<p>Recent years have seen a significant increase in growth of the Asian luxury market, of which China has clearly come to make up the new major market. As the strategic considerations for international companies differ between countries, an individual approach needs to be adopted to customize operations. With this master’s thesis, the author aims to map out the key current challenges for international luxury fashion companies in China. Through in-depth interviews with industry experts, the study identifies and analyzes a set of thirteen challenges, and finds unique issues within each of the challenges investigated. While further research is needed to further validate the findings of the study, its results points towards a broad spectrum of challenges and considerations, thus purposedly acting as a springboard for future research.</p>

<p>In this paper we aim to identify the most important factors that influence the decisions made by large Western MNCs concerning post entry changes (PEC) in the BRIC markets. Thiss tudy attempts to explain processes and reasons why these changes take place. In addition we make a comparison between strategies followed and the differences between them for each of the BRIC markets.Most academic literature focuses on entry mode theories, however little has been written onPEC. PEC today is a hot topic in the current international business environment. This isevident in the market as many Western MNCs that invested in emerging markets throughJoint Ventures (JV) during the late 1980s and 1990s are now restructuring their strategies in order to further their growth (Luo, 2007).The paper uses a qualitative study to explain and explore PEC strategies in each of the four BRIC markets, using case studies of three Italian large MNCs: Artsana, De Longhi and Luxottica.The study finds that firstly BRIC markets should not be seen as a whole, as academic literature has a tendency to suggest. Secondly, the study finds that country-specific conditions directly affect PEC choices and decisions differently in each market. We have identified a number of variables which influence PEC, of these economic conditions and institutional context pressures were found to be the most important determinants for PEC within the MNCs studied. This study will help management to better choose appropriate PEC and set the most suitable operational mode for each specific environment.</p>

The final aim of this thesis is to evaluate opportunities and risk factors of investing in China, in terms of pros and cons, and also to elaborate an optimal portfolio strategy. The pros regarding investments in China are (1) the economic liberalisation and reforms of the institutional framework; (2) the Chinese market’s huge potential and the high-growth IT and telecommunications sectors; (3) a favourable macroeconomic climate and an impressive development. The cons are (1) the mismanagement of the state-run companies; (2) the mainland exchanges’ intra-year volatility; (3) the export sector’s performance might decline; (4) the institutional framework is largely responsible for many risk factors; (5) a tougher competition climate after the entry in the WTO. Also, our calculations on an optimal portfolio strategy suggest that less risk-averse investors may want to consider the World/Shanghai portfolio, whereas the World/Shenzhen portfolio might instead suit the preferences of more risk-averse investors.

As globalization influences today’s world markets, many brands are becoming international and global. When a brand is in an international market it creates an opportunity for perceived brand origin to influence the consumers. Brand origin effect refers to the different ways that the perceived origin of a brand influences the consumers, for example, the consumer brand equity or purchase behaviour. The purpose of this dissertation is to investigate brand origins effect on brand image and brand awareness. There has been research on this in the past; however, only few of them have focused on emerging markets. Therefore, we will investigate the brand origin effect in emerging markets. The study is performed in Ecuador, and the data is collected through structured interviews within the target population. The dissertation was done in collaboration with the Swedish company Husqvarna. Therefore, it was the brand awareness and image of Husqvarna in particular that was studied. The results of this dissertation indicate that there are relationships between the variables brand origin, brand image and brand awareness. First of all, there were indications that consumers in emerging markets prefer brands from developed countries. The second relationship that the results indicate is that a more positive image of perceived brand origin means a more positive image of brand image. The last relationship is that a more positive image of perceived brand origin, leads to a higher sense of brand awareness. However, it is necessary to mention that none of these relationships could be proven to be significant through statistical testing. As a result of this, this dissertation provides a good foundation for future research where the relationships should be further studied.

In this paper we aim to identify the most important factors that influence the decisions made by large Western MNCs concerning post entry changes (PEC) in the BRIC markets. Thiss tudy attempts to explain processes and reasons why these changes take place. In addition we make a comparison between strategies followed and the differences between them for each of the BRIC markets.Most academic literature focuses on entry mode theories, however little has been written onPEC. PEC today is a hot topic in the current international business environment. This isevident in the market as many Western MNCs that invested in emerging markets throughJoint Ventures (JV) during the late 1980s and 1990s are now restructuring their strategies in order to further their growth (Luo, 2007).The paper uses a qualitative study to explain and explore PEC strategies in each of the four BRIC markets, using case studies of three Italian large MNCs: Artsana, De Longhi and Luxottica.The study finds that firstly BRIC markets should not be seen as a whole, as academic literature has a tendency to suggest. Secondly, the study finds that country-specific conditions directly affect PEC choices and decisions differently in each market. We have identified a number of variables which influence PEC, of these economic conditions and institutional context pressures were found to be the most important determinants for PEC within the MNCs studied. This study will help management to better choose appropriate PEC and set the most suitable operational mode for each specific environment.

