Assignment (MComm)--University of Stellenbosch, 2006. / Bibliography. Also available via the Internet.

Thesis (M.A.)--Dalhousie University, 2005. / Includes bibliographical references (p. 65-71)

The Insider Trading Act of 1999 and JSE regulations require transparency in director dealings and as a result create an unprecedented dissemination of investment signals to the market. This research study used director dealing information and a portfolio time series approach that included the entire population of 13,840 JSE All Share Index (ALSI) director dealings during a 130- month period between 2002 and 2013. With the assistance of a style engine and through an experimental research approach, an optimal Buy and Sell investment style was established. The equal weighted ALSI provided a comparative benchmark. Most studies on JSE director dealings, using an event study methodology, have not identified an investment style to be followed successfully during certain periods. The results have at best shown statistically significant, but economically insignificant, abnormal returns. The results of this study were visually, statistically and economically significant in comparison. It was proven that outside investors should, rationally, acquire shares when directors acquire shares but they should, counter intuitively, purchase shares when directors sell shares. The optimal director dealing investment style for creating a director dealing Buy portfolio includes applying a holding period of four months, a lookback period of three months and a minimum percentage of market capitalisation traded of 0.0013% or more. The optimal director dealing investment style for creating a director dealing Sell portfolio includes applying a holding period of three months, a lookback period of three months and a minimum percentage of market capitalisation traded between 0.005% and 0.030%. The optimal director dealings Buy and Sell portfolios achieved a CAGR (Compound Annual Growth Rate) of 29.5% and 27.8% respectively. The comparative benchmark achieved a CAGR of 19.1% over the same relevant period. / Dissertation (MBA)--University of Pretoria, 2013. / mngibs2014 / Gordon Institute of Business Science (GIBS) / MBA / Unrestricted

Learnerships were introduced by the South African government as a mechanism to address the shortage of skilled people in the workplace. The aim of this research was to determine the perceived value of the return on investment (ROI) of the Chartered Accountant (CA) learnership – specifically from the employers’ point of view. Despite there being 934 learnerships registered in South Africa, there has been minimal ROI that relates directly to learnerships. The research was conducted in three phases. During the first phase, a focus group was convened to identify the components of the financial and non-financial benefits and costs of the CA learnership. These components were included in a survey questionnaire that was completed by 127 respondents during the second phase. In-depth interviews were conducted with eight employers in the third phase to determine the monetary value of the costs incurred in the implementation of the CA learnership. The key findings of the research include the identification of the specific components of the ROI of the CA learnerships, i.e. the financial and non-financial benefits and costs. From a holistic viewpoint, employers perceive the value of the ROI of the CA learnership. / Dissertation (MBA)--University of Pretoria, 2010. / Gordon Institute of Business Science (GIBS) / unrestricted

Diversification is a desirable characteristic of a well balanced investment portfolio. By diversifying investments over -a number of assets, one has a better chance of maintaining overall stability of capital and earning power. Prior to the development of the Markowitz theory, diversification had always been an intuitive process for most investment analysts. Using the Markowitz criteria of efficient diversification, the analyst now has a means of evaluating diversification in an investment portfolio. In his theory of diversification, Markowitz showed that the selection of securities could be made in a scientific manner so as to give a minimum of variation in an investment portfolio. His theory was based on the fact that all securities were not closely correlated in their price fluctuations, and each security had its own characteristics of expected return and variations in expected return. Using a mathematical procedure called quadratic programming, Markowitz suggested that a series of portfolios which had a minimum of variation for a given return could be selected from any list of investment alternatives. The only information needed on each investment alternative was its return based on price fluctuations and dividends, its statistical variance of return, and the amount of correlation between it and the other investment alternatives. The purpose of this thesis is to investigate the diversification in Canadian investment funds. In order to do this, it was necessary to divide the Canadian securities market into a workable number of investment alternatives, and to generate a series of optimum portfolios for each given rate of return. The optimum portfolios, based on the Markowitz criteria for diversification, could then be compared with the actual portfolios of Canadian investment funds. As a further basis of comparison, a series of random portfolios were also generated. The results of the comparisons revealed that Canadian investment funds did not exhibit properties of diversification as defined by the Markowitz criteria. The results also revealed that the investment funds were not significantly better than a random selector. These results could possibly be attributed to the size and structure of the Canadian securities market. A large investment fund, for example, could not concentrate on the few issues needed for proper diversification without affecting prices in the securities market. Another reason for lack of diversification is that the Canadian market is possibly not independent enough to present sufficient variety to the investor who wishes to properly diversify. Finally, there is reason to suspect that the basic philosophy behind the Markowitz approach, may not apply to many of the Canadian investment funds. / Business, Sauder School of / Graduate

