The Performance Of Hedge Fund Relatively In UK - Free Essay Example

Sample details Pages: 16 Words: 4728 Downloads: 3 Date added: 2017/06/26 Category Finance Essay Type Essay any type Did you like this example? 1.1-Introduction: Hedge funds are actively managed portfolios that hold positions in publicly traded securities. Gaurav S. Amin and Harry M. Don’t waste time! Our writers will create an original "The Performance Of Hedge Fund Relatively In UK" essay for you Create order Kat (2000) stated on their report that à ¢Ã¢â€š ¬Ã…“A hedge fund is typically defined as a pooled investment vehicle that is privately organized, administrated by professional investment managers, and not widely available to the publicà ¢Ã¢â€š ¬?. It charges both a performance fee and a management fee. It allows a flexible investment for a small number of large investors (usually the minimum investment is $1 million) can use high risk techniques. 1Now days it is very clear that in the matter of alternative investment mutual fund is not performing well. As a high absolute returns and typically have features such as hurdle rates and incentive fees with high watermark provision hedge fund gives a better align to the interests of managers and investors. 2Moreover mutual funds typically use a long-only buy-and-hold type strategy on standard asset classes, which help to capture risk premia associate with equity risk, interest rate risk, default risk etc. However, they are not very help ful in capturing risk premia associate with dynamic trading strategies. That is why hedge fund comes into the picture. In the year of 2009, this takes the greatest history of the world in the following century. In the year of 2008 the world saw the greatest fall down of the world economy. Lots of people missing their jobs, lots of company were stopped. The world economy faced the highest losses in the history. These all factors are showing only one way to makeover from that greatest downfall that is hedging. 3The last couple of decades have witnessed a rapidly growing in the hedge funds. Relative to traditional investment portfolios hedge funds exhibit some unique characteristics; they are flexible with respect to the types of securities they hold and the type of the position they take. 1 Agarwal, V. and Naik, N. (2000). à ¢Ã¢â€š ¬Ã…“Multi-period performance persistence analysis of hedge fund sà ¢Ã¢â€š ¬?. The journal of financial and quantitative analysis. Vol. 35, No,3. PP-327. 2 Agarwal, V. and Naik, N. (2004). à ¢Ã¢â€š ¬Ã…“Risks and portfolio decisions involving hedge fundsà ¢Ã¢â€š ¬?. The review of financial studies, Vol. 17, No.1. PP-64. 3 Journal of banking and finance 32(2008) 741-753- à ¢Ã¢â€š ¬Ã…“Hedge Fund Pricing and Model Uncertaintyà ¢Ã¢â€š ¬? by Spyridan D. Vrontos, Ioannis D. Vrontos, Daniel Giomouridies. Since the early 1990s, hedge funds have become an increasingly popular asset class. The amount invested globally in hedge funds rose from approximately $50 billion in 1990 to approximately $1 trillion by the end of 2004. And because these funds characteristically use stantial leverage, they play a far more important role in the global securities markets than the size of their net assets indicates. Moreover, investments in hedge funds have become an important part of the asset mix of institutions and ever wealthy individual investors (Malkiel, B. and Saha, A. (2005). 4The number of FOHFs increase by 40% between 2001 and 2003, and now comprised almost two third of the $650 billion invested in the USAà ¢Ã¢â€š ¬Ã¢â€ž ¢s hedge fund market. Due to its nature it is difficult to estimate the current size of hedge fund industry. 5Van Hedge Fund Advisors estimates that by the end of 1998 there were 5380 hedge fund managing $311 in capital, with between $800 billion and $1 trillion in total assets, which indicates the higher number of recent new entries. So far, hedge fund is based on American phenomena. About 90% hedge fund managers are based in the US, 9% in Europe and 1% in Asia and elsewhere. Now a dayà ¢Ã¢â€š ¬Ã¢â€ž ¢s around 5883 hedge funds are trading around the world. (*Barclay Hedge database). Chart 1: Assets of Hedge fund industry from 1997 to 2009. Source: https://www.barclayhedge.com/research/indices/ghs/mum/Hedge_Fund.html According to the Barclay hedge database the asset of hedge fund industry is $1205.6 billion dollar. 4 Fin ancial times, 29th October, 2003. www.vanhedge.com https://www.barclayhedge.com/products/hedge-fund-directory.html 1.2-Research questions: Specifically in this paper, I want to address two main questions. First one is what is the performance of hedge fund and FTSE100 over the period of 2001 to 2008? To evaluate the performance I use three traditional risk adjusted performance measurement model. To give a better idea and matter of easily understand I use the Sharp ratio, the Treynor ratio, and the Capital Asset Pricing Model (CAPM). However, the equity market index is not necessarily the right benchmark for hedge funds, therefore, market betas and abnormal returns may not be the appropriate measures for risks and profits. To mitigate this problem, I calculate sharp ratios, which are defined as the ratio of the average excess fund returns over the standard deviation. Second question is does hedge funds gives better return from UK equity market (FTSE100)? To make this comparison I use regression analysis where the correlation will show how the hedge funds act against the FTSE 100. 1.3-Objective of the study: The main objective of this study is to find out the performance of Hedge fund relatively with the UK equity market FTSE 100. In addition, I address in this paper four major hedge funds performance correlation with FTSE100. As a result an individual investor can easily understand which portfolio will give better return at their investment perspective. This study focuses on UK investorà ¢Ã¢â€š ¬Ã¢â€ž ¢s perspective only. In the past several years, lots of studies had been done on this area like Park and Staum (1998), Brown et al. (1999), Agarwal and Naik (2000), Herzberg and Mozes (2003), Capocci and Hubner (2004), and Malkiel and Saha (2005) analysis the hedge fund performance. Most of the statistical methodology is on the regression with equity markets and rest of all are in the cross product ratio. Above all they tried to find out the return of different types of hedge fund depending on the market risk and market return. So finally, the purpose of this paper is clearly esta blished, that is to understand hedge fund performance over the UK equity market (FTSE100). 1.5-Overview of the methodology: In this section I would like to describe an overview of my methodology. To find out the hedge fund performance and the FTSE100 marketà ¢Ã¢â€š ¬Ã¢â€ž ¢s performance I use three traditional risk-adjusted performance measurement models. First one is the Sharpe ratio, secondly, the Treynor ratio and finally, the Capital Asset Pricing Model (CAPM). I address the Sharpe ratio and the Treynor ratio because these two gives better easy view for an investor to evaluate the hedge fund performance by themselves. However, the Sharpe ratio and the Treyneo ratio measure the excess return of per unit of risk for an investment asset. These two are used to understand how well the return of an asset compensates the investor for the risk taken. When comparing two assets each with the expected return of fund against the same benchmark with risk free return, the asset with the higher Sharpe ratio gives more return for the same risk. As a result investor can easily understand where to invest. In this paper I use total 287 funds including different types of hedge funds like- Event driven (31), Hedge fund (54), Global macro (37) and Market neutral (165). As a benchmark I use FTSE100 and for the risk free rate I use UK 10 year Treasury bond. All data were collected from the DataStream which is run by Thomson Reuters the worldà ¢Ã¢â€š ¬Ã¢â€ž ¢s leading source of intelligent information for businesses and professionals (https://thomsonreuters.com/). 1.6-Definition of the key terms: Hedge fund: In the early study by Francis C.C. Koh, Winston T.H. Koh , David K.C. Lee, Kok Fai Phoon (2004) stated in their report that à ¢Ã¢â€š ¬Ã…“Hedge Funds are innovative investment structures that were first created more than 50 years ago by Alfred Winslow Jones. He established a fund with the following features: (a) He set up à ¢Ã¢â€š ¬Ã…“hedgesà ¢Ã¢â€š ¬? by investing in securities that he determined as undervalued and funding these positions partly by taking short positions in overvalued securities, creating a à ¢Ã¢â€š ¬Ã…“market neutralà ¢Ã¢â€š ¬? position; (b) He also designed an incentive fee compensation arrangement in which he was paid a percentage of the profits realized from his clientsà ¢Ã¢â€š ¬Ã¢â€ž ¢ assets; and (c) He invested his own investment capital in the fund, ensuring that his incentives and those of his investors were aligned and forming an investment à ¢Ã¢â€š ¬Ã…“partnershipà ¢Ã¢â€š ¬?. Most modern hedge funds possess the abo ve listed features, and are set up as limited partnerships with a lucrative incentive-fee structure. In most hedge funds, managers also often have a significant portion of their own capital invested in the partnerships. The term à ¢Ã¢â€š ¬Ã…“hedge fundà ¢Ã¢â€š ¬? has been generalized to describe investment strategies that range from the original à ¢Ã¢â€š ¬Ã…“market-neutralà ¢Ã¢â€š ¬? style of Jones to many other strategies and opportunistic situations, including global/macro investing.à ¢Ã¢â€š ¬? On the other report by Liang, B. (1999) stated on his report that there are two major types of hedge funds, one is inshore and another is offshore. Onshore funds are limited partnerships of no more than 500 investors. Offshore funds are limited liability corporations or partnerships established in the tax neutral jurisdictions that allow investors an opportunity to invest outside their own country and minimize their tax liabilities. Due to the large variety of hedge fund inve sting strategies, there is no standard method to classify hedge funds smartly. There are at least 8 major databases set up by data vendors and fund advisors. I follow the classification used by Eichengreen and Mathieson (1998), which relied on the MAR/Hedge database. Under this classification, there are 8 categories of hedge funds with 7 differentiated styles and a fund-of-funds category. For my paper I chose three different categories, which are as follows: (a) Event driven funds. These are funds that take positions on corporate events, such as taking an arbitraged position when companies are undergoing re-structuring or mergers. For example, hedge funds would purchase bank debt or high yield corporate bonds of companies undergoing re-organization (often referred to as distressed securities). Another event-driven strategy is merger arbitrage. These funds seize the opportunity to invest just after a takeover has been announced. They purchase the shares of the target companies and short the shares of the acquiring companies. (c) Global/Macro funds refer to funds that rely on macroeconomic analysis to take bets on major risk factors, such as currencies, interest rates, stock indices and commodities. Opportunistic trading manager that makes profits from changes in global economies typically based in major interest rate shifts. To make profits managers uses leverage and derivatives. (d) Market neutral funds refer to funds that bet on relative price movements utilizing strategies such as long-short equity, stock index arbitrage, convertible bond arbitrage and fixed income arbitrage. Long-short equity funds use the strategy of Jones by taking long positions in selective stocks and going short on other stocks to limit their exposure to the stock market. Stock index arbitrage funds trade on the spread between index futures contracts and the underlying basket of equities. Convertible bond arbitrage funds typically capitalize on the embedded option in these bon ds by purchasing them and shorting the equities. Fixed income arbitrage bet on the convergence of prices of bonds from the same issuer but with different maturities over time. This is the second largest grouping of hedge funds after the Global category. Source Eichengreen and Mathieson (1998). 2.1.2-Current scenario of hedge funds: Chapter two Literature review: 2.1-History of hedge fund Despite the increasing interest and recent development, few studies have been carried out on hedge funds comparing to other investment tools like mutual funds. à ¢Ã¢â€š ¬Ã…“An analysis of Hedge Fund performance 1984-2000à ¢Ã¢â€š ¬? by Capocci Daniel using one of the greatest hedge fund database ever used on his working paper (2796 individual funds including 801 dissolved), to investigate hedge funds performance using various asset-pricing models, including an extension from of Carhartà ¢Ã¢â€š ¬Ã¢â€ž ¢s (1997) model combined with Fama and French (1998), Agarwal and Naik (2000) models that take into account the fact that some hedge funds invest in emerging market bond. At the end they found that their model does a better job describing hedge funds behaviour. That appears particularly good for the Event Driven, Global Macro, US Opportunistic, Equity non-Hedge and Sector funds. Since the early 1990s, when around 2000 hedge funds were managing assets totalling capital of $60 bil lion, the subsequent growth in the number and asset base of hedge funds has never really been refuted. The industry only suffered from a relative slowdown in 1998, but since then has enjoyed a renewed vitality with an estimated total of 10,000funds managing more than a trillion US dollars by the end of 2006. The growing trend of the sector remained remarkably sustained during the stock market collapse that started in March 2000, when the NASDAQ composite Index reached an all-time high of 5,132 and finished three years later with a floor level of 1,253. In the meantime, the global met asset value (NAV) of hedge funds continued to grow at a steady rate of 10.6% (Van Hedge Funds Advisors International, 2002), contrasting with a decrease of 2.7% in the worldwide mutual fund industry ( Investment Company Institute, 2003). In 2001, Capocci and Hubner(2004) estimated that there were 6,000 hedge fund managing around $400 billion. In 2007, Capocci, Duquenne and Hubner (2007) estimated that t here were 10,000 hedge funds managing around $1 trillion. This is a growth of 11% in the number of funds and 26% in assets over six years (6PhD thesis paper by Daniel P.J. Capocci). Other studies from practitioners Hennessee (1994), and Oberuc (1994) also showed an evidence of superior performance in the case of hedge funds. Ackernann and Al. (1999) and Liang (1999) who compared the performance of hedge funds to mutual funds and several indices, found that hedge funds constantly obtained better performance than mutual funds. Their performance was not better than the performance of the market indices considered. They also indicated that the returns in hedge funds were more unstable than both the returns of mutual funds and those of market indices. According to Brown and Al. (1997) hedge funds showing good performance in the first part of the year reduce the volatility of their portfolio in the second half of the year (Capocci Daniel- An analysis of hedge fund performance 1984-2000 ). Taking all these results into account hedge funds seems a good investment tool. 6 PhD thesis paper by Daniel P.J. Capocci. Electronic copy available at: http//ssrn.com/abstract=1008319. 