A total of eleven papers in this volume represent recent research on important
topics in finance. The contributions include analyses of issues relating to
asset prices, the behavior of stock returns, and capital-raising activities.
Hodges, et al. employ stochastic dominance arguments to show that the
efficiency of time diversification depends on the degree of autocorrelation in
security returns. In their study of the announcement effects of ninety-three
minority equity investments, Chan, et. al. find a neutral stock price response
on average for acquiring firms but a significantly positive response for
selling firms. Nguyen, et al. provide evidence on the returns structure of U.S.
information technology stocks surrounding the bursting of the internet bubble
in early 2000. In a study of the informational effects of auditor reputation,
Godby and Mahar, Jr. find that implied volatilities for firms audited by
Andersen have increased relative to those for firms audited by other Big Five
firms. Charaput and Chang find that the usage of installment receipts enhances
liquidity in Canadian secondary equity offerings.
The contributions to this volume also examine important issues in international
finance and financial institutions. Brailsford, et al. use a VECM technique to
examine Purchasing Power Parity and causality between the yen and the dollar.
Sarmas studies the impact of Hong Kong´s fixed exchange rate system and
Singapore´s floating exchange rate system on the correlation between the US and
the two respective countries´ stock markets. Povel develops a theoretical model
to explain multiple banking as a commitment device. Baer, et al. develop a
model and empirically examine how thecreation of a futures clearinghouse can
reduce the need for margin in bilateral and multilateral settings. Roberts and
Siddiqi provide an empirical analysis of the link between collateralization and
the number of lenders in private debt contracts. Finally, Tripp et al. empi
