TY - JOUR T1 - The Effect on Stockholder Wealth of Product Recalls and Government Action: The Case of Toyota's Accelerator Pedal Recall JF - Quarterly Review of Economics and Finance Y1 - 2014 A1 - Gokhale,Jayendra A1 - Brooks,Raymond A1 - Tremblay,Victor J KW - Finance AB - We analyze the effect of Toyota’s faulty accelerator pedal on stockholder wealth. Using the event study methodology, we show that a major recall in January of 2010 caused the company’s cumulative abnormal returns to fall by 19 percent. Continued concerns that Toyota was unable to identify and adequately fix the problem induced the National Highway Traffic Safety Administration to conduct its own investigation in March, 2010. The results of this government investigation exonerated the company and caused Toyota’s cumulative abnormal returns to rise by almost 9 percent. The Toyota case provides an opportunity to study a product recall with both company error and a government action that addressed concerns about the safety of the product. VL - 54 CP - November 2014 U2 - a U4 - 87876405248 ID - 87876405248 ER - TY - JOUR T1 - What makes when-issued trading attractive to financial markets? JF - Financial Markets, Institutions and Instruments Y1 - 2014 A1 - Brooks,Raymond A1 - Kim,Yong H A1 - Yang,Jimmy KW - Finance AB - When-issued trading is the trading of securities prior to the actual issue of the security. When-issued trading is active around the world and in a variety of equity and bond markets. In this survey, we provide a general description of when-issued trading, analyze benefits and costs in various financial markets, present existing theoretical models and predictions, and synthesize empirical findings. We find that when-issued trading promotes price discovery, mitigates information asymmetry, provides convenience for trading ahead of the actual issue of the security, and in some markets reduces volatility. In addition, we offer policy implications and suggest directions for further research in this area. VL - 23 CP - 5 U2 - a U4 - 68819267584 ID - 68819267584 ER - TY - JOUR T1 - When-issued trading in the Indian IPO market JF - Journal of Financial Markets Y1 - 2014 A1 - Brooks,Raymond A1 - Mathew,Prem A1 - Yang,Jimmy KW - Finance VL - 19 U2 - a U4 - 53120905216 ID - 53120905216 ER - TY - JOUR T1 - Emerging from bankruptcy with when-issued trading JF - Financial Review Y1 - 2012 A1 - Brooks,Raymond A1 - Yang,Jimmy KW - Finance AB - We examine the set of firms that emerged from Chapter 11 bankruptcy and traded on a when-issued basis prior to their official return to the regular way in NASDAQ, Amex, or NYSE. We find that this when-issued market is liquid and price efficient. The when-issued closing price is a good indicator of the first closing price in the regular way market. Emerging firms that have when-issued trading experience lower regular way volatility and smaller relative spreads than those without when-issued trading. Our probit regressions show that firm size is an important determinant of the adoption of when-issued trading. VL - 47 U2 - a U4 - 8582115329 ID - 8582115329 ER - TY - HEAR T1 - Emerging from Bankruptcy with When-Issued Trading Y1 - 2008 A1 - Brooks,Raymond A1 - Yang,Jimmy KW - Finance JA - Financial Management Association annual meeting CY - Dallas U2 - c U4 - 11894759425 ID - 11894759425 ER - TY - JOUR T1 - Teaching an Old Dog New Tricks: Using the Dividend Growth Model in Financial Planning JF - Journal of Economics and Finance Education Y1 - 2007 A1 - Brooks,Raymond A1 - Yang,Jimmy KW - Finance AB - The Dividend Growth Model is a standard pedagogical tool in pricing stocks where the dividend grows at a constant rate. However, few dividend policies conform to this restrictive pattern and therefore the model is often quickly discarded in finance classes. The constant growth assumption of a cash flow stream fits well with other financial problems such as saving for a college education or contributions to a pension plan. This paper presents a couple of applications for the Dividend Growth Model plus an extension to the model and belies the adage: you can’t teach an old dog new tricks. VL - 6 CP - 2 U2 - a U4 - 2658555905 ID - 2658555905 ER - TY - JOUR T1 - The Interaction between Opening Call Auctions and Ongoing Trade: Evidence from the NYSE JF - Review of Financial Economics Y1 - 2004 A1 - Brooks,Raymond A1 - Moulton,Jonathan KW - Finance AB - We investigate the impact that the opening batch has on trading for the remainder of the day and what impact the prior day's trading has on the subsequent day's open. Traders have an interest in these trading impacts as their trades may cluster around opening and closing time periods. We find that the larger the volume in the opening batches, the greater the volume across the day. We also find the prior day's volume being positively related to the subsequent day's opening volume. Combined, these results suggest a continuing pattern of trade volume rolling from one day to the next. Additionally, we find that the spread in the continuous market can be partially attributed to the price change in the opening batch. We also find evidence of opening trade price reversals. Combined with the absence of price reversals following the opening trade, we conclude that the opening process may be more efficient at handling information than the continuous market. VL - 13 CP - 4 U2 - a U4 - 644730880 ID - 644730880 ER - TY - JOUR T1 - When-Issued Shares, Small Trades and the Variance of Returns around Stock Splits JF - Journal of Financial Research Y1 - 2004 A1 - Angel,James A1 - Brooks,Raymond A1 - Mathew,Prem KW - Finance AB - The increases in volatility after stock splits have long puzzled researchers. The usual suspects of discreteness and bid-ask spread do not provide a complete explanation. We provide new clues to solve this mystery by examining the trading of when-issued shares that are available before the split. When-issued trading permits noise traders to compete with a more homogenous set of traders, decreasing the volatility of the stock before the split. Following the split, these noise traders reunite in one market and volatility increases. Thus, the higher volatility after the ex date of a stock split is a function of the introduction of when-issued trading, the new lower price level after the split date, and the increased activity of small-volume traders around a stock split. VL - 27 CP - 3 U2 - a U4 - 644726784 ID - 644726784 ER - TY - JOUR T1 - How the Equity Market Responds to Unanticipated Events JF - Journal of Business Y1 - 2003 A1 - Brooks,Raymond A1 - Patel,Ajay A1 - Su,Tie KW - Finance AB - We examine the market reaction of prices, volume, spreads, and trading location when firms experience events that are totally unanticipated by the equity market in terms of both timing and content. We find that the response time is longer than previous studies have reported. Selling pressure, wider spreads, and higher volume remain significant for over an hour. We also find an immediate price reaction for overnight events; however, the market takes longer to react to events that occur when it is open. These findings may shed light on the efficacy of trading halts. VL - 76 CP - 1 U2 - a U4 - 644722688 ID - 644722688 ER - TY - HEAR T1 - Teaching an Old Dog New Tricks: Using the Dividend Growth Model in Financial Planning Problems Y1 - 2003 A1 - Brooks,Raymond KW - Finance JA - Annual Meeting of the Midwest Finance Association CY - St. Louis U2 - c U4 - 644737024 ID - 644737024 ER - TY - JOUR T1 - The Performance of Firms Before and After They Adopt Accounting-Based Performance Plans JF - Quarterly Review of Economics and Finance Y1 - 2001 A1 - Brooks,Raymond A1 - May,Don O. A1 - Mishra,Chandra KW - Finance AB - This paper examines the long-run performance of firms before and after