Browsing by Author "Hobson, Jane"

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    The determinants of corporate risk management
    (1997) Dunley-Owen, Tracy; Hobson, Jane
    Traditional financial theory which is based on the Modigliani-Miller indifference paradigm, suggests that a firm's financial policies, of which risk management is one component, are irrelevant. However, this conclusion is seemingly contradicted by the observation of widespread use of derivatives by companies, particularly for hedging purposes. This apparent conflict is receiving attention from international financial researchers. A number of hypothesis have been proposed to explain corporate risk management. To evaluate the strength of these theories, this paper begins with a formalised process of identifying the assumptions underlying the hypotheses. The theories are classified according to which assumptions are relaxed. A limited number of international empirical studies have been performed to date. The results have been varied; four of the important studies are discussed. For the first time, an empirical investigation into the determinants of corporate risk management in South Africa is conducted. The most significant findings are that larger firms are more inclined to undertake risk management, and the likelihood of a firm hedging increases with the size of the director's ownership in the company.
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    The weekend effect on the Johannesburg stock exchange
    (1994) Nash, Peter; Hobson, Jane
    The study of intraweek share return patterns has received considerable attention in the field of international research. This research has shown that share returns tend to be higher than average on the last trading day of the week and lower than average on the first. This anomaly has come to be known as the Weekend Effect. Explanations proffered for this phenomenon have failed adequately to justify the pattern of returns across the weekdays. These explanations include settlement period delays, dividend effects, measurement error in share prices, institutional features and the tendency for firms to release unfavourable information over the weekend. This study investigates day of the week effects on returns of the All Share Index, Industrial Index and Gold Index on the Johannesburg Stock Exchange.