Discussion of “Value investing in credit markets”

Discussion of “Value investing in credit markets” Rev Account Stud (2012) 17:610–611 DOI 10.1007/s11142-012-9198-3 Itzhak Venezia Published online: 12 July 2012 Springer Science+Business Media, LLC 2012 This discussion starts by describing what I like about the paper, then it expounds on the ‘‘big picture’’ lessons I have drawn from it, and concludes with thoughts about where this research may lead us. This paper spans many areas—options theory, bankruptcy predictions, efficient markets, and investment theory—and sheds light on all of them. The paper integrates accounting variables and options theory to arrive at superior bankruptcies predictions, and then uses these predictions to test the efficiency of credit markets. The paper makes several important contributions. It provides new methods for bankruptcy predictions, it demonstrates the usefulness of credit spreads in these predictions, it explores the efficiency of credit markets, and it confirms the usefulness of accounting information in investments in credit markets. The paper’s main point is that credit markets are inefficient and that apparently investors fail to take full advantage of the information inherent in credit spreads. The authors present several estimates of credit spreads that can predict future credit spreads, thus opening the potential for above normal profits. While not all the estimates of credit spreads the http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Review of Accounting Studies Springer Journals

Discussion of “Value investing in credit markets”

Loading next page...
 
/lp/springer_journal/discussion-of-value-investing-in-credit-markets-MQpi9q0rOV
Publisher
Springer US
Copyright
Copyright © 2012 by Springer Science+Business Media, LLC
Subject
Business and Management; Accounting/Auditing; Corporate Finance; Public Finance
ISSN
1380-6653
eISSN
1573-7136
D.O.I.
10.1007/s11142-012-9198-3
Publisher site
See Article on Publisher Site

Abstract

Rev Account Stud (2012) 17:610–611 DOI 10.1007/s11142-012-9198-3 Itzhak Venezia Published online: 12 July 2012 Springer Science+Business Media, LLC 2012 This discussion starts by describing what I like about the paper, then it expounds on the ‘‘big picture’’ lessons I have drawn from it, and concludes with thoughts about where this research may lead us. This paper spans many areas—options theory, bankruptcy predictions, efficient markets, and investment theory—and sheds light on all of them. The paper integrates accounting variables and options theory to arrive at superior bankruptcies predictions, and then uses these predictions to test the efficiency of credit markets. The paper makes several important contributions. It provides new methods for bankruptcy predictions, it demonstrates the usefulness of credit spreads in these predictions, it explores the efficiency of credit markets, and it confirms the usefulness of accounting information in investments in credit markets. The paper’s main point is that credit markets are inefficient and that apparently investors fail to take full advantage of the information inherent in credit spreads. The authors present several estimates of credit spreads that can predict future credit spreads, thus opening the potential for above normal profits. While not all the estimates of credit spreads the

Journal

Review of Accounting StudiesSpringer Journals

Published: Jul 12, 2012

There are no references for this article.

You’re reading a free preview. Subscribe to read the entire article.


DeepDyve is your
personal research library

It’s your single place to instantly
discover and read the research
that matters to you.

Enjoy affordable access to
over 18 million articles from more than
15,000 peer-reviewed journals.

All for just $49/month

Explore the DeepDyve Library

Search

Query the DeepDyve database, plus search all of PubMed and Google Scholar seamlessly

Organize

Save any article or search result from DeepDyve, PubMed, and Google Scholar... all in one place.

Access

Get unlimited, online access to over 18 million full-text articles from more than 15,000 scientific journals.

Your journals are on DeepDyve

Read from thousands of the leading scholarly journals from SpringerNature, Elsevier, Wiley-Blackwell, Oxford University Press and more.

All the latest content is available, no embargo periods.

See the journals in your area

DeepDyve

Freelancer

DeepDyve

Pro

Price

FREE

$49/month
$360/year

Save searches from
Google Scholar,
PubMed

Create lists to
organize your research

Export lists, citations

Read DeepDyve articles

Abstract access only

Unlimited access to over
18 million full-text articles

Print

20 pages / month

PDF Discount

20% off