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Cambridge Centre for Finance (CCFin)

Long-term economic outlook and equity prices

by Dr Adelphe Ekponon, Research Associate, Cambridge Centre for Finance and Cambridge Endowment for Research in Finance Dr Adelphe Ekponon The very first asset pricing models (also called Capital Asset Pricing Models or CAPM) have postulated that the only risk…

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Brexit: investor paranoia and the financing cost of firms

Financial markets faced a bumpy ride in 2018. The Financial Times report that global bond and equity markets shrank $5tn last year. Two major risks have been disrupting the markets during the past year: US-China trade dispute and Brexit. The…

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Reinvesting market power for the betterment of shareholders

Dr Scott B. Guernsey On the supply side, highly competitive industries are generally characterised as having many firms and low barriers to entry. The first condition implies that existing firms cannot dictate or influence prices, and the second that new…

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Guaranteed bonuses in high finance: to reward or retain?

by Dr Scott B. Guernsey, Research Associate, Cambridge Centre for Finance and Cambridge Endowment for Research in Finance Public distaste for high finance reached an all-time high in March of 2009, as the American International Group (AIG) insurance corporation announced…

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Is diversification always good?

Probably every Fin 101 class teaches the principle of diversification: do not put all your eggs in one basket. Diversification allows investors to earn the same return but with possible lower risk. Theoretically, any rational investor would pursue the maximal…

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Alternative finance (The Cambridge Judge Business Debate podcast series)

We've heard all the buzz phrases, ranging from 'peer-to-peer lending' to 'cryptocurrencies'. But behind the hype, what exactly is alternative finance, and what are the benefits and risk? In this episode, joining podcast series host Michael Kitson, University Senior Lecturer…

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Some recent developments in mathematical finance

by Dr Alex S.L. Tse, Research Associate, Cambridge Centre for Finance and Cambridge Endowment for Research in Finance A few weeks ago I attended the 10th World Congress of the Bachelier Finance Society in Dublin. To those who do not…

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How (in)efficient is the stock market?

by Dr Yuan Li, Research Associate, Cambridge Centre for Finance and Cambridge Endowment for Research in Finance In 2013, the Nobel committee split the economic prize to Eugene Fama – the pioneer of efficient market hypothesis (EMH) and Robert Shiller…

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Embrace the randomness

by Dr Alex S.L. Tse, Research Associate, Cambridge Centre for Finance and Cambridge Endowment for Research in Finance Excerpt from the CBS sitcom "The Big Bang Theory", S05 E04: Leonard: Are we ready to order? Sheldon: One moment. I'm conducting…

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Contingent convertibles: do they do what they are supposed to do?

by Dr Hui (Frank) Xu, Research Associate, Cambridge Centre for Finance and Cambridge Endowment for Research in Finance When Lehman Brothers was in deep water in September 2008, the US federal government and the Federal Reserve decided not to bail…

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