2.1.1-Facts and finding of development in hedge funds: As a result of flexible investment strategies, a better manager inventive alignment, sophisticated investors, and limited SEC regulations hedge funds have gained incredible popularity. In the report of Agarwal, V. and Naik, N. (2004) stated that à ¢Ã¢â€š ¬Ã…“it is well accepted that the world of financial securities is a multifactor world consisting of different risk factors, each associated with its own factor risk premium, and that no single investment strategy can span the entire risk factor space. Therefore investors wishing to earn risk premia associated with different risk factors need to employ different kinds of investment strategies. Sophisticated investors, like endowments and pension funds, seem to have recognized this fact as their portfolios consist of mutual funds as well as hedge funds.1 Mutual funds typically employ a long-only buy-and-hold-type strategy on standard asset classes, and help capture risk premia associated with equity risk, interest rate risk, defau lt risk, etc. However, they are not very helpful in capturing risk premia associated with dynamic trading strategies or spread-based strategies. This is where hedge funds come into the picture. Unlike mutual funds, hedge funds are not evaluated against a passive benchmark and therefore can follow more dynamic trading strategies. Moreover, they can take long as well as short positions in securities, and therefore can bet on capitalization spreads or value-growth spreads. As a result, hedge funds can offer exposure to risk factors that traditional long-only strategies cannotà ¢Ã¢â€š ¬?. However, investor can create exposure like hedge funds by trading on their own account, in practice they encounter many frictions due to incompleteness of markets like the publicly traded derivatives market and the financing market. Moreover, the derivatives market for standardized contracts has grown a great deal in recent years, still it is very costly for an investor to create a customized payof f on individual securities. The same is true for the financing market as well, where investors encounter difficulties shorting securities and obtaining leverage. These frictions make it difficult for investors to create hedge fund-like payoffs by trading on their own accounts. According to Koh, F., Koh,W,. Lee, D,. and Phoon, K. (2004) à ¢Ã¢â€š ¬Ã…“in 1990, the entire hedge fund industry was estimated at about US$20 billion. At of 2004, there are close to 7000 hedge funds worldwide, managing more than US$830 billion. Additionally, about US$200-300 billion is estimated to be in privately managed accounts. While high net worth individuals remain the main source of capital, hedge funds are becoming more popular among institutional and retail investors. Funds of hedge funds and other hedge fund-linked products are increasingly being marketed to the retail market. While hedge funds are well established in the United States and Europe, they have only begun to grow aggressively in As ia. According to Asia Hedge magazine, there are more than 300 hedge funds operating in Asia (including those in Japan and Australia), of which 30 were established in year 2000 and 20 in 2001. In 2003, 90 new hedge funds were started in Asia, compared with 66 in 2002, according to an estimate by the Bank of Bermuda. In 2004 more than US$15 billion, hedge fund investments in Asia are expected to grow rapidly. Several factors support this view. Asian hedge funds currently account for a tiny slice of the global hedge fund pie and a mere trickle of the total financial wealth of high net worth individuals in Asiaà ¢Ã¢â€š ¬?. Hedge funds have posted attractive returns. From 1987 to 2001, the Hennessee Hedge Fund Index posted annualised returns of 18%, higher than the SPà ¢Ã¢â€š ¬Ã¢â€ž ¢s 13.5%. Hedge funds are seen as a natural à ¢Ã¢â€š ¬Ã…“hedgeà ¢Ã¢â€š ¬? for controlling downside risk because they employ exotic investment strategies believed to generate returns that are uncorrel ated to traditional asset classes. Hedge funds vary in their strategies. So-called macro funds, such as Quantum Fund, generally take a directional view by betting on a particular bond market, say, or a currency movement. Other funds specialize in corporate events, such as mergers or bankruptcies, or simply look for pricing anomalies the stock markets. Hedge funds vary widely in both their investment strategies and the amount of financial leverage. (Koh, F., Koh,W,. Lee, D,. and Phoon, K. (2004) There are a number of factors behind the meteoric rise in demand for hedge funds. The unprecedented bull-run in the US equity markets during the 1990s expanded investment portfolios. This led an increased awareness on the need for diversification. The bursting of the technology and Internet bubbles, the string of corporate scandals that hit corporate America and the uncertainties in the US economy have led to a general decline in stock markets worldwide. This in turn provided fresh impetus for hedge funds as investors searched for absolute returns. (Koh, F., Koh,W,. Lee, D,. and Phoon, K. (2004) Unlike registered investment companies, hedge funds are not required to publicly disclose performance and holdings information that might be construed as solicitation materials. Since the early 1990s, there has been a growing interest in the use of hedge funds amongst both institutional and high net worth individuals. Due to their private nature, it is difficult to obtain adequate information about the operations of individual hedge funds and reliable summary statistics about the industry as a whole. (Koh, F., Koh,W,. Lee, D,. and Phoon, K. (2004) Hedge funds are known to be growing in size and diversity. As at the end of 1997, the MAR/Hedge database recorded more than 700 hedge fund managing assets of US$90 billion. This is only a partial picture of the industry, as many funds are not listed with MAR/Hedge. In practical terms, it is not easy to estimate the current siz e of the hedge fund industry unless all funds are regulated or obligated to register their operations with a common authority. Brooks and Kat (2001) estimated that, as at April 2001, there are around 6000 hedge funds with an estimated US $400 billion in capital under management and US $1 trillion in total assets. (Koh, F., Koh,W,. Lee, D,. and Phoon, K. (2004) According to Koh, F., Koh,W,. Lee, D,. and Phoon, K. (2004) à ¢Ã¢â€š ¬Ã…“three interesting features differentiate hedge funds from other forms of managed funds. Most hedge funds are small and organized around a few experienced investment professionals. In fact, more than half of U.S Hedge Funds manage amounts of less than US$25 million. Further, most hedge funds are leveraged. It is estimated that 70 per cent of hedge funds use leverage and about 18% borrowed more than one dollar for every dollar of capital. (See Eichengreen and Mathieson (1998). Another peculiar feature is the short life span of hedge funds. Hedge funds have an average life span of about 3.5 years (See Stefano Lavinio (2000) pp 128). Very few have a track record of more than 10 years. These features lead many to view hedge funds, as à ¢Ã¢â€š ¬Ã…“riskyà ¢Ã¢â€š ¬? and à ¢Ã¢â€š ¬Ã…“opportunisticà ¢Ã¢â€š ¬?. In the early study by Fung and Hsieh (2001), they use option like payoffs to view the risks of trend following hedge funds. They saw that the trend followers are typically commodity trading advisors (CTAs) who attempt to profit from trends in commodity prices using technical indicators. According to Fung and Hsieh (2001) trend followers are particularly interesting in that not only are their returns uncorrelated with the standard equity, bond, currency, and commodity indices, but their returns tend to exhibit option like features. They tend to be large and positive during the best and worst performing months of world equity indices. They cite evidence by Fung and Hsieh (1997) who show that if one divided up the states o f the world into five states based on the return on the MSCI equity world index, trend followers tend to outperform when the MSCI equity return is at its lowest and highest. The relationship between trend followers and the equity market is non-linear and U-shaped. Although returns of trend following funds have a low beta against equities on average, the state-dependent betas tend to be positive in up-markets and negative in down markets. As a result, Fung and Hsieh (2001) assume that the simplest trend following strategy has the same payout as a structured option known as the à ¢Ã¢â€š ¬Ã…“look back straddle.à ¢Ã¢â€š ¬? The owner of a look back call option has the right to buy the underlying asset at the lowest price over the life of the option. Similarly, a look back put option allows the owner to sell at the highest price. The combination of these two options is the look back straddle, which delivers the ex-post maximum payout of any trend following strategy. Fung and Hsieh (2001) then demonstrate empirically that look back straddle returns resemble the returns of trend following hedge funds. Building on this pioneer work, Fung and Hsieh (2004) propose seven factors that explain aggregate hedge fund returns. These seven factors include the excess return on the SP 500 index, the Wilshire small cap minus large cap index return, the term spread, the credit spread, and trend following factors for bonds, currencies, and commodities. They show that their seven factor model well explains variation in aggregate hedge fund returns. In addition, they find that equity long/short hedge funds tend to load positively on the SP 500 index factor and the small cap minus large cap factor. These results are consistent with the observation that equity long/short hedge funds typically have a small positive exposure to stocks and tend to be long small stocks and short large stocks. Fung and Hsieh (2004) also find that fixed income funds on the other hand tend to load neg atively on the change in the credit spread, where the credit spread is measured as the difference between the yield on Moodyà ¢Ã¢â€š ¬Ã¢â€ž ¢s Baa bonds and the yield on the 10-year constant maturity Treasury bond. The reason is that fixed income funds typically buy bonds with lower credit ratings and/or less liquidity and then hedge the interest rate risk by shorting US Treasury bonds, which have the highest credit rating and are more liquid. However, Agarwal and Naik (2004) also propose a multi-factor model to explain hedge fund risks. They find that non-linear option like payoffs are not restricted to trend followers and risk arbitrageurs, but are an integral feature of payoffs for a wide range of hedge fund strategies. In particular they observe that the payoffs on a large number of hedge fund strategies look like those from writing a put option on the equity index. These strategies include risk arbitrage, distressed debt, convertible arbitrage, and relative value arbitrage. Consistent with the exposure of these strategies to the risks borne by sellers of equity index put options, Agarwal and Naik (2004) find that these hedge funds suffer from significant left tail risk which tends to coincide with severe market downturns. The performance of hedge fund in 2008 was very shocking like more than ten years ago. Teo, M (2009) stated that in the month of August 1998 alone LTCM lost 45% of its capital in the wake of the massive liquidity event triggered by the Russian rubble default. Lots of academic literature has shown that the year 2007 and 2008 was the worst performance of hedge fund. As we know that hedge fund managers make portfolio by taking position in equity market and another fund, but unfortunately the world equity market goes downside. As a result investors who wish to weather future financial maelstroms should take note of the non-linear relationship between hedge fund returns and the equity market. 2.3-Limitations (previous) With respect to lightly regulated investment vehicles with great treading flexibility, hedge funds often pursue highly sophisticated investment strategies. Hedge funds promise absolute returns to their investor leading to a belief that they hold factor-neutral portfolios. With this in mind, hedge funds have some limitations. In the early studies many researchers discussed and explain that obstacles. First of all if we consider the measurement model of hedge funds performance, most of the researcher use traditional performance measure model like, Sharpe ratio, Treynor ratio and Jensen alpha which are not adequate for the performance evaluation of hedge funds. Fung and Hsieh (2000) and Roy (2003) stated that is incorrect to use these performance measures t evaluate the hedge funds strategies. Brooks and Kat (2002), Kat (2003), Mahdavi (2004) and Murguia and Umemoto (2004) also mentioned that the Sharpe ratio does not represent the true performance of hedge funds because it does no t take into consideration the asymmetry returns of these funds. As a result Perello (2007) propose to use the downside risk framework like Sortino ratio, the upside potential ratio and Omega measure as alternative performance measure. Moreover, Chung, Rosenberg and Tomeo (2004) and Scherer (2004) showed that Sortino ratio makes it possible to the investors to evaluate the risk and the performance of the hedge funds more sustainably than Sharpe ratio. Secondly, according to Ackermann et al. (1999) and to Fung and Hsieh (2000), two upward biases exist in the case of hedge funds. They do not exist in the case of mutual funds, and they both have an opposite impact to the survivorship bias. Survivorship bias is an important issue in hedge funds performance studies (see Carhart and al. 2000). This bias is present when a database contains only funds that have data for the whole period studies. In this case, there is a risk of overestimating the mean performance because the funds that wo uld have ceased to exist because of their bad performance would not be taken into account. The two upward biases exist because, since hedge funds are not allowed to advertise, they consider inclusion in a database primarily as a marketing tool. The first phenomenon stressed by Ackermann and al. (1999) and called the self-selection bias is present because funds that realize good performance have less incentive to report their performance to data providers in order to attract new investors. Malkiel, B. and Saha, A. (2005) stated in their report that à ¢Ã¢â€š ¬Ã…“Databases available at any point in time tend to reflect the returns earned by currently existing hedge funds but they do not include the returns from hedge funds that existed at some time in the past but are presently not in existence (i.e., the truly dead funds) or exist but no longer report their results (the defunct funds). Unsuccessful hedge funds have difficulties obtaining new assets. Hence, they tend to close, leavi ng only the more successful funds in the database. But some funds stop reporting not because they are unsuccessful but because they do not want to attract new investmentà ¢Ã¢â€š ¬?. The second point called instant history bias or backfilled bias (Fung and Hsieh 2000) occurs because after inclusion a fundà ¢Ã¢â€š ¬Ã¢â€ž ¢s performance history is backfilled. This may cause an upward bias because funds with less satisfactory performance history are less likely to apply for inclusion than funds with good performance history (Capocci Daniel 2001, An analysis of hedge fund performance 1984- 2000).

