This course examines securities and securities markets with emphasis on stocks and bonds. Topics include information, interest rates, risk-return relationships, efficient markets, diversification, portfolio performance measurement, and the application of financial theory to investment decisions. Prerequisite: FIN 301 and MGTSC 312. Students may not receive credit for both FIN 412 and ECON 442.Fall Term 2021
We examine whether variation in bank concentration helps explain variation in deposit account prices such as interest rates, maintenance fees, and fee thresholds. The standard measure of concentration, the HHI, is not correlated with any of the outcome variables. A generalized HHI (GHHI) that captures both common ownership and cross-ownership is strongly correlated with higher maintenance fees, fee thresholds, and deposit rate spreads. We use the growth of index funds as a source of variation to suggest a causal link from GHHI to higher prices for banking products.
Female-led firms do not perform as well as male-led firms when financed by venture capital (VC). Does interaction with venture capitalists contribute to this gender gap in performance? I find a large performance gender gap among firms financed by syndicates with only male GPs but no such gap among firms financed by syndicates that include female GPs. The disparity is solely due to improved performance among female-led firms. This suggests that VC gender composition has contributed strongly to the performance gap between female- and male-led firms.