This paper adds to the understanding and transparency of equity pricing in emerging markets. Its novel contribution is that it empirically investigates the pricing of Country Risk in BRIC markets, using a two-factor intertemporal pricing model. Bridging the gap between academics and practitioners, this paper contributes to the debate as to whether or not it is justified to adjust discount rates for emerging market companies – as given by the CAPM – by including an unconditional country risk premium. In choosing between country risk proxies, the sovereign yield spread adjusted for relative equity volatility appears to supersede the classical sovereign yield spread in explaining return variations. Evidence is presented that country risk is priced in India and China indicating some type of market segmentation; in these markets, the addition of a country risk premium to the discount rate is justified. Moreover, the paper complements the market integration literature in that it is shown that the correlation between the change in country risk premium and the equity risk premium might show signs of market segmentation or market integration, rendering the pricing factor for country risk in specific countries significant or insignificant, respectively. © 2010 Soeriowardojo, G.T. All rights reserved.

Recent years have seen a significant increase in growth of the Asian luxury market, of which China has clearly come to make up the new major market. As the strategic considerations for international companies differ between countries, an individual approach needs to be adopted to customize operations. With this master’s thesis, the author aims to map out the key current challenges for international luxury fashion companies in China. Through in-depth interviews with industry experts, the study identifies and analyzes a set of thirteen challenges, and finds unique issues within each of the challenges investigated. While further research is needed to further validate the findings of the study, its results points towards a broad spectrum of challenges and considerations, thus purposedly acting as a springboard for future research.

The main purpose of this Master Thesis has been to evaluate whether active fund management is profitable on Emerging Markets. The material used to examine this consists of 106 actively managed funds, with varying length during the period 1988-2006 and who uses MSCI Emerging Markets (MSCI EM) as benchmark index. The thesis has been written under the supervision of the Asset Management Department of Länsförsäkringar AB (LFAB) and the Department of Production Economics, Linköping Institute of Technology. Apart from the main purpose, the methodology used is also meant to form a template for in-depth or similar studies, preferably by the assigner of this survey, LFAB. The results shows that the median manager underperforms the MSCI EM throughout the whole period, which leads to the conclusion is that active management on Emerging Markets is not profitable. A grouping of the funds based on tracking error still shows that a majority of the managers in all of the groups underperforms against the benchmark. All in all, the relationship between tracking error and the profit of the fund is not significant and managers in groups with higher level of tracking error, most likely, does not outperform the rest of the managers. The material has also been divided into subperiods to assess overall market conditions influence on manager’s performance. The results are principally equivalent with the ones obtained for the period as a whole; however, a slight tendency of better performance in times of stationary rates compared to rising ones is observed. All results are based on NAV-rates of the fund and by the implicit assumption that passive management is free of charge. Naturally the results for the fund managers are improved if a cost of buying the index is considered. However, the median manager is still most likely to be underperforming against the MSCI EM, even when such a cost is taken into account. In every grouping of mangers there are, despite the negative performance of the median manager, still a number (15 - 25 %, depending on the level of tracking error and time period) that outperforms MSCI EM. The mangers performance is therefore studied under the hypothesis that it is the same mangers every year that beats the index. The results indicate persistence on a general level, that it mainly originates from the top rank of mangers and also that this persistence has strengthened during the last few years. This is an interesting result, especially from an investor’s point of view, and also the most remarkable positive result of this thesis. Further studies should therefore be carried out, primarily to examine the practical usefulness of this result. / Det huvudsakliga syftet med detta examensarbete har varit att utreda om aktiv fondförvaltning kan anses vara lönsamt på emerging markets. Materialet som behandlats består av 106 aktivt förvaltade fonder med varierande längd under perioden 1988 – 2006, som alla kan anses ha MSCI EM som jämförelseindex. Studien har utförts på uppdrag av kapitalförvaltningen på Länsförsäkringar AB och är även tänkt att kunna fungera som metodbeskrivning för fördjupade eller liknande framtida studier. Handledning under arbetets gång har, förutom från företaget, även erhållits från Institutionen för produktionsekonomi vid Linköpings tekniska högskola. Då resultatet visar att medianförvaltaren underpresterar gentemot jämförelseindex MSCI EM är slutsatsen att aktiv förvaltning inte är lönsam på emerging markets. Även när förvaltarna grupperas efter aktivt risktagande har majoriteten av förvaltarna inom samtliga grupper en negativ överavkastning. Totalt sett är sambandet mellan aktiv risk och överavkastning mycket svagt, och medianförvaltaren i gruppen som tar högst aktiv risk klarar sig heller inte bättre än övriga grupper. För att undersöka marknadsklimatets påverkan på förvaltarnas prestationer har även delperioder studerats. Resultatet blir i stort sett likvärdigt med det för hela perioden, men vi noterar dock en tendens till att förvaltarna underpresterar mindre i en fas med stillastående kurser jämfört med en expansionsfas. Samtliga resultat har utvärderats utifrån NAV- kurser för fonderna och det implicita antagandet att indexförvaltning kan erhållas kostnadsfritt. Påförs en kostnad även för den passiva förvaltningen blir resultatet för medianförvaltaren något bättre, men fortfarande underpresterar medianförvaltaren i samtliga grupper. Inom varje gruppering av aktivt risktagande existerar ett antal förvaltare (mellan 15 och 25 % av totala antalet, beroende på graden av aktivt risktagande) som överpresterar gentemot index. Skulle det vara samma förvaltare som slår index varje år tyder det på att kategorin som helhet kan vara mer attraktiv än vad resultatet för medianförvaltarna visar. Resultaten från undersökningarna visar på en viss förekomst av persistens i materialet på en generell nivå. Denna persistens verkar framförallt härstamma från de högst rankade förvaltarna och verkar dessutom ha stärkts under senare år. Detta är ett mycket intressant resultat från en placerares synvinkel och är samtidigt det mest intressanta positiva resultatet från denna studie. Vidare studier bör dock företas inom området, framförallt för att utreda den praktiska tillämpbarheten av resultaten.