Comparing France and Us Criminal Justice System Essay

There many different criminal justice systems in the world today. Some that consists of many of the same policies and some that are considerably different. In the case of France and the U.S. there are a lot of similarities, but I will be focusing on the differences between each of their systems. The aspects that I will be comparing are police, courts, the legal profession, legal education, criminal procedural law, corrections, and juvenile justice and the advantages and disadvantages of each. The policing system in France is a lot different than the one in the U.S. In France there is one big centralized police system run by the government. Unlike the fragmented police model, which is found in the United States and is attributed to the†¦show more content†¦Another difference between the two countries is their court system. France does not practice judicial review. In the United States, the Supreme Court has the principle responsibility of ruling on the constitutionality of all laws. This kind of judicial review is not practiced in France (Terrill 232). In France they have the Constitutional council which has nine members serving a nine year term, they are responsible for election complaints and the legislation made in parliament. The advantage of this is that it reduces the conflict of jurisdictions. But the disadvantage is that our Supreme Court has a longer term than the Constitutional Council which allows more constant laws and fewer laws that will contradict e ach other. The aspect of legal profession and legal education is also extremely different. To become a judge in France you must first obtain a law degree from a university law school. Next you must gain admission to the National School for the Judiciary at Bordeaux (Terrill 236). After completing this school, the candidate is now qualified to become a judge. The French system allows judges to begin their profession at an early age which could be a disadvantage because of lack of experience in the system, where judges in the United States are usually older and more knowledgeable. The legal education is noticeably different from America. In France, students enter a universityShow MoreRelatedHigh Rate Of Violence Throughout The World1400 Words   |  6 PagesThis report will discuss the high rate of violence in prison systems throughout the world. The report will identify three legal standards and/or operational procedures that are emerging around the globe that govern correctional professional practices within corrections systems and could be applied to the South American prison system. The United States will be a point of reference to compare and differentiate with other countries on legal standards and operational producers. The report will also evaluateRead MoreThe Legal System Of The Law1559 Words   |  7 Pagesportions of the legal system. Laws are made in order to give us rules of conduct that protect everyone’s individual rights (Canada Department of Justice). How law is dealt with is seen to vary throughout different countries for the reason that each country contains different laws that are based to fit their culture and customs. However, when law is dealt with, regardless of the area it is enforced in; if the crime of the accused is serious enough it will go through a trial system which is also seenRead MoreCost Proposed By Mangalore And Knapp1191 Words   |  5 Pagesdirect and tangible costs incurred by schizophrenia would be from health services, social care, unemployment, tax forgone, premature mortality, unpaid care, institutional costs, private expenditures, criminal justice services and other public expenditures such as social security payment and security system. All these are shouldered by the society and public sector. Health services mainly comprise of hospitalisation, medication, psychiatric services; costs in social care mainly involve nursing and institutionalisationRead MoreNotes On Crime Rates And Juvenile Delinquency3087 Words   |  13 Pagesthat they want to terminate the problem completely and do not want to face the issue by offering help such as detention centers. If death penalties for juveniles did happen, he says that our country would look really bad compared to other countries. Justice Thurgood Marshall says,The question with which we must deal is not whether a substantial proportion of American citizens would today, if polled, opine that capital punishment is barbarously cruel, but whether they would find it to be so in lightRead MoreThe Sandy Hook Elementary Shooting2067 Words   |  9 Pages1994 to 6.9 in 2004. When comparing gun homicides annually, Japan has less than fifty, along with Germany/Italy/France who each have less than one hundred fifty, and Canada has less than tw o hundred. On the other hand, over ten thousand people are killed by firearms each year in this country which averages out to be more than thirty people being shot and killed each day. Gun violence impacts society in multiple ways from medical costs, costs of the criminal justice system, security precautions suchRead MoreEssay on Gathering the Facts at the Crime Scene3234 Words   |  13 Pagesin the reality solving homicides is not as one would see on their favorite police show. As mention previous, the intrigue with police shows on television make it difficult to found a jury that have not seen those type show. Therefore, the court system has a problem obtaining a guilty verdict because jurors wrongfully acquit guilty defendants when no scientific evidence has been presented, as they have seen on television. As Donald Shelton states in â€Å"the CSI Effect: Does It Exist† this so-calledRead MoreEssay on Black Panther Party2252 Words   |  10 Pagesradical militant ideals of Malcolm X and Che Guevara. From the doctrines of Maoism they saw the role of their Party as the frontline of the revolution and worked to establish a unified alliance, while from Marxism they addressed the capitalist economic system, and exemplified the need for all workers to forcefully take over means of production (Baggins, Brian). Mao was important to the Black Panthers because of his different stance on Marxism-Leninism when applied to Chinese peasants. The founders of theRead MoreUS Intelligence Sees Cyber Threats Eclipsing Terrorism: An Analysis6653 Words   |  27 PagesEclipsing Terrorism The issue of security is no longer an aspect that easily definable or that can be controlled through traditional means. During the Cold War era, security was defined in terms of the nuclear threat and that of global war in the bipolar system. Today, and especially after the 2001 terrorist attacks over the United States, the issue of terrorism has become rather debated and is seen as the main threat to security. Even so, recent events have placed yet another major threat on top of theRead MorePolice Efficiency and Effectiveness6591 Words   |  27 PagesASSESSMENT OF THE ORGANIZATIONAL EFFICIENCY AND EFFECTIVENESS OF LEON PNP THROUGH A COMPARATIVE STUDY OF CRIMINAL CASES SOLVED AND CLEARED AS OF YEAR 2009 TO 2013 An Undergraduate Research Paper Presented to: Mr. Hanibal E. Camua Division of Social Sciences University of the Philippines Visayas Miagao Campus, Iloilo In Partial Fulfillment of the Requirements In Political Science 14 Philippine Politics and Government By John Mark C. Calves Jonathan V. Magan Arielle Lois C. Robles Read MoreSocial Policy, Social Welfare, and the Welfare State11346 Words   |  46 Pagesmanagement of risk Social inclusion Social policy as administrative and ï ¬ nancial arrangements Social policy as social administration Social policy as public ï ¬ nance Social policy as outcomes Social welfare The welfare state Deï ¬ ning the welfare state Comparing types of welfare state The development of the welfare state A consequence of industrialization or of political competition? Conclusion: Has the ‘golden age’ of the welfare state passed? FURTHER READING USEFUL WEBSITES ESSAY QUESTIONS 8 8 8 10 12

Waze-Analytical Proposition Free Essays

Strategic Value of Information Technology – CRM / Analytics Waze- Analytics Proposition 1. waze currently gathers the following data on its clients: GPS data – where users are and when, the application learns the users driving routes in order to give them the best personalized route to their destination. 2. We will write a custom essay sample on Waze-Analytical Proposition or any similar topic only for you Order Now We propose to add new data regarding user’s personal characteristics and consumer preferences. Once the system detects that the user has stopped in a spot of interest – shopping center, gas station etc. a short questionnaire will pop up. This will include 2-4 questions regarding user characteristics and preferences relevant to specific place. In return to answering the questions user will receive points – user who gains a certain number of points will receive an e-coupon as an incentive to cooperate. For example – User stops at a specific shopping center and following questionnaire pops up: 1. Gender: Female / Male 2. Age group: 18-22 / 23-30 / 30-40 / 40-50 / over 50 3. What stores do you plan to shop at? A list of participating stores in the shopping center 4. A specific question regarding one of the stores chosen by user in Q3. The final lists of questions will, of course, be devised by our marketing specialists. 3. Together with current user data regarding – time and place the additional demographic data and consumer preferences collected provide businesses with a unique set of valuable marketing information. Waze can collect the information and sell it to different businesses which will analyze it for their specific need. An example of how this data can be useful: â€Å"Paz† and their â€Å"Yellow† convenience stores might decide to purchase consumer data from waze. Then they might find out that at a certain location between 2 to 4 PM a large amount of mothers of young children consistently stops at the competing â€Å"Delek† gas station across the street. Then â€Å"Paz† will decide to advertise via waze a diapers sale at â€Å"Yellow† at this location during these hours, thus attracting the mothers to fill their tanks at â€Å"Paz† and shop at â€Å"Yellow†. This way waze wins twice – first it gets paid for the data that they collect and then they get paid again for the focused advertising through their application. How to cite Waze-Analytical Proposition, Essay examples

