Financial Markets—The Response in Crisis Moments

A special issue of Journal of Risk and Financial Management (ISSN 1911-8074). This special issue belongs to the section "Financial Markets".

Deadline for manuscript submissions: closed (1 October 2022) | Viewed by 22515

Special Issue Editor

CEFAGE, IIFA, Universidade de Évora, Largo dos Colegiais 2, 7004-516 Évora, Portugal
Interests: econometrics; econophysics; financial markets; fuzzy models; data analysis
Special Issues, Collections and Topics in MDPI journals

Special Issue Information

Dear Colleagues,

Financial markets are one of the bases of globalization, and the main drivers of the global economy, financial growth, and technological advancement.

In this context, it is important to assess the impact of financial crises on the different types of financial markets and how they react and may constitute the platform for economic and financial recovery.

From the stock, derivatives, bonds, cryptocurrency markets, to the famous flight-to-quality, we want to know more about how these markets behave in times of crisis, how they interact, and how they can support the bet on recovery.

Market efficiency remains a current theme, as do speculation and information asymmetry. What influences the behavior of markets, and how they influence economics and societies are themes that continue to fascinate us. Is it possible to predict the behavior of a financial market in the long, medium, or short term, based on existing economic information? Do economic cycles dictate the behavior of markets? In this issue, we will try to get answers to these and other questions. In essence, the aim of this Special Issue is to understand, to explore, and to try to explain financial markets’ behavior in a crisis context and the respective response.

We invite researchers to contribute original research articles, in theory, practice, and applications on financial markets’ behavior. All submissions must contain original unpublished work not being considered for publication elsewhere.

Prof. Dr. Andreia Dionísio
Guest Editor

Manuscript Submission Information

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Submitted manuscripts should not have been published previously, nor be under consideration for publication elsewhere (except conference proceedings papers). All manuscripts are thoroughly refereed through a single-blind peer-review process. A guide for authors and other relevant information for submission of manuscripts is available on the Instructions for Authors page. Journal of Risk and Financial Management is an international peer-reviewed open access monthly journal published by MDPI.

Please visit the Instructions for Authors page before submitting a manuscript. The Article Processing Charge (APC) for publication in this open access journal is 1400 CHF (Swiss Francs). Submitted papers should be well formatted and use good English. Authors may use MDPI's English editing service prior to publication or during author revisions.

Keywords

  • financial markets
  • crisis
  • recovery
  • investors’ behavior
  • interaction

Published Papers (4 papers)

