This report evaluates the ex-dividend stock price behavior in the London Stock Exchange to find out if the share prices really drop by the same amount as the dividend on the ex-dividend day. The test data covers Eighty FTSE100 corporations of the London stock exchange for the period 2001 to 2006. Research question: Do returns …

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The Real Option Approach applied on Foreign Direct Investment Scenarios

The Real Option Approach (ROA) has been put forth as the answer to the problem of valuing manager flexibility and project risk within the framework of capital budgeting. Within this dissertation the ROA is used on one of the riskiest of corporate ventures particularly foreign direct investment. The 1st two problems presented by the author …

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Substitutes for insider trading

Trading upon not released, insider, information is an illegal activity. Trading in shares that can be assumed to perform in a similar way based on the same information is legal, and potentially profitable. The goal of this thesis is to investigate if substitutes to listed shares exist on the Stockholm Stock Exchange, and whether they provide a similar return when affected by releases of insider information.

International Financial Reporting Standards

The purpose of this thesis would be to examine the legal situation regarding the IFRS-transition in Sweden. Sweden includes a close linkage between accounting and taxation, meaning accounting rules have a material effect on taxation. IFRS currently applies only on group level, and the group isn’t susceptible to tax. However, you will find already indirect …

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Fund manager replacement performance persistence

This thesis will focus on the relation between funds performance and the fund managers. Since there is reason to assume that the manager personally brings an effect to performance, there should also be reason to suspect that a replacement of this manager ought to change the performance of the fund. The purpose of this thesis …

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Shareholder Activism: Can it be an Effective Governance Mechanism?

This paper sets out to examine whether shareholder activism can be an effective governance mechanism, i.e. if it can increase firm performance to the benefit of shareholders. We have based our study on examining and interpreting the results from previous research of the subject. Initially, we describe the theoretical constraints facing shareholder activism. Agency problems …

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Pricing of liquidity: Study of the Stockholm Stock Exchange 1901-1919

This paper studies the importance of liquidity in determining security returns. The study is conducted on the Stockholm Stock Exchange, 1901-1919, a market which at the time suffered from low market turnover. We find out-of-sample effects that liquidity levels are significant determinants of returns. Securities with lower liquidity levels earn, on average, higher returns than …

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