Market Mechanism and Trading Company

Question: Describe how you will obtain the knowledge to undertake this project detailing your sources of research and expected timeframe. Answer: 1. Like any other sector, call centre industry also has evolved in a major way with the time. It has been assessed that technological evaluation has also influenced the organization to focus on the advanced technologies to handle any type of queries of the client in an appropriate way. As per the article by Upadhya and Vasavi (2012), call centres works as a bridge between the business firms and customers. It helps to resolve any kind of queries of the customers, which help business enterprises to maintain satisfaction at the desired level. For that reason, I have to utilize systematic procedure to gather knowledge to understand the process through which business procedures of the call centres has evolved. I will also focus on utilizing effective interview process among the employees to understand the kind of challenges they are facing with the outdated telephone system. I will also focus on utilizing qualitative face-to-face interview process to gather in-depth information about the research study. On the other hand, I will also like to conduct interview with the employees working in other call centres as well. I feel that that it will help me to understand the practical benefits of introducing advance technologies in an appropriate way. Furthermore, I will also have to focus on authentic secondary sources to gather knowledge about the advanced technologies used in the call centres (Schwartz, 2012). For instance, I will have to gather in-depth information about the technologies like Computer Telephony Integration, Automatic Call Distributor, Interactive Video, etc to understand the significance of utilizing advanced technologies. I feel that gathering in-depth information will allow me to execute changes in the current technologies in an appropriate way. Furthermore, I will also focus on capturing information about the time required for the initiation process of the advance technologies. For that reason, I will also talk with different technology expert to minimize the time req uired less than 2 week for implementing advance technologies in the working framework. 2. As per the article by Fotos and Browne (2013), effective implementation of new technologies in the operational process requires proper financial support. Otherwise, the entire transition process cannot be completed within a short span of time. Therefore, my first step will focus on ensuring proper financial backup from the management so that all the activities related to the change process can be initiated in an appropriate manner. For that reason, I will focus on estimating the total amount of expected cost that organization will have to invest for ensuring the new technologies in the operational process. After ensuring the financial section, I will focus on initiating the implementation process that creates minimum impact on the present operational process. Now, Venkatesh, Thong and Xu (2012) have highlighted the fact that utilization of advance technology creates maximum impact at the time when all the employees posses in-depth knowledge about the new technology. Therefore, I will suggest the management to provide proper training facilities to all the existing employees at the time of technological transition process, which will help to increase the quality of the existing provided services. Now, I will focus on the selecting specific individuals from the organization who required training most, as it will also help to increase the efficiency level of the operational process in a major way. For instance, effective utilization of new advanced technologies like Computer Technology Integration (CTI) and Automatic Call Distributor (ACD) requires in-depth knowledge from the employees (Clark et al., 2012). Otherwise, the prime objective of initiating new advanced technologies might not be fulfilled in an appropriate way. I will also focus on evaluating the exact number of instruments, which will be required for the transition process. I feel that purchasing of all the necessary instruments before the change process will help to complete the entire process within previously selected time period. In addition, I will also like to focus on selecting personnel with superior knowledge regarding the installation process of the advance technologies in call centre, which will help to fulfil all the requirements of the entire process within given timeframe. As per the article by Uhl (2012), collecting feedback from the employees is another important aspect of initiating new technologies in the operational process. It often helps to evaluate the necessary adjustment that organizations make to fulfil all the aims and objectives in an appropriate way. Thus, the implementation process of new technology will have to continue for certain timeframe so that employees do not have to face any type of challenges in future. As a result, it will eventually increase the effectiveness of the operational process of the call centre. References: Clark, C. M., Murfett, U. M., Rogers, P. S., Ang, S. (2012). Is empathy effective for customer service? Evidence from call center interactions.Journal of Business and Technical Communication, 1050651912468887. Fotos, S., Browne, C. M. (Eds.). (2013).New perspectives on CALL for second language classrooms. Routledge. Schwartz, R. A. (Ed.). (2012).The electronic call auction: Market mechanism and trading: Building a better stock market(Vol. 7). Springer Science Business Media. Uhl, D. M. A. (2012).Vision assessment: shaping technology in 21st century society: towards a repertoire for technology assessment(Vol. 4). J. Grin, A. Grunwald (Eds.). Springer Science Business Media. Upadhya, C., Vasavi, A. R. (Eds.). (2012).In an outpost of the global economy: Work and workers in India's information technology industry. Routledge. Venkatesh, V., Thong, J. Y., Xu, X. (2012). Consumer acceptance and use of information technology: extending the unified theory of acceptance and use of technology.MIS quarterly,36(1), 157-178.

What Is Speech, Language and Communication free essay sample

Explain each of the terms speech, language, communication, speech, language and communication needs. NYMPH (1 . 1) Communication A way of sending signal/information to other people. Includes body language, facial expressions, gesture and language Communication involves: Sending information (Verbally o non verbally) Receiving Information Interpretation Understanding information Communication refers to how we interact with others: ; Language Is used to represent concepts and thoughts ; Using language In different ways; to question, clarify, describe etc. Non-verbal rules of communication; good listening, looking at people Language Structured communication with a set of symbols that are spoken written or signed. Language refers to speaking and understanding language: ; Using words to build up sentences, sentences to build up conversations and longer stretches of spoken language ; understanding and making sense of what people say. Speech Vocalizes language Speech refers to: ; Saying sounds accurately and in the right places in words ; The sounds people use to communicate words ; Speaking fluently, without hesitating, or prolonging or repeating words or sounds ; Speaking with expression with a clear voice, using pitch, volume and Intonation to purport meaning. We will write a custom essay sample on What Is Speech, Language and Communication or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Speech, language and communication needs Children with speech, language and communication needs (SELL) find It difficult to communicate with others.Some children find it hard to understand what is said to them, form words and construct sentences, find the right words to express thoughts and feelings, and understand rules for social interaction and conversation. SELL can have a lasting effect on childrens lives. Studies of children with SELL have shown that children whose language difficulties are unresolved by the time they start school are more likely to have later academic, social and emotional difficulties associated tit their language difficulty.What Is Speech, Language and By utilizations Receiving information ; Language is used to represent concepts and thoughts ; Using language in different ways; to question, clarify, describe etc. ; Non-verbal ; Using words to build up sentences, sentences to build up conversations and longer stretches of spoken language.

Free Essays on Example Essay

Has someone ever scared the living hell out of you when you’re driving by almost running you off of the road? Well I hate to tell you but it’s probably someone just like me who is using a cell phone, eating, or even trying to read. People like me don’t even care about surrounding cars. For some reason it is easier to do things like eating in the car because it saves a lot of time, I guess. For example, every morning I’m in a rush because I wake up late, so the easiest thing to do is eat my breakfast in the car. I even notice others putting on makeup in the car which usually takes two hands, which should be on the wheel. Mirrors in the car are supposed to be used as looking at cars around you not yourself. People just think that it is alright to drive recklessly as long as they look nice or feed themselves. I think that this is a very serious issue and most accidents do happen because of this. Even after we see some horrible wrecks we just keep on doing what we have to do. On the news every once in a while I hear about cell phones and how dangerous it is to talk on them while driving, and yes it is dangerous, but what about the other things we do in cars that needs to be addressed to. Cell phones, although helpful to us when in an emergency, are used way to often in a car. When on a cell phone we have at least one hand free, but then I think about when I eat and I have no hands free and I use my knee to drive. Others and I need to start thinking of others when we do these things and put an end to it. Worst of all when these things happen at the same time; eating, people honking at us, and then a cell phone ringing , and trying to turn the radio down. These could all build up to a point of insane road rage. No wonder we are always getting into accidents. We try to blame it on the car, others, or the weather conditions, but in reality it is us not caring. The point is that we need to stop what were doing and focus on ... Free Essays on Example Essay Free Essays on Example Essay Has someone ever scared the living hell out of you when you’re driving by almost running you off of the road? Well I hate to tell you but it’s probably someone just like me who is using a cell phone, eating, or even trying to read. People like me don’t even care about surrounding cars. For some reason it is easier to do things like eating in the car because it saves a lot of time, I guess. For example, every morning I’m in a rush because I wake up late, so the easiest thing to do is eat my breakfast in the car. I even notice others putting on makeup in the car which usually takes two hands, which should be on the wheel. Mirrors in the car are supposed to be used as looking at cars around you not yourself. People just think that it is alright to drive recklessly as long as they look nice or feed themselves. I think that this is a very serious issue and most accidents do happen because of this. Even after we see some horrible wrecks we just keep on doing what we have to do. On the news every once in a while I hear about cell phones and how dangerous it is to talk on them while driving, and yes it is dangerous, but what about the other things we do in cars that needs to be addressed to. Cell phones, although helpful to us when in an emergency, are used way to often in a car. When on a cell phone we have at least one hand free, but then I think about when I eat and I have no hands free and I use my knee to drive. Others and I need to start thinking of others when we do these things and put an end to it. Worst of all when these things happen at the same time; eating, people honking at us, and then a cell phone ringing , and trying to turn the radio down. These could all build up to a point of insane road rage. No wonder we are always getting into accidents. We try to blame it on the car, others, or the weather conditions, but in reality it is us not caring. The point is that we need to stop what were doing and focus on ...

Managing people and organisations - Strategic human resource Essay

Managing people and organisations - Strategic human resource management - Essay Example On the other hand, outsourcing persists in the 21st century because it ensures that non-core functions of an organisation are carried out by external parties and this allows a business to focus on its core commitments (Morgan, 2008 p26). This means that in the conflict between human resource challenges and the role outsourcing will exist into the foreseeable future. This paper examines the elements, features and components of outsourcing in the context of human resource management. It analyses the unexpected costs and competitions that arises from outsourcing. It does examine the failures of outsourcing, challenges of outsourcing in relation to human resource strategy alignments as well as the tangible and intangible consequences of outsourcing. The paper will also touch on other aspects of human capital that is affected by outsourcing like the learning and development of employees in relation to innovation, job security matters as well as contractual issues and matters. 2.0 Alignmen t of HR Strategies and Patterns in Outsourcing Outsourcing intervenes in the overall strategy of an organisation as well as specific departments of organisations. Firms choose to outsource components of their operations because of some cost advantages and/or strategic benefits. The advantages that outsourcing brings to an organisation include; allowing staff to focus on their core areas, attainment of key strategic objectives, lowering and stabilising costs, responsiveness to market conditions and reductions in costs (Kleim, 1999: Quinn, 1999). In spite of these advantages, outsourcing comes with some inherent costs and obvious disadvantages which can affect the overall strategy of an organisation. This include over-dependence on outsiders, hidden costs and contract issues, loss of control and motivational/commitment issues on the part of employees from the external firm (Currie & Willcocks, 1997). The costs and benefits of outsourcing are quite enormous. Although some of them are o bvious, others are hidden. These dynamics have a strong and significant effect on the human resource strategy of an organisation. 2.1 Elements of HR Strategy Human Resource strategy is a component of corporate strategy. It involves three main elements: 1. Long term plans 2. It affects the whole organisation and 3. It involves top level managers (Tribus, 1987). This implies that human resource strategy is determined by senior management of an organisation like directors and other senior HR executives in the organisation. In the practical sense, HR strategy is the concern of the Human Resource Manager and it is determined by the wider views and strategies of the CEO and the Board of Directors. Additionally, the activities of some of the committees of the board of directors affect the components and operation of the human resource unit of a business. Secondly, HR strategy has long term implications. In other words it involves plans and policies that are created for a period of over 7 y ears. This include blueprints on how employee concerns must be identified and resolved. Furthermore, HR strategy affects the entire organisation. The strategic plans and objectives of the HR department are meant to determine the actions of different parts of the organisation including the various employees and management. Human resource management intervenes with organisational strategy,

