Company Sector Liquid Asset Holdings: A Systems Approach

Abstract How do corporate bond mutual funds manage liquidity to meet investor redemptions? We show that during tranquil market conditions, these funds tend to reduce liquid asset holdings to meet redemptions, temporarily increasing relative exposures to illiquid asset classes. When aggregate uncertainty rises, however, they tend to scale down their liquid and illiquid assets proportionally to preserve portfolio liquidity. This fund-level dynamic management of liquidity appears to affect the broad financial market: Redemptions from the corporate bond fund sector lead to more corporate bond selling during high-uncertainty periods, which generates price pressures and predicts strong return reversals.

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Does Enhanced Disclosure Really Reduce Agency Costs? Evidence from the Diversion of Corporate Resources

The Accounting Review ◽

10.2308/accr-10160 ◽

2011 ◽

Vol 87 (1) ◽

pp. 199-229 ◽

Cited By ~ 58

Author(s):

Pinghsun Huang ◽

Yan Zhang

Keyword(s):

Capital Markets ◽

Agency Costs ◽

Capital Investment ◽

Data Availability ◽

Disciplinary Power ◽

Liquid Asset ◽

Internal Capital ◽

Corporate Resources ◽

Cash Reserves ◽

Liquid Asset Holdings

ABSTRACT This study investigates whether extensive disclosure reduces managerial expropriation of corporate resources by examining the potential effects of enhanced reporting on the values of cash assets and investment ventures, respectively. We uncover evidence that liquid asset holdings are valued at a discount by firms with fewer disclosure practices than their more transparent counterparts. Moreover, disclosure activity substantially improves the value of cash assets in excess of requirements for operations and investment. These findings suggest that detailed reporting facilitates the scrutiny and discipline of capital markets, thus preventing the diversion of cash reserves. In further support of the disciplinary power of greater disclosure, we find that value-destroying projects, through internal capital investment and external acquisitions, are concentrated in firms adopting opaque disclosure policies. Collectively, our results support the premise that extensive disclosure impairs insiders' abilities to utilize corporate resources in a self-serving manner. Data Availability: Data are available from public sources indicated in the text..

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A Dynamic Systems Approach to Personality

European Psychologist ◽

10.1027//1016-9040.6.3.172 ◽

2001 ◽

Vol 6 (3) ◽

pp. 172-176 ◽

Cited By ~ 14

Author(s):

Lawrence A. Pervin

Keyword(s):

Dynamic Systems ◽

Systems Approach ◽

Biological Processes ◽

Recent Advances ◽

Dynamic View ◽

The Future ◽

History Of

David Magnusson has been the most articulate spokesperson for a holistic, systems approach to personality. This paper considers three concepts relevant to a dynamic systems approach to personality: dynamics, systems, and levels. Some of the history of a dynamic view is traced, leading to an emphasis on the need for stressing the interplay among goals. Concepts such as multidetermination, equipotentiality, and equifinality are shown to be important aspects of a systems approach. Finally, attention is drawn to the question of levels of description, analysis, and explanation in a theory of personality. The importance of the issue is emphasized in relation to recent advances in our understanding of biological processes. Integrating such advances into a theory of personality while avoiding the danger of reductionism is a challenge for the future.

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