The pace of innovation in financial instruments has been enormous over the last two dec-ades, but only a few of them have survived. Several papers deal with the valuation of existing financialproducts. In contrast, our approach tries to explain the use of certain financial innovations by...

As in Breuer/Hartmann/Kleefisch (2003) this approach tries to explain the use of certainfinancial innovations by their fulfillment of different corporate financing functions. In contrast, wedissect equity instead of debt innovations. First, we identify numerous basic components of...

In this paper the relation between aggregate mutual fund flows and stock market returns isanalysed with respect to three issues. First, we study the relation between fund flows andlong-term realized returns (past, current and future). Second, we find out that fund flows arenot driven by...

The most relevant practical impediment to an application of the Markowitz portfolio selectionapproach is the problem of estimating return moments, in particular return expectations. We analyzethe consequences of using return estimates implied by analysts’ dividend forecasts under the...

In the literature, implied rates of return are suggested as estimators for future expected oneperiodreturns because of their property not being prone to the discount rate effect. The discount rateeffect describes the problem that changes in expected future one-period returns lead to...