Answer to legal problem questions Essay Example | Topics and Well Written Essays - 1250 words - 1

Answer to legal problem questions - Essay Example While in the case of Daniels V. Anderson6 involving similar facts, Daniels counter-sued by alleging that the Board failed to discharge their duty of care and diligence. The Court held that auditors and executive directors are liable in negligence since they had no mechanism in place allowing the directors to monitor the audit which contributed to failure to report the irregularities. Further, it ruled that the test for the breach of duty of care was objective. The court laid down mandatory duties for directors: to acquire basic standard of understanding of the company’s business; under a continuing obligation to keep informed of the company’s activities; undertake a â€Å"general monitoring† of the company’s affairs; and understand the financial status of the company. The case of ASIC V Rich7 affirmed the decision in Daniels8 line of cases regarding the required duty of care and skill among directors. While the case of Clark9 held that there is a â€Å"co re, irreducible requirement† of involvement among directors in the management of the corporation which prohibits â€Å"sleeping or passive directors†. Applying these cases, the suit filed by the auditor against DD, WW and SS shall prosper for failure to exercise the standard of care and diligence required under S180. Their negligence caused damage to NatureWorld for failure to monitor the financial condition of the company and to conduct a â€Å"general monitoring† of the company’s affairs. The Corporation should file a case against the auditor, DD, WW and SS, as executive directors for breaching the standard of care and diligence required under S180, which provides a civil liability provision, for the damage incurred by the corporation brought about by such breach. Facts/Issues: One of the employees of the company, Noi Dea was negligent while conducting a tour,

Virtue Ethics and Mattel's Case Essay Example | Topics and Well Written Essays - 1250 words

Virtue Ethics and Mattel's Case - Essay Example Truthfulness also means reporting regularly to the board of directors and top management, who at the beginning of GMP, were dedicated to realizing the virtues of their program. They wanted business ethics that had clear standards and measures, and Sethi et al. (2011) helped provide those necessities. The main concern with GMP is the clash between the truthfulness principle and actual reporting practices. After finding problems with one of Mexico’s Mattel plants, operational level managers greatly pressured MIMCO to change its draft report, and suggested that the council overreacted to â€Å"isolated instances† (Sethi et al., 2011, p. 497). MIMCO received a â€Å"list of changes in language† and were asked to include them in the draft report (Sethi et al., 2011, p. 497). This challenge shows the difference between operational managers’ and top management’s commitment to GMP. Apparently, commitment discrepancy exists between the top and operational ma nagers, which undermine the truthfulness of GMP. Courage is another virtue that does not depend sacrificing people’s lives, but on moral courage, where people are not afraid to know and to accept the truth, as well as to use the truth to do what is right (Harper, 2008, p. 197). Solomon (1993) argued that moral courage concerns a process of understanding the big picture, the mission and goals of the organization, and how the organization can attain the best intentions (p. 48). It refers to sticking to the best intentions, however difficult it might be. Being courageous can then be related to truthfulness, because the brave does not fear the truth. When Mattel asked Sethi to lead the...Justice is fundamental to Mattel because it affects GMP’s policies, procedures, and outcomes. Justice concerns being fair to others and responding to unjust policies, procedures, and outcomes. In business, justice refers to the rules and procedures that people use to attain justice, when m aking decisions . Justice concentrates on giving people what is due to them, by respecting their rights and fairly rewarding perceived performance in the workplace. To evaluate the fairness of ethical decisions, three kinds of justice are often used. Distributive justice is the first form of justice, and it pertains to evaluating the outcomes of business decisions and transactions. For Mattel, it seeks to promote distributive justice because it is concerned about the equity of its decision outcomes. The company promotes fair hiring and workplace conditions, for instance, that served workers’ interests. On the contrary, Mattel cannot attain distributive justice, when its licensees are concerned. GMP applied only to companies owned and/or managed by Mattel, which does not include licensees. Justice for all employees cannot be attained through selective auditing policies.