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Research

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11 pages, 1185 KiB  
Article
Zombie Firms during and after Crisis
by Ivana Blažková and Gabriela Chmelíková
J. Risk Financial Manag. 2022, 15(7), 301; https://0-doi-org.brum.beds.ac.uk/10.3390/jrfm15070301 - 08 Jul 2022
Cited by 2 | Viewed by 2324
Abstract
The phenomenon of zombie firms is gaining the attention of economists across different countries of the world; the increased interest is particularly evident after periods of economic crises. In our study, we focus on the development of zombie firms in the period before [...] Read more.
The phenomenon of zombie firms is gaining the attention of economists across different countries of the world; the increased interest is particularly evident after periods of economic crises. In our study, we focus on the development of zombie firms in the period before and after the 2008 crisis within two different economies, i.e., Germany and the Czech Republic, to provide insight into how different conditions and the overall economic context affect the fact that companies are more prone to becoming zombie firms. We implemented a difference-in-differences regression model to estimate the treatment effect by comparing the change (difference) in the differences in observed outcomes between these two countries. The data were obtained from two databases—the database Albertina by Bisnode a.s. providing financial statements of enterprises in the Czech Republic, and the database provided by Creditreform AG, which includes annual report data for a large sample of German companies. The dataset of German enterprises included 1,444,698 observations, i.e., 338,923 firms, and the dataset of Czech enterprises included 2,139,462 observations, i.e., 523,542 firms, both across the years 2000–2016, i.e., the data sample covered the period before and after the 2008 crisis. The different development of the share of zombie firms after the great financial crisis between Germany and the Czech Republic was proven as statistically significant. The findings confirm Germany is a country with a more stable economy and with a significantly lower risk of zombie firms’ persistence, while the Czech Republic is at the level of the European average in terms of zombie share. The results also suggest an influence of post-crisis monetary policy on companies and the possible link between low interest rates and a growing share of zombies. Full article
(This article belongs to the Special Issue Financial Markets—The Response in Crisis Moments)
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15 pages, 1398 KiB  
Article
Short-Term Impact of COVID-19 on Indian Stock Market
by Yashraj Varma, Renuka Venkataramani, Parthajit Kayal and Moinak Maiti
J. Risk Financial Manag. 2021, 14(11), 558; https://0-doi-org.brum.beds.ac.uk/10.3390/jrfm14110558 - 18 Nov 2021
Cited by 16 | Viewed by 10592
Abstract
The onset of the COVID-19 pandemic and lockdown announcements by governments have created uncertainty in business operations globally. For the first time, a health shock has impacted the stock markets forcefully. India, one of the major emerging markets, has witnessed a massive fall [...] Read more.
The onset of the COVID-19 pandemic and lockdown announcements by governments have created uncertainty in business operations globally. For the first time, a health shock has impacted the stock markets forcefully. India, one of the major emerging markets, has witnessed a massive fall of around 40% in its major stock indices’ value. Therefore, we examined the short-term impact of the pandemic on the Indian stock market’s major index (NIFTY50) and its constituent sectors. For our analysis, we used three different models (constant return model, market model, and market-adjusted model) of event study methodology. Our results are heterogeneous and largely depend on the sectors. All the sectors were impacted temporarily, yet the financial sector faced the worst. Sectors like pharma, consumer goods, and IT had positive or limited impacts. We discuss the potential explanations for the same. These results may be useful for investors in safeguarding equity portfolios from unforeseen shocks and making better investment decisions to avoid large, unexpected losses. Full article
(This article belongs to the Special Issue Financial Markets—The Response in Crisis Moments)
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21 pages, 1751 KiB  
Article
Stress Spillovers among Financial Markets: Evidence from Spain
by Julián Andrada-Félix, Adrian Fernandez-Perez and Simón Sosvilla-Rivero
J. Risk Financial Manag. 2021, 14(11), 527; https://0-doi-org.brum.beds.ac.uk/10.3390/jrfm14110527 - 05 Nov 2021
Cited by 2 | Viewed by 1720
Abstract
Using a unique database, this paper examines the interconnection among stress indicators of the Spanish financial markets during the period of January 1999 to April 2021, applying both the connectedness framework and the Time-Varying Parameter Vector Autoregressive connectedness approach. Our results suggest that [...] Read more.
Using a unique database, this paper examines the interconnection among stress indicators of the Spanish financial markets during the period of January 1999 to April 2021, applying both the connectedness framework and the Time-Varying Parameter Vector Autoregressive connectedness approach. Our results suggest that 15.67% of the total variance of forecast errors was explained by shocks across the six financial market stress indices examined, indicating that the remaining 84.33% of variation was due to idiosyncratic shocks. Nevertheless, we find that stress connectedness varies over time, with a surge during periods of increasing economic and financial instability, mainly driven by high levels of pandemic and economy policy uncertainty and real economy worsening. Financial intermediaries were the main generators of stress during three out of four recent major financial crises in Spain, while their role as stress transmitters to other markets has been reduced since the onset of the COVID-19 health crisis. Our results also indicate that the COVID-19 outbreak represents a relevant event in the transmission of stress among all market segments. Full article
(This article belongs to the Special Issue Financial Markets—The Response in Crisis Moments)
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Review

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24 pages, 1668 KiB  
Review
A Systematic and Critical Review on the Research Landscape of Finance in Vietnam from 2008 to 2020
by Manh-Tung Ho, Ngoc-Thang B. Le, Hung-Long D. Tran, Quoc-Hung Nguyen, Manh-Ha Pham, Minh-Hoang Ly, Manh-Toan Ho, Minh-Hoang Nguyen and Quan-Hoang Vuong
J. Risk Financial Manag. 2021, 14(5), 219; https://0-doi-org.brum.beds.ac.uk/10.3390/jrfm14050219 - 12 May 2021
Cited by 1 | Viewed by 7016
Abstract
This paper endeavors to understand the research landscape of finance research in Vietnam during the period 2008 to 2020 and predict the key defining future research directions. Using the comprehensive database of Vietnam’s international publications in social sciences and humanities, we extract a [...] Read more.
This paper endeavors to understand the research landscape of finance research in Vietnam during the period 2008 to 2020 and predict the key defining future research directions. Using the comprehensive database of Vietnam’s international publications in social sciences and humanities, we extract a dataset of 314 papers on finance topics in Vietnam from 2008 to 2020. Then, we apply a systematic approach to analyze four important themes: Structural issues, Banking system, Firm issues, and Financial psychology and behavior. Overall, there have been three noticeable trends within finance research in Vietnam: (1) assessment of financial policies or financial regulation, (2) deciphering the correlates of firms’ financial performances, and (3) opportunities and challenges in adopting innovations and ideas from foreign financial market systems. Our analysis identifies several fertile areas for future research, including financial market analysis in the post-COVID-19 eras, fintech, and green finance. Full article
(This article belongs to the Special Issue Financial Markets—The Response in Crisis Moments)
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