speak of, although its bond and collective investment markets perform better. To assess the adoption of sustainable finance elements and to assess the convergence on the Slovak bond market towards standard practice, we investigated current practices on the corporate bond market of nonfinancial corporations. We conducted our research through a review of corporate bonds prospectuses published during 2020-22, in which, to assess current market practices, we examined and evaluated selected criteria and indicators related to issuers and bonds and compared them. These criteria include for example issuer´s business and purpose of finance, form, yield, security, or transferability of bonds. We find that relevant variable criteria and indicators related to reviewed bonds, compared in our research, are similar, indicating that the market converged into a standard practice. Finally, we find almost no evidence of adoption of the sustainable finance elements although there are hints of market uptake of sustainable practices.

In this paper, we presented an asymptotic relationship between the single threshold model and the model with different upgrade and downgrade thresholds for credit migration problems with fixed boundaries. By partial differential equation (PDE) techniques, we proved that the solution of the asymmetric threshold problem converges to that of a single threshold problem uniformly as one of the asymmetric thresholds approaches the other. [ABSTRACT FROM AUTHOR]

Featured Application: Papermaking and printing industry, usability, i.e., legibility of printed text. Invasive alien plant species (IAPS) may cause threats to native biodiversity in ecosystems. Researchers have been investigating all the possible ways that they can be used effectively for other purposes. Since IAPS are capable of forming cellulose fibre nets, in this research, papers were made from three different types of IAPS (Japanese knotweed, giant goldenrod, and black locust). This research examined these IAPS papers and their effectiveness when used as printing substrates. In comparison to commercial office paper, the differences in basic, surface, optical, and microscopic properties were measured. As a widely used technology, inkjet printing was applied. We tested a commonly used sans-serif typeface (which has been established as being more legible than other typefaces in previous research) in three different type sizes (i.e., 8, 10, and 12 pt). According to the results, paper made from IAPS could offer some usable properties and acceptable legibility, especially when printing typefaces with specific attributes, such as moderate counter size, higher x-height, and minimal differences in the letter stroke width, are used. An appropriate typographic tonal density should be achieved in combination with an adequate letter size, e.g., 10 pt type size when a sans-serif typeface is used. [ABSTRACT FROM AUTHOR]

In this paper, we propose an extended credit migration model with asymmetric fixed boundaries and multiple ratings, for a more precise depiction of credit changes in the real world. A model with three ratings is established and analyzed as an example, and then the results are generalized to a general multirating form model. We prepare the model meaningfully by arranging the asymmetric boundaries in a suitable order. A PDE system problem is deduced, and the existence and uniqueness of the solution for the problem are obtained using PDE techniques, which further ensure the rationality of the model. Due to the flexible configuration of asymmetric boundaries, the multirating model has various types of structures in the buffer zones where the credit rating keeps its original state. For instance, the two buffers in the three-rating model may be separated, connected, or intersected, as presented in the numerical results for different boundary parameters. [ABSTRACT FROM AUTHOR]

The convention when calculating corporate bond trading costs is to estimate bid–ask spreads that customers pay, implicitly assuming that dealers always provide liquidity to customers. We show that, contrary to this assumption, customers increasingly provide liquidity following the adoption of post-2008 banking regulations, and thus, conventional bid–ask spread measures underestimate the cost of dealers' liquidity provision. Among large trades wherein dealers use inventory capacity, customers pay 40%–60% wider spreads than before the crisis. Customers' balance-sheet capacity and their trading relationships with dealers are important determinants of customer liquidity provision. This paper was accepted by Bruno Biais, finance. Supplemental Material: The internet appendix and data are available at https://doi.org/10.1287/mnsc.2022.4646. [ABSTRACT FROM AUTHOR]

This paper explores the informational role of the Loan Only Credit Default Index (LCDX) on the pricing of syndicated loans. Despite an extensive body of research on credit indices and loan pricing, limited studies have comprehensively assessed the complex relationship between the LCDX and individual loan spreads. Contrary to indices like the CDX, which are largely linked to corporate bonds, the LCDX directly pertains to the syndicated secured loan market, offering valuable insights about the overall credit default market and the cost of credit risk insurance. Preliminary results reveal a pronounced positive correlation between the LCDX spread and the syndicated loan spread, particularly noticeable amongst borrowers with lower credit quality. The paper highlights the LCDX's pivotal role in conveying secondary credit market information, with critical implications for credit risk management and financial regulations. [ABSTRACT FROM AUTHOR]

Interest rates have risen rapidly in many advanced economies over the last two years, leading to a monetary squeeze. The impact of this squeeze varies across countries due to factors such as private debt levels, the distribution of debt, and the average maturity of fixed rate debt. The UK, Italy, and Germany are expected to be the hardest hit economies, while Korea and Japan will be the least affected. Other indicators of the monetary squeeze include money and credit growth, changes in bank credit standards, quantitative tightening, and property price changes. Overall, the findings suggest downside risks to growth in Italy, Spain, and Australia, while supporting positive GDP forecasts for Korea and Japan. [Extracted from the article]

ABSTRACT: This study investigates the relation between the corporate bond market and the main debt financing alternatives available to firms in Brazil from 2004 to 2014. In this period, three main sources of debt financing were available: loans from commercial banks, loans from the National Development Bank, and the issuance of international bonds. We analyze the characteristics of each alternative, as well as their advantages and disadvantages in relation to corporate bond issuance, considering three main aspects: i) total cost, which includes the interest rate, taxes and fixed costs; ii) maturity; and iii) contracting speed. The results corroborate the initial hypothesis that, although the alternative debt sources competed with corporate bonds, there was also a complementary relation among them.