Community Relations of MAS holdings

Community Relations of MAS holdings In any company, the greatest challenge is managing the business. To support this end, a companys relationship with the community plays a pivotal role. In terms of corporate social responsibility MAS Holdings has done a considerable amount of work towards uplifting Sri Lankans in a social context. It has also worked to retain customer attraction through achieving their targets and maintaining customer compliance standards by ensuring the employees work in a safe working environment. This report illustrates MAS Holdings relationship with the community and provides recommendations for improving community group relationships for business well-being. Company Background MAS Holdings is a company, which has focused on the apparel manufacturing business for the last 20 years. It has great success to date with a consolidated turnover of approximately more than 400 million USD and has a massive growth in operations. The majority of the success has been achieved within the US market, which accounts for almost 60% of sales. Europe and UK provides the majority of the balance. In terms of customer focus, the company gains 50-55% of turnover from Victoria Secret, 14% from Gap another 10% from Marks Spencer. In terms of global presence, the company is present in more than 5 locations globally, including China, Vietnam, Indonesia, Mexico, India, Hong Kong, United Kingdom, Maldives and US. The company is made of multiple investments mostly in the form of joint ventures in Intimate Apparel Manufacturing, Elastic Manufacturing, Knit Fabrics, Lace, Bra Accessories and recently Design Development. Key stakeholders and their level of influence and impact on the company 2a). Benefits of stakeholders analysis for MAS Holdings Undertaking a taking stakeholder analysis benefits the company as follows, Opportunity to identify the interest of the all stakeholders on the company Recognizing the groups that affect or affected by the company The power level of each stakeholder and ways to reduce negative impact on the company Identifying the stakeholders who have decrease association with MAS and getting them involved in company events at particular stages Identify potential issues that might disrupt the company It also helps to visualize the risk factors and plan strategic responses 2b). Key community groups and their impact on the company Stakeholder mapping provides insight in to which parties have the most impact on the company (See appendix 2). Described below is the influence and impact of each stakeholder. CEO and The Board of Directors (High Interest + High Power) This includes companys major players and potential stakeholders. In it consists of the chairperson, Mahesh Amalean and the board of directors which includes the other two Amalean brothers and 7 directors. (Refer appendix 2 figure) From the beginning MAS was a benchmark for being a superior employer. All the main key players of the company are responsible for sustainability in community development. By looking at the significant steps that have been taken by them to develop the community and their employees it is clear that they have made a big difference. As per Ajay Amalean it was the right thing to do. We had absolutely no idea that 20 years down the road, the things we were doing would be called CSR. Venture Capital and Customers of (High Interest + High Power) According to the power interest mix (Refer appendix 2 Figure 2) there is a clear indication that this is a category with high interest and power. Without these key individuals or groups, such as joint ventures, with Speedo and strategic partners such as Nike, Makes Spencer, Victorias Secret and Gap MAS Holdings part of the business operations would not have its current success. When MS selected MAS for their green manufacturing plant project (As mentioned in appendix 2 page ii) it demonstrated their recognition as a global customer that MAS is an organization that is conscious of environmental and social sustainability. This recognition will results in better relationship with worlds leading brands that are under pressure to maintain sustainability and it will help to maximize the profit of the company by attracting new customers and through customer retention. Employees (High Interest + Low Power) The higher management at MAS Holdings has set its employee objectives which are called as KPIs (Key performance indicators). However the drivers of these main KPIs are the employees themselves. It is noticeable in the Mendelows matrix (Refer appendix 2 Figure 2) this category holds high interest and low power on decision making. This group includes the executives and the machine operators of the company. In MAS, 92% of the employees are women. Focusing the women in the company MAS has launched an empowering program which is called Women Go Beyond (Refer appendix 2 page v). The men, who are working at MAS, enjoy the same benefits as women. These activities result in company growth through employee attraction and retention. Thus recruiting process is easier and the annual labor turnover is much less. As mentioned in appendix 2 these activities also results in higher productivity of operations, which is a one of the main achievements of a manufacturing plant. Community ( Low Interest + Low Power ) As mentioned in the mendelows matrix this category has a low interest and a power, but the company point of view its important to have a close relationship with the communities MAS operators. Hence they need more man power for their operations and its a great advantage when having a close relationship with the community specially in recruiting people and also in retaining them which will be discussed future in the report. How MAS use relationship marketing and approach the community through its concept 3a). Relationship marketing Relationship marketing refers to all marketing activities directed towards establishing, developing and maintaining successful relational exchanges Morgan hunt 1994 It is important to understand the benefits of maintaining good relationships with the community groups. Not only in FMCG companies but also within business to business companies, manufacturing plants benefit by having close relationships with the community groups that are relevant to them through the practice of sustainability within these communities. Though it doesnt have a direct impact on the company with regards to profits, sustainability, helps to increase the company standards, reputation and profits in a way that is mutually beneficial to the community and the company. By developing such enduring relationships the company can gain trust within the community, build employee commitment and loyalty towards the company. These things give long lasting benefits to the company. MAS Holdings is a company that gets these positive results out of such community relationships. 3b). What MAS Holdings does to attract their community groups and reach their hearts When building a relationship it should be done from a combination of Trust, commitment and cooperation. Trust According to Morgan hunt trust is defined as confidence in an exchange partners reliability and integrity Trust can be seen as a long term investment for the business. It works as glue in building business relationships with all stakeholders. Building trust among the customers and suppliers of will allow the MAS business to gain the upper hand to improve business with the US and European countries. In the same way MAS holdings most important resource is labor. As mentioned before 92% of the employees are women. Sri Lankan women are very particular in selecting the working place. Considering the culture, tradition of Sri Lanka, its important for women to have a safe working environment in manufacturing plants which will enhance their trust and the trust of the community. For an instance when started first EPZ in Katunayake and the country is declared as a free trade area most of investors started garment factories in those areas. 90% of the works become women, most or 18 25 of age and they came from rural area of the country, lived in boarding houses near the factory. In this period most of the employees suffered from sexual harassment and assault. They also had long working hours even without prior notice. Breaking through these grey clouds MAS become one of the best employers in Sri Lanka by creating a safe working environment. In addition the Amalean brothers made sure that their work force worked in an air conditioned environment, had free meals, and were given transportation to and from the factory. Commitment This is one the most important element which strengthens relationship marketing. As per Morgan and hunt, commitment is an enduring desire to maintain a valued relationship (Morgan and Hunt 1994, 23) Commitment could be considered in different ways, 1.Commitment towards the organization by the employees, commitment towards the brand or the product also the commitment towards the community etc. In order to foster this commitment MAS Holdings, created incentives based on service period giving gold coins to employees that had completed 5 years of service, providing increments each year so that an employee knew that if they stayed one more year their salary would increase and giving bonuses based on performance which encouraged the employees to be committed to continuous improvement. Co-operation with community groups In order for a business to operate in a geographic location it is important that the people living there are ready to accept the presence of this business. As MAS Holdings has many plants in many locations it has found it useful to co-operate with various community groups in order to establish their presence. For example through the Shadeline factory in the remote area of Mahiyanganaya, various projects were undertaken. These included assistance in building houses funding for primary education and assistance in social welfare. Some of the community assistance was provided through the Buddhist temple in the area which provided access to large portions of the community. Further to that association with the local police and welfare societies provided inroads to the lives of the people. The Level of influence and impact applied by pressure groups on MAS Holdings 4a. Pressure groups Pressure groups are organizations that seek to influence government the public and private business or advance a cause. Often they advance a political or ideological goal. These groups can be placed in to two main categories. Sectional Pressure groups Causal Pressure groups 4b. Sectional Pressure groups Sectional pressure groups represent a section of society. The pressure cause by these groups is often directly beneficial to the members. Religious groups (High impact) -Often in the rural areas of Sri Lanka where several of the MAS Factories are situated the Buddhist temple in that area is the central meeting place and many decisions are made there. MAS as an organization is encouraged to follow the local customs and cultural habits. The Employers Federation (High impact) -is a legal organization that MAS is part of. Adhering to the guidelines set by this organization is beneficial for MAS Holdings goal of ethical hiring and employment 4c. Causal Pressure groups Causal Pressure groups are associated with a set of ideas rather than people. The agendas they pursue may not be directly beneficial to their members. As a member of certain key groups MAS must adhere to standards they set. Some of these are listed below: The Joint Apparel Association Forum (JAAF) (Low impact) is the leading umbrella organization concerning the apparel industry in Sri Lanka. Making Sri Lanka the number one ethical destination for garment manufacturing (the Garments without Guilt initiative) is one of its chief objectives. MAS Holdings is a special invitee to this Forum and is expected to conform to the directives set by this forum. Several sub organizations are part of the JAAF. FAAMA Fabric Apparel Accessory Manufacturers Association FTZMA Free Trade Zone Manufacturers Association NAEA Apparel Exporters Association SLAEA Sri Lanka Apparel Exporters Association SLCGE Sri Lanka Chamber of Garment Exporters SLGBOA Sri Lanka Garment Buying Offices Association Various SBUs of MAS Holdings are involved in many of these sub organizations as well. Worldwide Responsible Accredited Production (WRAP) (High impact) -MAS Holdings is a member of and must adhere to their standards as well. The Board of Investment of Sri Lanka (Low impact) As a member MAS must adhere to certain standards. While these organizations are quite influential in Sri Lanka, MAS has lead the way in Ethical and Responsible employment therefore it is MAS that often sets the standards for these organizations. New communities that MAS can expand their services fro the betterment of the society In the tradition of MAS to lead in the area of CSR in Sri Lanka and sometimes the world, this could be taken for further by analyzing new community groups will always give the opportunity to connect to the community. Its proven that MAS is one of the fast growing companies in the world. Its very important to have a good relationship with the local government, society that they operators since it need more man power and carry out their operations in the respective communities. MAS has been doing all community projects targeting the employees and society such as women go beyond and other CSR activities (Refer appendix 2, page v vi). It needs to look in to future prospect in terms of building a close relationship and the target audiences of the new community groups are, Skilled future generation for Srilanka Target Group -School leavers of MAS employees Providing educational opportunities to the community in areas of English language education and IT Lets learn the importance of environmental sustainability Target Group -Schools (Students) Achieving sustainability Practicing and teaching Environmental sustainability 4 a) Why MAS should choose these two community groups Since MAS is targeting on the community itself it gives greater results to the company and the country when considering future leaders, minds in the country. By providing education which is required in the current business world it helps the young generation to foundation their career paths. By creating a strong and stable generation, it will eventually strengthen the communities of Srilanka, starting from the area that, MAS manufacturing plants operators. This will also benefit the country. When looking company point of view this program will not directly impact, but this will increase imagine and the good will of MAS among the communities which will help the company in recruitments and also in retaining employees. As per the 2nd community group, by helping the schools and spreading the massage about the importance of environmental sustainability by teaching them from their small ages it will give a give impact in their personal lifes as well as the country, environment. Also as mentioned before by establishing the name of MAS in their hearts by doing a worthwhile project to their lifes and the community MAS always be company that is socially responsible. Hence most of the MAS customers are particular on the CRS projects that MAS does, these kinds of projects gives positive marks and will strength the relationship with the customers as one of the responsible suppliers in the world which will attract more customers around the world. 