The topic for this study was suggested to the writer by Dr. Hans Ernest Ronimois, who felt that the problems of centralized formation and allocation of capital in the U.S.S.R. offered a particularly fruitful field for inquiry. In the United States, or any other free market economy, such problems are solved mainly through the agency of a market system which allocates monetary and material resources on the basis of the price mechanism. In the Soviet Union, on the other hand, the criteria of the market have had to be ignored in the face of central plans calling for intensive development of heavy Industry. The automatic mechanism of the market has been replaced by the arbitrary process of apportionment or allocation effected through the medium of centralized distributive organizations. This study deals at some length first with the origins of investment funds in the American and the Soviet economy. Following upon this issue, a survey is made of the shares of investment funds received by the several prime industries, i.e., iron and steel, electric power, machine building, petroleum, coal, railway transport and construction, in the United States and the Soviet Union. Finally, this study examines various economically disruptive effects of the Soviet apportioning technique, by which is meant the misallocation of financial and material resources in the U.S.S.R.. These deficiencies are concluded to represent a problem the gravity of which is sufficient to make its solution a major concern for Soviet planning authorities. / Arts, Faculty of / Central Eastern Northern European Studies, Department of / Graduate

The notion of beta in the stock market is a concept of risk that has had wide acceptance in the academic and investment communities as a coefficient of non-diversifiable risk. The definition of beta and its use as a measure of risk depends on the empirical validity of the market model. The market model is a linear equation of the form y = a + bx + c where b (the slope of the line) is the beta coefficient: It relates the proportion by which a stock's price will change to a change in the market index. The measurement of the beta value has been tested and proven to be stationary over time. Therefore the estimated values in one period are biased estimates of the future values. Professional managers can select a level of uncertainty at which to operate and have tended to remain at that level over the years. A model such as this for selecting efficient portfolios is a very relative component in the development of improved normative procedure for investment management. Among the possible uses of an effective measure of risk are: 1) the assessment of risk in specific securities as well as portfolios; 2) measurement of the current risk in any group of stocks represented by the various market averages; 3) comparison of the risk of individual securities with that of other securities and the market as a whole; 4) means of screening in search for undervalued and overvalued stocks; 5) aid to timing in buying and selling; 6) a basis for selecting and adjusting portfolio risk to fit an investor's requirements; 7) means of adjustment to take advantage of market trends and a logical basis for investment decision making. In accordance with the above theory of market equilibrium, stock prices would adjust instantaneously in some proportion to the changes in the market index. Given the assumptions of the theory, the length of the period over which beta is calculated should be irrelevant to the measure. The implication is that beta may be useful in short run investment strategy. It is felt that the adjustment process is not instantaneous but incorporates some stocks that may be overpriced and others that may be underpriced. Furthermore stocks may lead or lag the market index into a bullish or bearish market. Trading rules based on the market sensitivity of stocks in the period June 1959 to June 1969 were used to test the profitability of short run investment strategy in rising and falling market trends. These trading rules developed in the ex post were applied in the ex ante from June 1969 to June 1972 to determine if there were any stable relationships. The empirical evidence does not provide very strong conclusions. The results indicate that the adjustment of a stock price relative to the market is not instantaneous. There are stocks that lead and stocks that lag the market into either an "up" or "down" swing. However these relationships are not stable from one period to the next. Where there is stability, the timing is most uncertain. This indicates that the markets are not truly efficient and thus it becomes a test of the major assumption of the market model. Despite this lack of stability the results of the trading rules indicate that beta may be used effectively on a continuing basis in a declining market. The rules which are based on a long term beta help us to identify those stocks which vary widely from their expected prices allowing us to activate trading which is profitable for the portfolio. The findings indicate that beta may be used in this sense as a "loss" minimizing technique. However the obvious limitation is that the trading rules cannot be applied symmetrically to both markets in order to bring the best results. Furthermore there is the major difficulty of predicting the market. Extreme confidence in the filter rules is required. Another problem is that continuous trading alters the portfolio beta at which the manager has selected to operate. The most useful information obtained from the tests is that through further study and the development of better trading rules the technique may be quite useful. / Business, Sauder School of / Graduate

