CATALPA PLANTING AS A FINANCIAL INVESTMENT

Financial Simulation and Investment Expectations

Financial Simulation and Investment Expectations

Executive summary Future investment returns are uncertain; no reliable means to foresee them exists. However, institutions and individuals making financial decisions need an approach to model the range of possible future returns. Any approach requires two fundamental ingredients: • First, long-term historical returns must be examined to determine the attributes and interrelationships that chara...

Investment, Irreversibility, and Financial Imperfections¤

Research ...nds that ...rms’ investment decisions are distorted by irreversibility and ...nance constraints. Whereas the existing literature examines the e¤ects of these features separately, this paper studies their interaction. The impact of these constraints on a ...rm’s incentive to invest is characterised using option pricing techniques. Financial constraints reduce the initial capacity, ra...

Financial contagion in investment funds

Many new models for measuring financial contagion have been presented recently. While these models have not been specified for investment funds directly, there are many similarities that could be explored to extend the models. In this work we explore ideas developed about financial contagion to create a network of investment funds using both cross-holding of quotas and a bipartite network of fu...

Financial Innovation, Collateral, and Investment

We show that financial innovations that change the collateral capacity of assets in the economy can affect investment even in the absence of any shift in utilities, productivity, or asset payoffs. First we show that the ability to leverage an asset by selling non-contingent promises can generate over-investment compared to the Arrow-Debreu level. Second, we show that the introduction of naked C...