4b Skilled Future generation for Srilanka Providing educational opportunities to the community in areas of English language education and IT MAS competes in the global market and deals mainly with the US and Europe. In order to communicate with its customers the most relevant language is English. No business that is global can survive without information. MAS recognized this need early in the game and is dependent on Information Technology for all information needs both internal and external. While there have been government initiatives to foster the teaching of English and IT these have often failed due to a lack of funding or will power. Having a community that is fluent in English and adept in IT provides MAS with a greater pool of individuals to select from for employment. Before looking at the all the school leavers MAS could target on the family members of employees at MAS. The selection criteria of this could a relative of a employee at MAS, who is 18 -27 age and has completed G.C.E advance level 2 passes and unemployed. While providing primary education to these communities can be carried out by supporting the government initiatives, family members of employees can be chosen out of the community to provide scholarships for further education. In this way MAS can give back to those who support the business while building trust, commitment and sustainability in the community. 4c Lets learn the importance of Environmental sustainability Achieving sustainability Practicing and teaching Environmental sustainability MAS was the first company to recognize the need for Environmental sustainability as a key global concept and put this knowledge into action by creating the first green plant in Sri Lanka. In order to take this message to the community in general MAS will have to create awareness and provide education. Currently there is no provision in the Sri Lankan school curriculum to teach environmental sustainability. Target group could be taken as 15-18 year old students hence it is the best age group that can be thought the importance of environmental sustainability and make it their way of life. To communicate this massage to the selected audience would be schools which are located in the areas that MAS manufacturing plants. As this area of education is most relevant to the future generation it is important that this area of study be included in the Schools curriculum. It is possible that MAS can team up with experts in the field from the United Nations Environment Program (UNEP) to get government approval and support to introduce this vital area of education. By conducting this program in schools, MAS is creating educated youth to the community and also who will be a example to the society and a person who carries a massage on how important sustainable development. These will also benefits MAS indirectly by establish a reputation among the community which the plant operates. Coordinated Communications mix for new community groups projects In order to have success in these two ventures it will be necessary to have a coordinated communication plan. The communications mix must target all the relevant stakeholders. As these are non-profit initiatives the communications mix must be adapted to suit the situation Internal stakeholders Management, Employees External stakeholders- Community, Government, Partners, Customers 5a. Internal stakeholders Management In order for both these initiatives to be successful the management must be aware of them and back them. As most of the decisions for funding will come from this group of individuals it is recommended that direct contact is made (personal selling) and the use of presentations would be advisable. An e-newsletter sent directly to their e-mail account and linked to a website with Links on Facebook and Twitter will provide them with any additional information they need and provide regular updates on the status of these projects. Management can also form a committee or working group to oversee and monitor the process of teaching and the progress of these initiatives. This group will report back to the management. Employees The employees too can receive the same newsletter and management can communicate the needs and progress to the employees at meetings. Making it possible for the employees to get involved in the teaching programs and funding is also recommended so that there is a greater employee ownership for these initiatives. 5b. External stakeholders Community By far the most effort and resources must go to making the community aware of these initiatives and the benefit thereof. While the employees in the community will take part of the message by word of mouth assuring that the correct communication is conveyed will require further effort on the part of MAS Holdings. At the inception of these initiatives the best option would be to start with a public relations campaign which includes press conferences, announcements at town meetings and branding. Having a Brand ambassador (such as one of the members of the Sri Lankan cricket team that work for MAS and are highly regarded by both urban and rural communities)would give a face to these initiatives. The most important part of these communities are the individuals that will receive the benefits of these programs. The teachers and students will receive their curriculum via an approved government syllabus. But programs and workshops can be organized (personal selling) to assure that quality information is available to theses two groups. Having exams to measure English and IT competency and contests to select the best idea for environmental friendliness with prizes awarded t best student or best idea will assure the students interest in these subjects (promotions). Government The shareholders of MAS have demonstrated their goodwill and capability they will not find it difficult to obtain government approval for these initiatives. Recently the government too took the stand that the way forward is through English education and IT. Furthermore if it is demonstrated to them that environmental sustainability is the way forward they too will join the process of becoming green direct selling is the most efficient method of communication here. Partners A great strength of MAS in carrying out a project is working together with partners who have the expertise. Involving The British Council for English education, Microsofts teaching services for fundamental IT education would provide a first step in these areas. For environmental sustainability United Nations Environment Program (UNEP), the Consumer Citizenship Networks (CCN) and the Looking for Likely Alternatives (LOLA) toolkit provide information and know-how. Having joint ventures with the above organizations would be beneficial to MAS and will lean credibility to the efforts. Customers Many customers are interested in the CSR projects undertaken by MAS. In MAS communiquà ©s it is possible to include the websites and social networking sites so that the customers can access more information about these projects. Allowing the customers to get involved through sponsorship will afford them an opportunity to pass on to their customers or the end customer the knowledge that they are not only receiving guilt free environmentally friendly products but also [part of the purchase is going towards community building and the education of the less fortunate. The garments could carry labels such as produced in eco-friendly factories, or your purchase provides for the education of a child in Sri Lanka. Measuring the success of the communications mix for both new community relationships In order to measure the success of the communications mix the standard evaluation criteria must be adapted to reflect the non-profit nature of this venture. Quantitative Measures Managements and employees contribution both financially and through time allocation can be easily quantified. That can then be used as an indicator of the success of the marketing communications. In the long run the number of individuals that are retained by MAS that have attended these programs can be counted and both the success of the internal communication strategy and the success of the programs can be evaluated. Community awareness can be measured by the number of individuals attending the programs. Also the exams that are held for the individuals and the response to the contests will give an indication of the success of the community communication strategy. Using benchmarking tools that the partners have developed over the years it may be possible to measure the success of the communications that have been carried out. For Government, Partners and Customers the main indication of the success of the communication strategy will be their financial participation. Targets must be set for the anticipated contribution and measuring the success of achieving these targets will give a clear indication of the said success. Hits on the website can also be used to quantify interest and communication success. Qualitative Measures Feedback can be obtained from Management and Employees as to their perception of the programs through an e-mail survey. Feedback can also be obtained from the students to ascertain their perceptions and attitudes towards the program. Furthermore community inquiries regarding the program can be accumulated and categorized to measure and determine the success of the communications mix. Conversations with the partners and customers can indicate their observations and thoughts on the endeavor. All this information can be used to measure the success of the marketing mix. Recommendation Continue doing community projects more which will support to sustain the relationship with the community and will also visualize the organization as a good responsible citizen Internally set key performance indicators to measure the amount of CSR projects completed and the quality of the program and the no.of impacts in order to understand value of the programs and can forecast the type programs should given to the community Conduct programs for male members in the company while carrying out women go beyond for the female team members to all employees motivated Manage communication campaigns to the new community groups in a strategic way to attract them to the projects conducted and built trustworthiness among the company Prepare booklets, including CSR projects that has made a difference in the community and also use modern technology to spread the good will of MAS holdings and attract customers Always keep the employees informed on the CRS projects that are done by the company and make feel them that they work for a socially responsible organization Implement a system to collect feedback from all the participants of the CSR projects. Also for new ideas for new projects from employees as well as external groups Conclusion Its very important to maintain a mutually beneficial relationship all the stakeholders since each of them are directly or indirectly involve with the company. MAS has become one of the best multinational companies in terms of business also in community relationships they have maintained. By establishing a good reputation among the communities they operators, local government, customers also the pressure groups it has been easy to execute their business activities anywhere in the country and the world. References Appendix 1 Company Background It was in 1987 when the three brothers, Mahesh, Sherad and Ajay Amaleans took their first step to begin as a small entrepreneurial and to make it one of the largest south Asian intimate apparel manufacture and a competitive sportswear provider in the region. Now a company, with an annual turnover of USD 700 million. MAS Holdings which operates globally includes design studios, and 28 world class manufacturing plants. Thus giving career opportunities for over 45000 people to, excel through their talents and capabilities. MAS Holdings consists of four main divisions namely Intimates, Active, Fabrics, and Investment which are overseen by Corporate Solutions which centralizes the operation in all four strategic business units. Furthermore MAS Holdings has taken a step forward by launching its own lingerie brand Amante in fall 2007 and have made it their strategy to be the premium lingerie brand in Asian region. Vision and the Mission of Vision No.1 preferred partner of the world is leading brands of Intimates Sportswear with a turnover of USD 1Bn by 2010 Mission We provide the worlds leading brands of Intimates Sportswear with reliable innovative design to deliver solutions. Strategic partners and customer portfolio MAS has become one of the strategic vendor for some of the best brands in the world such as Victorias Secret, Nike and Marks Spencer also it services other global brands as Adidas, Reebok, Columbia, Lulu lemon, Banana Republic, Ann Taylor, Lane Bryant, Soma Intimates, GAP and Speedo and much more. Victorias Secret Stores and Nike selected MAS as Vendor Partner of the Year 2006. One of the key factors of MAS success is the ability to forge partnerships with the leaders if the industry such as The Limited Inc,  Triumph International, Speedo International, Stretchline UK, Noyon Dentelles, Prym Intimates Group, Dogi International, Textprint SA and Brandot International. Product range portfolio MAS products can be categorized as below. Competitors of and the market position As a large manufacturing company MAS has international and local competitors. Internationally competitors would be Ace which is a large intimate manufactures in Hong Kong, Clover, Luen Thai which operates in several countries and Tefrone the main competitor in the seamless market and Brandix apparel which is the local rival. Victoria secret positions MAS as their main preferred vendor and the company is regarded as one of the the top 10 intimate manufactures in the world. Analyzing all the information motioned above its clear that MAS holding is a successfully driven family owned company. The brothers decided to stick to their joint venture criteria of choosing partners who brought in technology expertise, marketing knowledge or access to certain markets. Background for Best Ethical practices MAS holdings as a history of ethical business practices that predate the concept of CSR. In addition, it ensures a healthy and safe work place, which regarded as a good business practice. However, the ethical approach to manufacturing is setting the organization apart from the competitive apparel sector. To support the vision of itself developed their own CSR strategy called MAS Go beyond, this program empower the organizations 92% of the female workforce also develop a sustainability-mined n youth, future employees and leaders of the organization. Source Company website, Researches on the web, Company Magazines

