Why are corporations terminated? A century of evidence from the Netherlands
Business History, 2025

Christopher L. Colvin , Abe de Jong, Philip T. Fliers and Florian Madertoner We identify all 196 Dutch exchange-listed corporations that halted their operations and ceased to exist between 1903 and 1996. We then explain these terminations using unique hand-collected accounting and gov ernance data and regression techniques suited to long-run comparative analysis. Although Dutch bankruptcy laws remained unchanged across the twentieth century, patterns of corporate exit shifted markedly: shareholder-induced voluntary liquidations predominated before WWII, while creditor-driven bankruptcies became the norm thereafter. Our analyses suggest this transformation reflected a broader redefinition of corporate purpose, from a liberal shareholder-centric model before WWII, to a stakeholder-focused paradigm that emerged among Dutch business leaders in the post-war period. We further find that the Dutch government’s industrial policy initiatives in the 1970s did not succeed in reducing corporate failures. Our findings underscore how shifts in corporate purpose can fundamentally reshape business outcomes, even in the absence of formal legal changes.

Optimizing Currency Factors
Financial Review, 2025

Minyou Fan, Fearghal Kearney, Youwei Li, Jiadong Liu We introduce a novel framework that dynamically optimizes currency factor strategies via trading currency spot and forward. We examine the performance of 24,336 portfolio optimization approaches and find that the optimized currency factors significantly outperform the naïve factors after correcting for data snooping bias. Our framework suits both symmetric factor portfolios, including carry, momentum, and value, and asymmetric factor portfolios, such as time series momentum and return signal momentum. An out-of-sample procedure that aggregates all the outperforming optimization approaches validates the economicsignificance of our optimized factor portfolio.

On the origin of green finance policies
Journal of Financial Stability, 2025

T.F. Cojoianu, D. French, A.G.F. Hoepner, L. Sheenan Despite the rising number of green finance policies, the socioeconomic determinants shaping them remain largely unexamined. Drawing from the literature analysing the relationship between regulation, market development and institutional economics, we contend that green finance policy adoption is driven by both market based and institutional factors. Using a survival analysis approach to understand the levers influencing green finance policy adoption across 188 countries from 2000 to 2019, we find that exposure to the fossil fuel industry predominantly drives the initial issuance of green finance policies. The positive effect of fossil fuel commercial financing on the adoption of green finance policies exists in countries with high and medium climate change awareness levels. Meanwhile, in countries with a low climate change awareness level, fossil fuel government subsidies drive green finance policy adoption. Our study also highlights the role of the financial industry as one of the key actors in the policy cycle of green finance policies via two pathways: (i) affecting financial stability through financing oil and gas companies on primary financial markets and (ii) developing a market for sustainable finance products.

The Term Structure of Credit Default Swap Spreads and the Cross Section of Options Returns
Journal of Futures Markets, 2025

Hao Zhang, Yukun Shi, Dun Han, Pei Liu, Yaofei Xu This paper, using the natural logarithmic form credit default swap (log CDS) slope, examines the variation in cross‐sectional 1‐month ATM delta‐hedged straddle returns. Our analysis reveals that the log CDS slope significantly and positively predicts these returns, even when accounting for several key volatility mispricing factors. Further investigation shows that this pre dictive relationship exhibits a strong time‐varying pattern, closely linked to market conditions. In contrast, the relationship between notable volatility mispricing factors and straddle returns remains relatively stable over time. Constructing a long‐short quintile portfolio on straddle options confirms that trading performance improves when the past 12‐month market return is at a historically lower level, market volatility is at a historically higher level, and the VIX is elevated. Log CDS slope, as a proxy for excess jump risk premium, significantly predicts delta‐hedged option returns during periods of high volatility.

Understanding the Performance of Currency Basis‐Momentum
European Financial Management, 2025

Minyou Fan, Xing Han, Ang Li, Jiadong Liu We conduct an in‐depth analysis of basis momentum (BM) in currency markets and examine its relationship with key market anomalies. We find that BM strategies generate significant excess returns across various formation periods. These abnormal returns are not fully explained by the closely related carry and momentum factors. By decomposing the BM signal, we show that both carry‐ and momentum‐related components contribute to the returns of BM strategies. Compared to carry trade, BM strategies exhibit significantly lower risk, leading to superior risk‐adjusted performance.

A pecking order of household finance
Oxford Economic Papers, 2025

Declan French How do households cope with economic shocks? In this article, I provide empirical evidence and theoretical grounding for a pecking order of coping methods using data from the UK Understanding Society COVID-19 Study. I find that there is a typical household finance ordering of responses to income loss. Almost two-thirds (65 per cent) of households first reduce spending then these households typically proceed to draw down savings (59 per cent) and their most common next response is relying on family and friends (21 per cent). Deviations from this ordering occur because certain coping methods are of ten unavailable—those households not reducing spending are already struggling and those without savings have nothing to drawdown. Receiving financial assistance from family and friends is also more common than some authors suggest. Lastly, I find that the costs of informal borrowing are influenced by plausible social factors. My results are informative for policies to promote resilience during crises.

Liquidity and Price Informativeness of Options: Evidence From Extended Trading Hours
Journal of Futures Markets, 2025

Liangyi Mu, Arie E. Gozluklu This paper explores the trading dynamics of the options market during extended trading hours (ETHs). During ETH, the options market is characterized by low liquidity and decreased trading activities, yet there is an increased likelihood of informed trading. The introduction of ETH improves overall market liquidity on the following trading day, as reflected by a reduction in the quoted and effective bid–ask spreads, for both index options and their underlying constituents. The improvement of liquidity is due to the timely incorporation of overnight news into option prices during ETH. Moreover, option prices during ETH are informative for the index level and realized volatility in the subsequent regular trading hours.

Who Wins and Loses in a Bubble? Evidence from the British Bicycle Mania
Journal of Economic History, 2025

William Quinn and John D. Turner How do different types of investors perform during financial bubbles? Using a rich archival source, we explore investor performance during the British bicycle mania of the 1890s. We find that directors and employees of cycle companies reduced their holdings substantially during the crash. Those holding shares after the crash were generally not from groups stereotypically thought of as naïve, but gentlemen living near a stock exchange, who had sufficient time, money, and opportunity to engage in speculation. Our findings suggest that the investors most at risk of losing during a bubble are those prone to familiarity and overconfidence biases.

Do global COVOL and geopolitical risks affect clean energy prices? Evidence from explainable artificial intelligence models
Energy Economics, 2025

Sami Ben Jabeur, Yassine Bakkar, Oguzhan Cepni We investigate the impact of global common volatility and geopolitical risks on clean energy prices. Our study utilizes daily data from January 1, 2001, to March 18, 2024. Using a new framework based on explainable artificial intelligence (XAI) methods, our findings demonstrate that the COVOL index outperforms the geopolitical risk index in accurately predicting clean energy prices. Furthermore, the Extreme Trees algorithm shows superior performance compared to traditional regression techniques. Our findings indicate that XAI improves transparency, thereby making a substantial contribution to agile decision-making in predicting clean energy prices. Practitioners, including investors and portfolio managers, can enhance investment decisions and manage systemic risks by incorporating COVOL into their risk assessment and asset allocation models.