The purpose of this study is, first, to outline the neo-classical investment theory and the main competing hypotheses which seem to form the bases of the policy measures adopted by governments of capital-importing and capital-exporting countries to stimulate the flow of direct private foreign investments (DPFIs), and, second, to re-examine and reconsider a few of the assumptions and implications of the theory and the hypotheses in the light of certain reported investigations of direct foreign investment decisions of firms. A review of the neo-classical investment theory shows that the theory assumes that firms aim at profit maximization, that firms systematically scan domestic and foreign environments for investment opportunities and that firms undertake direct investments, whether domestic or foreign, to maximize their profits. According to this theory, when firms make investment decisions, they have before them a number of investment propositions, both domestic and foreign. They then carefully appraise these propositions in terms of costs, benefits and risks and decide in favour of those propositions which promise them high returns and low risks. This theory therefore implicitly suggests that it is possible to provide considerable stimulation to the flow of DPFIs by merely affecting firms' expectations of returns and risks of such investments. Disagreements over the validity and usefulness of the neo-classical investment theory as an explanation of the flow of DPFIs lead to a formidable number of alternative explanations or hypotheses. Some of t hese are: (1) the higher profit rate abroad hypothesis, (2) the lower costs abroad hypothesis, (3) the monopolistic competition hypothesis, (4) the growth of the firm hypothesis, (5) the marketing considerations hypothesis, (6) the market size hypothesis, (7) the maintenance of market hypothesis, and (8) the product cycle hypothesis. Each of these hypotheses is based on a number of assumptions, most of which seem similar to those made by the neo-classical investment theory for most of them implicitly assume that: (1) firms normally look across their national boundaries for investment opportunities, (2) firms possess financial and suitable managerial resources to undertake direct investments abroad, (3) firms are generally prepared to use their resources to investigate direct foreign investment projects, and that (4) firms make cross country comparisons of projects to determine which project or projects they should undertake. Some reported investigations of the foreign investment decisions of firms, however, suggest that firms do not, in fact, systematically scan the globe for areas to make an investment and that most firms do not normally consider the possibilities of investing abroad. The reasons why firms do not normally look abroad for investment opportunities can probably be found in: (1) organization traditions and attitudes, (2) generally held beliefs of firms, (3) limitation of company resources, (4) departmental structures, (5) complexities of investing abroad, and (6) information and investigation costs. These investigations also suggest that: (1) generally firms consider direct investments abroad only when they are "pressured" (or "threatened") or "persuaded" (or "instigated") to do so, (2) when firms consider direct foreign investment projects, they agree in principle right from the beginning to accept them, (3) firms evaluate direct foreign investment projects sequentially and do not weigh them alongside each other, (4) different firms use different criteria to determine the acceptability of foreign investment projects. This study accepts the conclusions of these investigations and suggests that any theory of DPFIs has to recognize that direct foreign investment alternatives are not given to firms and that there is a need to incorporate the "initiating forces" into the theory. It also suggests that it is probably not possible for countries to provide considerable stimulation to the flow of DPFIs without first devising some policy measures to initiate firms to consider investment opportunities across their national boundaries. / Business, Sauder School of / Graduate

Empirical evidence shows that the Capital Asset Pricing Model (CAPM) is misspecified. Securities of low systematic risk consistently earn more than predicted by the model, the reverse being true for securities of high systematic risk. Whilst the relationship between ex-post returns and systematic risk appears to be linear, the estimated regression coefficients are significantly different from their theoretic values. Various attempts to explain theoretically the causes of the misspecification have been explored, but fail to provide an adequate explanation of all the observed deficiencies. The dissertation examines how the mechanism of bankruptcy affects the structure of returns for corporate financial assets. The hypothesis of the thesis is that the probability of bankruptcy across securities and across time is reflected in the residual return after abstracting from the market. Using stochastic control theory, a two variable extended form of the continuous time analogue of the CAPM is derived. The second variable is associated with the probability of bankruptcy. The model provides a natural explanation of the deficiencies of the CAPM. A discrete time ex-post formulation of the model is used to test empirically the hypothesis. This necessitates being able to measure the probability of bankruptcy. A model formulated in terms of a firm's ability to raise funds, either internally or externally, to cover fixed charges is developed, and the probability of bankruptcy estimated using the maximum likelihood methodologies of logit analysis and probit analysis. The ability of the model to predict bankruptcy is tented on a secondary sample of bankrupt firms. Excellent results are obtained with the model predicting bankruptcy, for some firms, four or five years before the actual occurrence. Using a pooling of time series and cross section data to estimate the coefficients of the regression equation representing the hypothesis, evidence is found indicating that bankruptcy is an explanatory factor of common stock returns. / Business, Sauder School of / Graduate

M.Phil. / The role of foreign direct investment, in driving economic growth and development has been a contested one. There have always been views in favour of FDI and against. Foreign investment is attracted by predictable, transparent, non-discriminatory regulations of the host country. Consequently, negative administrative barriers (legal and regulatory requirements for establishing, operating and locating a business) can deter foreign investors. Administrative processes in South Africa are not consistent, efficient and transparent and they generally interfere with the operation of free markets. Theoretically, foreign investors are likely to invest in countries where administrative processes are consistent, efficient, transparent and high levels of certainty. This study‘s aims were to identify administrative barriers encountered in South Africa by foreign investor and to ascertain the levels of consistency, efficiency and transparency of administrative procedures. The study further propose solutions aimed at improving the levels of consistency, transparency and efficiency of administrative processes in order to easy, simplify or mitigate the burden of these processes. The study adopted a positivistic view and descriptive research method was employed. The survey questionnaire was used as the main data-gathering instrument for this study. The study found out that there were high levels of administrative barriers to foreign direct investment in South Africa and the processes were not consistency, efficient and transparent. The main conclusions drawn from this research were that current administrative processes to foreign direct investment are barriers to investment as they add an extra burden and cost to the investor investing in South Africa. This study proposed a multi-pronged administrative simplification strategies aimed at reducing and simplifying administrative processes.