Can supervise: YES
Bird, R, Foster, FD, Gray, J, Raftery, AM, Thorp, S & Yeung, D 2018, 'Who starts a self-managed superannuation fund and why?', Australian Journal of Management, vol. 43, no. 3, pp. 373-403.View/Download from: UTS OPUS or Publisher's site
© 2018, The Author(s) 2018. Self-managed superannuation funds (SMSFs) – small retirement savings funds with four or fewer members – now manage almost one-third of retirement savings in Australia, and serve over 1 million members. The number of SMSFs has increased to more than half a million in two decades, yet little is known about the reasons people start the funds and how they operate. We use a survey of more than 500 SMSF members and 500 large superannuation fund members to analyse why SMSF members commence and manage their own fund, compared to similar people who stay with a large fund. We find that control over investments and tax minimisation are the most common reasons for starting a SMSF, while satisfaction with large funds and unwillingness to take on the administrative burden of self-management are the most common reasons for not doing so. SMSF members do not show any greater financial skills than non-members, but they do display overconfidence, a higher risk tolerance and a more trusting attitude to financial professionals. Model results show that the majority of SMSF members start their funds at the suggestion of financial professionals. We also show that those who say they are thinking about starting a SMSF are different in significant ways from the eventual SMSF members, further evidence of the influence of the advice industry.
Bird, R, Gao, X & Yeung, D 2017, 'Time-series and cross-sectional momentum strategies under alternative implementation strategies', Australian Journal of Management, vol. 42, no. 2, pp. 230-251.View/Download from: UTS OPUS or Publisher's site
Nikitopoulos Sklibosios, C, Squires, M, Thorp, S & Yeung, D 2017, 'Determinants of the crude oil futures curve: Inventory, consumption and volatility', Journal of Banking and Finance, vol. 84, pp. 53-67.View/Download from: UTS OPUS or Publisher's site
Bird, R, Pellizzari, P & Yeung, DC 2015, 'Performance implications of active management of institutional mutual funds', Accounting and Finance, vol. 55, no. 1, pp. 1-27.View/Download from: Publisher's site
Bird, R, Choi, D & Yeung, DC 2014, 'Market uncertainty, market sentiment, and the post-earnings announcement drift', Review of Quantitative Finance and Accounting, vol. 43, no. 1, pp. 45-73.View/Download from: Publisher's site
Post-earnings announcement drift (PEAD) which was first identified over
40 years ago seems to be as much alive today as it ever was. Numerous attempts have been
made to explain its continued existence. In this paper we provide evidence to support a new
explanation: that the PEAD is a reflection of the level of market uncertainty and sentiment
that prevails during the post-announcement period. The overriding conclusion from our
analysis is that both uncertainty and sentiment play a central role in determining investor
behaviour and it is this behaviour that ultimately determines the pricing that is observed in
Bird, R, Reddy, K & Yeung, DC 2014, 'The relationship between uncertainty and the market reaction to information: Is it influenced by stock-specific characteristics?', International Journal of Behavioural Accounting and Finance, vol. 4, no. 2, pp. 113-132.View/Download from: UTS OPUS
Bird, R, Grosse, M & Yeung, DC 2013, 'The market response to exploration, resource and reserve announcements by mining companies: Australian data', Australian Journal of Management, vol. 38, no. 2, pp. 311-331.View/Download from: UTS OPUS or Publisher's site
This is the first paper to study the market response to Joint Ore Reserve Committee compliant announcements made by Australian mining firms. Results from an event study based on matched firms suggest that these announcements are highly value relevant, with the market reacting in a significantly positive way to both exploration and resource announcements. Larger abnormal returns are found to accrue to smaller firms, to firms that use positive adjectives in their announcement headlines and to firms whose announcements imply larger percentage increases in resource levels. We also find evidence of markets anticipating both exploration and resource announcements a few days before they are released, which may be suggestive of some insider trading.
Over any 12-month period, there is an enormous difference between the returns realised from investing in the best- and worst-performing stocks. We investigate the characteristics of these stocks and find that they share several features: extreme performers tend to be small companies that have volatile share prices and spend significant amounts of money on research and development. Accounting variables tend to be useful in separating out the best and worst performers; the latter also tend to be smaller companies which have lower share prices.
It has long been accepted that risk plays an important role in determining valuation where risk reflects that investors are unsure of future returns but are able to express their prior expectations by a probability distribution of these returns. Knight (1921) introduced the concept of uncertainty where investors possess incomplete knowledge about this distribution and so are unable to formulate priors over all possible outcomes. One common approach for making uncertainty tractable is to assume that investors faced with uncertainty will base their decisions on the worst case scenario (i.e. follow maxmin expected utility). As a consequence it is postulated that investors will become more pessimistic as uncertainty increases, upgrading bad news and downgrading good news. Using Australian data, we find evidence that investors react to bad news at times of high market uncertainty but largely ignore good news which is consistent with them taking on a pessimistic bias. However, we also find evidence of the reverse when market uncertainty is low with investors taking on an optimistic stance by ignoring bad news but reacting to good news. We also find that the impact that market uncertainty has on the reaction of investors to new information is modified by the prevailing market sentiment at the time of the announcement. Besides throwing light on the question of how uncertainty impacts on investor behaviour, our findings seriously challenge the common assumption made that investors consistently deal with uncertainty by applying maxmin expected utility.
