Many investment firms reward portfolio managers based on their performance. This article investigates a manager's optimal active risk policy using stochastic programming techniques. Our multiple-period model incorporates the most common incentive-fee structures, and captures the risk that the...

Traditional theories of capital structure imply a consistent relationship between firm profitability and firm leverage. Empirical data, however, suggest that the relationship is not monotonic. In the cross-section of firms, non-profitable firms become significantly more leveraged as losses...

This paper examines the role of accounting conservatism on firm investment behavior in China. We find that the association between accounting conservatism and capital expenditure is significantly positive when inside capital is not enough to use for investment, suggesting that conservatism can...

Advanced first-order second-moment (AFOSM) is commonly used to obtain an upper-bound estimate for a probabilistic analysis. This study presents a new AFOSM application to engineering seismology, estimating major earthquake probabilities based on fault length and slip rate, along with an...

In recent years, coal price has risen rapidly, which has also brought a sharp increase in the expenditures of thermal power plants in China. Meantime, the power production price and power retail price have not been adjusted accordingly and a large number of thermal power plants have incurred...