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CHINA PUT its first domestically built aircraft-carrier into service last December, the culmination of three decades of work. The government hopes for a faster return on efforts to create what [...]

Purpose--The purpose of this paper is to directly examine the information hypothesis of S&P 500 index inclusion announcements by investigating the degree to which information beyond Standard & Poor's eight stated criteria enters the inclusion decision. Design/methodology/approach--Isolating a sample of S&P 500 additions and their eligible candidates during 1987-2004, this paper employs logistic analysis that identifies factors ex post beyond the stated criteria that help distinguish the type of information that influences the final selection decision and that is arguably priced at the inclusion announcements. Findings--The evidence indicates that, when choosing among new S&P 500 candidates, the S&P's committee relies primarily on publicly available information related to enterprise risk and historical performance. Material, private insight into future value-relevant information plays at most a small part in the selection. Research limitations/implications--The results suggest that index additions convey limited new information about added firms. Studies analysing index additions should start with the presumption that index inclusion announcements are information-free events, and focus on the consequences of index inclusions such as liquidity, awareness or arbitrage risk, in their relation to index premia. Originality/value--The results indicate that the previous evidence supporting the information hypothesis using the S&P 500 inclusions is not compelling. Keywords Investment appraisal, Financial services, Indexing, Stocks Paper type Research paper DOI 10.1108/03074351011039418

Purpose The purpose of this paper is to examine the relationship between underwriter reputation and initial public offerings (IPOs) initial returns over a 24-year period, from 1980 to 2003. Design/methodology/approach Two-stage least-squares regression analysis on data from IPOs offered from 1980 to 2003 is used to determine how the choice of IPO underwriter is related to initial returns when considering reputation as an endogenous variable. Findings This study shows, consistent with prior literature, that underwriter reputation is statistically significantly negatively related to initial returns from 1980 to 1991 and statistically significantly positively related to initial returns from 1992 to 2003, when reputation is taken as an exogenous variable. When considering the choice of the reputation of underwriter as endogenous to characteristics of the firm, the reputation of an underwriter is significantly positively related to IPO initial returns for 1980 to 2003 and 1992 to 2003 and insignificantly related, for 1980 to 1991. Originality/value--This study adds value to finance literature in that it extends the research on the relationship between IPO initial returns and underwriter reputation. It also furthers the existing research on IPO anomalies and notes characteristics in this field of financial markets that may be important to both issuers and investment banks. Keywords Investments, Equity capital, Underwriting, Flotation Paper type Research paper DOI 10.1108/03074351011027501

Jerry Del Missier's promotion as president of Barclays Capital (BarCap) has made him the likely successor to BarCap chief executive Bob Diamond. Diamond believes that the technology that Jerry Del Missier built on BarCap is producing record performance for the company. Public opinion on Jerry Del Missier, as well as his views, are presented.

With the growth in over-the-counter derivatives markets in recent years and the corresponding development of synthetic securitization technology, the regulatory issues surrounding structured finance transactions by United States banks and [...]

The Carlyle group based in Washington is the richest and most successful private-equity firm with 144 companies and more than 99 real estate holdings. The story of its most conspicuous partner David Rubenstein is presented and ways he has made billions of money in the firm is detailed.

Since the go-go 1990s, mounting problems with Wall Street stock recommendations--bias, conflicts of interest and fraud--have cast an increasingly negative light on sellside research. With the whopping $1.4-billion settlement in [...]

In the 1980s, the average first-day return on initial public offerings (IPOs) was 7%. The average first-day return doubled to almost 15% during 1990-1998, before jumping to 65% during the [...]

Susan Ross recalls sitting in a comfortable chair in front of the hiring manager's desk, waiting for the job interview to begin in earnest. But it never did. The manager [...]

A On May 5, the process of European integration will take mother giant step forward with the addition of 10 new states--Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, [...]

Citigroup's much-vaunted full-service banking model has been put to the test in Latin America over these last three turbulent years. The bank has a long history in the region, dating [...]

"When you go in, you have to go into it in the spirit of partnership," says Charlie Cortese, managing director and head of outsourcing for Lehman Brothers. That's the bottom […]

On larger deals, certainly those above 500m [euro], the job of arranging mezzanine debt is now almost exclusively done by the one-stop-shop investment banks, which are able to underwrite bigger [...]

The following data show where major broker/dealers route their orders for Amex- or regional exchange-listed securities, a proxy for exchange-traded funds. The data is from the fourth quarter of 2002, [...]

In Wall Street's risk-taking culture, the risk manager use to get overruled by the investment bankers. But not anymore. The banks have restructured and risk management is at the core [...]

Bill Hambrecht left the investment finance business and his company Hambrecht and Quist Inc. in 1991. H & Q was purchased soon thereafter, and with his share in the profits, Hambrecht created Hambrecht Vineyards and Wineries.

The operations and management of TS and B Holdings Inc of Orlando, FL, are discussed in detail by executives Scottt R. Neils and Richard Harris. The company offers investment and merchant banking services.

This is an interview of Stephen Sigmond, analyst with RBC Capital Markets, its company, internet software/services, Internet security, Internet infrastructure and content management.

During a panel discussion, David Doft, Executive Director and Senior Analyst at CIBC World Markets and William Warmington Jr., Director in the Equity Research Department at SunTrust Robinson Humphrey, have their views on the advertising and marketing services industry in the world today.

Maturing portfolios should result in fine wines, not bad whines. To help ensure they do, some organizations are using new techniques for quantifying the drivers of portfolio performance. These new [...]

Industry experts have been forecasting a boom in tri-party repo in Europe for what seems like an eternity. How often have we heard the bold prediction that this year the [...]

While some corners of the industry may still be reluctant to embrace change, the underlying customers are becoming more aware of the sorts of information that they can and should [...]

Erich Pohl can barely contain himself. A simple enquiry as to the progress of the restructuring of Dresdner Kleinwort Wasserstein's (DrKW's) securities financing business prompts an excited outpouring that lasts [...]

Success can be contagious. Like a cough or a cold, it can quickly make its way around the office. Thankfully, the symptoms are a lot more positive. Given the analogy, [...]

The paper examines the management of traders in financial markets from the perspectives of agency and prospect theory. Using interview data from a sample of traders and managers in four investment banks, the paper argues that managers focus on avoiding losses rather than making gains. This focus emerges from the characteristics of managers and the nature of their role. The implications for agency and prospect theory, together with the policy issues for managers, are discussed.