Mar, JL, Bird, R, Casavecchia, L & Yeung, DC 2009, 'Fundamental indexation: An Australian investigation', Australian Journal of Management, vol. 34, no. 1, pp. 1-20.View/Download from: UTS OPUS or Publisher's site
Capitalisation-weighted indexes provide the basis for passive investment strategies designed to capture market performance. However, these cap-weighted indexes are claimed to be sub-optimal because of their tendency to overweight overvalued shares and underweight undervalued shares. U.S. evidence suggests that fundamental indexes, which select, rank and weight stocks according to fundamental measures of size such as book value and revenue, outperform cap-weighted indexes. This study examines fundamental indexation in an Australian context over the period 1995 to 2006 and finds support for the U.S. results. However, we also find that the superiority of fundamental indexation is largely explained by its inherent bias towards value stocks, which raises the question as to whether a more overt value tilt may not provide a superior means for exploiting mispricings in markets.
Nikitopoulos Sklibosios, C, Squires, M, Thorp, S & Yeung, DC 2014, 'The spread seesaw: How consumption, inventory and expected volatility affect the oik forward curve', Frontiers in Financial Econometrics, Brisbane, Australia.
Thorp, S, Bird, R, Gray, J, Liem, H, Raftery, A & Yeung, DC 2014, 'Why Self-Managed Superannuation Funds?', Paul Woolley Centre for the Study of Capital Market Dysfunctionality Annual Conference, Sydney, Australia.
Professor Ronald Geoffrey Bird, R, Pellizzari, P & Yeung, DC 2011, 'Performance implications of active management of institutional mutual funds', Annual Conference of the Multinational Finance Society, Rome, Italy.
Professor Ronald Geoffrey Bird, R, Choi, D & Yeung, DC 2011, 'Market uncertainty and sentiment, and the post-earnings announcement drift', Annual Conference of the Multinational Finance Society, Rome, Italy.
Professor Ronald Geoffrey Bird, R, Reddy, K & Yeung, DC 2011, 'The relationship between uncertainty and the market reaction to information: How is it influenced by market and stock-specific characteristics?"', Annual Conference of the Multinational Finance Society, Rome, Italy.
Bird, R, Choi, D & Yeung, DC 2011, 'Market uncertainty and sentiment, and the post-earnings announcement drift', 24th Australasian Finance and Banking Conference Proceedings, Australasian Finance and Banking Conference, University of NSW, Sydney, Australia, pp. 1-43.View/Download from: UTS OPUS
The post-earnings announcement drift (PEAD) first identified over 40 years ago seems to be as much alive today as it ever was. Numerous attempts have been made to explain its continued existence. In this paper we provide evidence to support a new explanation: that the PEAD is a reflection of the level of market uncertainty and sentiment that prevails during the post-announcement period. The finding that uncertainty plays a role in explaining how investors respond to information suggests that it should be included as a factor in pricing models while the fact that market sentiment also has a role is another instance of the importance of human behaviour in establishing prices
Professor Ronald Geoffrey Bird, R & Yeung, DC 2010, 'How do investors react under uncertainty?', Asian Finance Association International Conference 2010, Hong Kong.
Bird, R, Grosse, M & Yeung, DC 2010, 'The market response to exploration, resource and reserve announcements by mining companies: Australian findings', Proceedings of the European Financial Management Association 2010 Meetings, European Financial Management Association Conference, EFMA, Aarhus, Denmark, pp. 1-26.
This paper is the first to conduct an event study on the market response to exploration, resource and reserve announcements made by mining firms. Results from an event study using a matched firm approach suggest that markets react positively to both the exploration and the resource announcements at the time of their release but find no information value in the reserve announcements possibly because all of the information in these announcements has been anticipated by the market and/or contained in prior announcements.
Bird, R & Yeung, DC 2010, 'Institutional ownership and IPO performance: Australian evidence', Financial Management Association 2010 Meetings, Financial Management Association Annual Meeting, Financial Management Association, New York, USA, pp. 1-25.View/Download from: UTS OPUS
The duo IPO anomalies of underpricing and long run underperformance have inspired a plethora of studies. Yet few have examined the impact of majority investors in IPOs, namely institutional investors. Consistent with previous studies, we found large underpricing which was greatest in those issuers with the highest initial institutional ownership. Yet these issuers experienced the worst long]run underperformance which casts doubts over the informed]trading hypothesis. The findings are consistent with overreactions driven by informational cascade in the IPO market. High level of initial institutional interests generates informational herding that drives these issuersf prices beyond the fundamental. Over time, market correction leads to the long]run underperformance. Our results cast a somewhat different light on institutionsf role in IPOs, rather than being a valuable source of price discovery; Institutions may be a force of destabilization in what is already an event wrath with uncertainty.
Professor Ronald Geoffrey Bird, R 2009, 'How do investors react under uncertainty?', Paul Woolley Centre for Capital Market Dysfunctionality 2009 Annual Conference, Sydney, Australia.
Bird, R, Foster, D, Gray, J, Raftery, AM, Thorp, S & Yeung, D 2016, 'Experiences of Current and Former Members of Self-Managed Superannuation Funds'.