This study investigates the determinants of trading activity in the U.S. corporate bond market, focusing on the effects of Seasonal Affective Disorder (SAD) and macroeconomic announcements. Employing the General-to-Specific (Gets) Autometrics methodology, we identify distinct behavioral responses between retail and institutional investors to SAD, noting a significant impact on retail trading volumes but not on institutional trading or bond returns. This discovery extends the understanding of behavioral finance within the context of bond markets, diverging from established findings in equity and Treasury markets. Additionally, our analysis delineates the influence of macroeconomic announcements on trading activities, offering new insights into the market’s reaction to economic news. This study’s findings contribute to the broader literature on market microstructure and behavioral finance, providing empirical evidence on the interplay between psychological factors and macroeconomic information flow within corporate bond markets. By addressing these specific aspects with rigorous econometric techniques, our research enhances the comprehension of trading dynamics in less transparent markets, offering valuable perspectives for academics, investors, risk managers, and policymakers.

• This study examines the impact of the ASC 842 lease standard on bond pricing. • After ASC 842, bond yield increases, particularly in undervalued lease liabilities. • The relation depends on firms' lease use, complexity, and information environment. • We highlight the decline in credit ratings as economic implication. This study examines how the formal recognition of lease liabilities required by ASC 842 affects corporate bonds pricing. We document significant bond yield increases with the unexpected off-balance sheet liability revealed by the company. The yield reaction displays an asymmetric pattern, with an increase in yields for previously underestimated operating lease liabilities, but no correction for overestimations. Credit ratings are more likely to be downgraded at firms with severely underestimated operating leases. Collectively, our results suggest that ASC 842 has implications for corporate bond pricing. [ABSTRACT FROM AUTHOR]

This paper documents the existence of de facto seniority in the primary market for corporate bonds. Analysis of Korean data from 2018 to 2021 shows that investors require larger yield spreads for debt with later maturities in an issuance cohort. This relation is robust to controlling for macroeconomic conditions, important issue characteristics, the stated use of proceeds, and alternate fixed effects. • This paper studies the primary market for corporate bonds in Korea from 2018 to 2021. • De facto seniority, or increased credit risk by order of maturity, is priced. • Results hold to various issue and macroeconomic controls, and alternate fixed effects. [ABSTRACT FROM AUTHOR]

[Display omitted] • GDLs with patterned hydrophobicity have been investigated for PEFCs. • Three different wettability patterns have been proposed. • Their effect on the fuel cell performance was compared to the uniformly treated GDLs. • GDLs with patterned hydrophobicity showed superior fuel cell performance. • The patterned GDLs demonstrated less oxygen transport resistance. Flooding of the cathode due to water accumulation is one of the biggest limiting factors in the performance of polymer electrolyte fuel cells (PEFCs). This study therefore attempts to solve this issue by fabricating gas diffusion layers (GDLs) with differently patterned hydrophobic regions. The GDLs in three different patterns (triangular, diamond, and inverted-triangular) were prepared by brushing a Polytetrafluoroethylene (PTFE) solution onto commercial carbon papers through a mask and tested in PEFCs. The patterned GDLs results in superior performance in all cases compared to a uniformly PTFE-treated GDL. Notably, the oxygen transport resistance is significantly reduced, indicating that the water accumulation in the cathode is avoided. This is attributed to the patterned hydrophobicity gradient providing distinct pathways for water and oxygen. The GDL with triangular patterning displays the highest peak power density, due to the fact that the untreated less hydrophobic region is in direct contact with the cathode outlet in this case, facilitating the removal of excess liquid water. Overall, the study confirms that the GDLs with patterned hydrophobicity could be used to enhance the performance of commercial PEFC systems by facilitating water management, potentially leading to improved efficiency and durability. [ABSTRACT FROM AUTHOR]

In this paper, we conduct an empirical evaluation of currency hedging (FXH) strategies designed for Latin American investors managing portfolios of US assets with performance measured in their local currency. By analyzing the volatility and value-at-risk (VaR) of the hedged portfolio, our results reveal that FXH is inefficient in lowering portfolio risk when applied to underlying foreign risk-assets like equities and low credit quality corporate bonds. Conversely, a significant reduction in volatility is evident with FXH when the investments are in safer assets, such as high-grade government and corporate bonds. • We focused on Latin American investors that invest in assets denominated in USD. • We studied effectiveness of FX hedging strategies on reducing portfolio risk. • There are no optimal strategies when the portfolio is composed by risky assets. • Hedging currency risk is recommended for high-quality assets. [ABSTRACT FROM AUTHOR]

