Momentum investment strategies, portfolio performance, and herding: a study of mutual fund behavior

Article Abstract:

The purchasing behavior of mutual funds was examined. This study sought to determine the extent to which mutual funds buy stocks based on their previous returns and their tendency to demonstrate herding behavior. Results show that majority bought stocks that were winners in the past although most did not systematically give up losers in the past. Mutual funds that purchased stocks that were past winners, known as momentum investors, performed better than others. Herding behavior, where funds simultaneously buy and sell the same stocks, was not found.

Mutual funds

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On strategic commitment: contracting versus investment

Article Abstract:

Specific investment is presented as an alternative commitment tool for contractual commitment. Concerned parties often make specific investments following contract completion. When a new seller with lower costs develops as an opportunity to efficiently breach the agreement, the original parties will not secure total surplus from such a breach. Establishment of a contractual commitment in the form of a penalty for breach has its effectiveness limited by renegotiation by both parties and court enforcement.

Breach of contract, Penalties, Contractual, Contractual penalties

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Vertical integration as a self-enforcing contractual arrangement

Article Abstract:

Vertical integration is analyzed as self-enforcing contracts to explain the economic incentives in vertical mergers. Non-free riding and competitive distributors are frequently motivated to conduct sales promotions preferred by manufacturers. The contractual remedy to this motivation is liable to combine both self-enforcement and legal enforcement methods. Such contractual arrangements can be facilitated by vertical integration.

Distribution Channels, Distribution of goods, Distribution (Commerce), Vertical integration

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