This paper explores the relationship between presidential elections and sovereign credit default swap (CDS) returns, as well as, equity returns in the Latin American countries, Argentina, Brazil, Chile and Mexico. In particular, this paper tests whether or not presidential elections, which potentially represent political uncertainty and risk, affect sovereign CDS returns. I also analyze stock returns during the elections of each country to establish benchmarks that I compare to the CDS returns. Specifically, I evaluate the movement of CDS and equity adjusted returns (i.e. returns measured as deviations from average returns) over 7 presidential elections from 2005 to 2011. The baseline panel regression did not find statistical significance in the dummy election coefficients, but did find significance in the equity intercept coefficient at the 10 percent level. This result suggests that, on average, adjusted equity returns were higher during election periods than adjusted equity returns outside of election periods. I discuss the implications of these results later in the paper.

Over the years so many academic literatures has revealed that increased number of firms have seen internationalization as a means to gain and sustain competitive advantage and even increase economic of scale, and this has led many western companies to emerging markets. In this paper we discovered that among the pool of Swedish firms, only the MNEs have seen Nigerian market attractive to internationalize to, but just a few of the Swedish SMEs has expanded to the Nigerian market. This research was conducted by doing a qualitative study with the use of phenomenological research approach, during our investigation on the functions of intermediaries in Swedish SMEs internationalization to Nigeria market.Furthermore, we were able to understand the importance and functions of the different marketing intermediaries’ in Swedish SMEs internationalization to Nigeria market. These intermediaries equip the Swedish firms with the required objective knowledge of the Nigerian market, updating them with recent development of the opportunities and threats involved in the Nigerian marketing environment, and linking these Swedish firms to the required government departments, distributors, agent/broker, customers, middle men etc, thereby impacting them with the experiential knowledge. Moreover, it is important for firms to have objective or pre-market knowledge of a particular market before entering that market, but this knowledge is regarded as non-helpful knowledge to firms. But the experiential knowledge is acquired over time in the market, which is regarded as the helpful knowledge. It is evident that the intermediaries equip these firms with both objective and experiential knowledge.Although the opportunities in some emerging markets are very attractive, but the threats in these markets are other factors firms also put into consideration before internationalizing to these markets. This is why thorough market research has to be done so that firms can create effective marketing strategies when they want to expand their marketing activities to emerging markets. Despite the risk and uncertainties involved in doing business in foreign countries, still yet companies selling global products do not have any choice than to internationalize their marketing operations.