We show that under the Black Scholes assumption the price of an arithmetic average Asian call option with fixed strike increases with the level of volatility . This statement is not trivial to prove and for other models in general wrong. In fact we demonstrate that in a simple binomial model no...

We show that the sensitivity of corporate investment to stock price is higher for firms cross-listed in the U.S. than for firms that never cross-list. This difference is strong, does not exist prior to the cross-listing date, and does not vanish over time after this date. Moreover, the impact of...

Con el objetivo de definir la forma de estimar teóricamente el costo de capital enColombia, se llevó a cabo una revisión de la literatura correspondiente en las bases dedatos electrónicas de las principales universidades del país. A partir de una revisiónde las prácticas metodológicas...

The paper investigates the incentive effects of performance-vested stock options (PVSOs) in aligning management interests with shareholder wealth. Performance targets attached to option vesting would prevent executives from receiving rewards from outcomes that are unaffected by their effort.Such...

In the article are presented results of empirical sociological examination of the percent of postponed trade receivables of firms and term of payments delay after maturity of trade credits. There are analyzed the causes for interfirm late payments in Bulgaria and actions that firms undertake as...

The authors show that there is a negative relationship between economic policy uncertainty (EPU) and firm overinvestment using Korean data from 2007 to 2016. Since Jensen (1986) shows that a firm's free cash flow is an important factor of overinvestment, the authors examine how free cash flow...

This paper shows that ten methods of company valuation using discounted cash flows (WACC; equity cash flow; capital cash flow; adjusted present value; residual income; EVA; business's risk-adjusted equity cash flow; business's risk-adjusted free cash flow; risk-free-adjusted equity cash flow; and...

In this paper, we describe the four main groups comprising the most widely used company valuation methods: balance sheet-based methods, income statement-based methods, mixed methods, and cash flow discounting-based methods. The methods that are conceptually "correct" are those based on cash flow...