No arbitrage and valuation in markets with realistic transactions costs

Article Abstract:

An analysis of transactions costs in finance is presented. The analysis extends earlier research findings of arbitrage absence in the presence of a pricing operator in markets without transactions cost. Realistic transactions costs areintroduced for the study. It is shown that a relationship between equilibrium prices in cost-free markets and realistic transactions costs may be established.

Research, Analysis, Financial markets, Cost (Economics), Costs (Economics)

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Eventually, something has to give, right? U.S. investment magnetism slips

Article Abstract:

Real policy rates are no longer as stimulative as before and the U.S. dollar's decline has contributed to emerging central banks' reserve accumulation, boosting global liquidity. The behavior of central banks regarding resource utilization rates and related market concerns are discussed.

United States, Economic aspects, Central banks, Volatility (Finance)

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The Role of Cash Balances in Firm Valuation

Article Abstract:

Working capital management is critical for financial managers. A valuation model is developed to show how cash balances affect the market value of the firm. The Capital Asset Pricing Model (CAPM) is modified to account for cash. Too little cash adds to the firm's risk.

Management, Working capital

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