The role of green financing in propelling corporate green transformation and sustainable growth has attracted a lot of interest. Regarding their function in promoting corporate green transformation, green bonds—a crucial part of green finance—pose an important research question. This study, targeting Chinese A-share listed corporates, employing double machine learning models, aims to delve into the impact and mechanisms of green bond issuance on corporate green transformation. The findings indicate that issuing green bonds significantly drives corporate green transformation, especially in state-owned, smaller-scale, and non-manufacturing firms, where the impact is more evident. Further analysis discloses that green bond issuance primarily facilitates corporate green transformation through its functions in green investment and financing, green regulatory compliance, and green governance. This study serves as a theoretical reference, guiding businesses in seizing emerging opportunities in the green bond market and actively undertaking green transformation projects, thereby catalyzing a comprehensive economic transition. [ABSTRACT FROM AUTHOR]

Among the different metal nanoparticles for formulating inkjet-based conductive inks, gold remains the best choice for fabricating different patterns on economical and bio-degradable substrates such as commercial photo papers for developing low-cost sensing devices. Formulating customized gold nanoparticle (AuNPs) inks remains challenging as the ink must meet specific physical, chemical and rheological properties to achieve appropriate jettable behaviour and printable characteristics. It should exhibit well-controlled viscoelastic response for the smooth and optimized flow through the nozzles and then cure immediately to facilitate the shape retention of deposited feature. In this work, the jettability window definition framework using dimensionless numbers such as Re, We, Ca, and Z are defined for the aqueous-based AuNPs inks synthesized via ultrasonic spray pyrolysis technique and formulated into three concentration levels of 300, 600, and 1200 ppm. A theoretical CFD based simulation study is conducted to observe the ink droplet formation behaviour at different droplet velocities through inkjet nozzle. Among these formulated inks, 1200 ppm shows the most favourable behaviour as obtained through the simulation and jettability window results. It is tested further to see how different printing settings, like pulse voltage and number of repetitions, affected the continuity and density of the ink, affecting the quality of the printed AuNPs. This work demonstrates the process capabilities of inkjet printing technology by testing the formulated AuNPs ink. [Display omitted] [ABSTRACT FROM AUTHOR]

[Display omitted] • Facile and scalable self-assembly of perylene diimide polymer with carbon paper. • Effective facilitation of carrier separation by π-π built-in electric field. • Narrowed band gap and low VB due to the VB tail states induced by π-π interactions. • Enhanced photocatalytic water oxidation activity of the PDIP/CP photocatalyst sheet. • Suitability of the PDIP/CP photocatalyst sheet for large-scale applications. Photocatalytic water splitting is a highly promising future energy technology. In contrast to the extensive work on particulate photocatalysts, there is still a lack of sufficient investigation for regularized photocatalysts. Here, from perylene diimide polymer (PDIP) and commercial carbon paper (CP), we develop a self-assembled PDIP/CP photocatalyst sheet that is easily scalable and can be used for photocatalytic water oxidation. Driven by strong interfacial π-π interactions, the PDIP spontaneously adsorbs onto the CP, which leads to a narrowed band gap, down-shifted VB edge, and enhanced separation of the photogenerated charge carriers of the PDIP. Under visible light, the PDIP/CP photocatalyst sheet shows significantly enhanced photocatalytic water oxidation activity (4 h cumulative oxygen evolution is 1.7 times higher than that of the powder-suspended system) and considerable cycling stability. The PDIP/CP photocatalyst sheet has the potential for large-scale device applications. [ABSTRACT FROM AUTHOR]

We analyze the potential of the European Union (EU) Taxonomy (ET) for Sustainable Activities to mobilize investments for the sustainability transition toward urban nature-based solutions (UNBS). We map the current investment landscape of UNBS in Europe and combine this mapping with document analysis of UNBS inclusion in the ET to understand how the ET might help overcome the well-documented barriers to UNBS finance. We suggest that the ET has a legitimizing effect on UNBS as climate investments, which can support their uptake, but also conclude that only some UNBS subtypes are explicitly included when they fit with existing investment classes. In particular, the ET (1) disregards innovative - and specifically urban - UNBS types and (2) fails to provide incentives for investments that can deliver multiple sustainable objectives, which would enhance the investment case for UNBS. Since the current investment landscape of UNBS is characterized by a strong presence of public actors and a high incidence of co-financing, we recommend that public actors leverage the ET to obtain private funding for UNBS via (green) bond issuance and public-private co-finance instruments. Our analysis indicates that the ability of the ET to upscale investments for specific sustainability transitions depends on the interplay among their current investment landscapes, specific financing barriers, and explicit inclusion in the ET. • The EU Taxonomy (ET) explicitly promotes investment only into specific urban nature based solutions (UNBS). • The effectiveness of the ET for unlocking private investments is likely to be heterogeneous across urban NBS. • ET points out institutional investors having potential of investment in UNBS by holding shares of firms that fund UNBS. • Under the ET, some financial instruments have higher capacity of scaling-up investments into UNBS – corporate green bonds. • The ET may serve as a vehicle for enabling public-private co-investments and accelerate sustainability transitions. [ABSTRACT FROM AUTHOR]