Laughing And Sense Of Humor Essay examples -- essays research papers

Laughing and Sense of Humor â€Å"What is it that differentiates human beings most revealingly? Some say it is their varying degrees of compassion; others say it is amounts of prudence; still others, people's differing appreciations of beauty, or whatever makes them angry. And there are other possibilities worth considering. But in truth nothing is so revealing as a person's sense of humor.†   Ã‚  Ã‚  Ã‚  Ã‚  It is not very hard to notice the many differences between people. There are thousands of things that differentiate us. Appearance is of course the most obvious but in reality appearance does little to actually distinguish people outside of identifying them. Having blue eyes does not say anything about my attitude, my beliefs, my likes or dislikes. Of course there is no one, single character trait that will best identify a person. Humans are extremely complex. Most of us spend our entire lives trying to figure one another out. (This is especially true when attempting to figure out females.) Clues can be found anywhere. The books a person reads, the movies they watch and the games they play all reveal little bits of their character.   Ã‚  Ã‚  Ã‚  Ã‚  It is a fair comment though that the most revealing character trait a person has is their sense of humor. Few things are as distinguishable and noticeable as humor. Laughs echo throughout rooms and they are as unique as snowflakes. Jokes have been told and retold for centuries by men and women of all ... Laughing And Sense Of Humor Essay examples -- essays research papers Laughing and Sense of Humor â€Å"What is it that differentiates human beings most revealingly? Some say it is their varying degrees of compassion; others say it is amounts of prudence; still others, people's differing appreciations of beauty, or whatever makes them angry. And there are other possibilities worth considering. But in truth nothing is so revealing as a person's sense of humor.†   Ã‚  Ã‚  Ã‚  Ã‚  It is not very hard to notice the many differences between people. There are thousands of things that differentiate us. Appearance is of course the most obvious but in reality appearance does little to actually distinguish people outside of identifying them. Having blue eyes does not say anything about my attitude, my beliefs, my likes or dislikes. Of course there is no one, single character trait that will best identify a person. Humans are extremely complex. Most of us spend our entire lives trying to figure one another out. (This is especially true when attempting to figure out females.) Clues can be found anywhere. The books a person reads, the movies they watch and the games they play all reveal little bits of their character.   Ã‚  Ã‚  Ã‚  Ã‚  It is a fair comment though that the most revealing character trait a person has is their sense of humor. Few things are as distinguishable and noticeable as humor. Laughs echo throughout rooms and they are as unique as snowflakes. Jokes have been told and retold for centuries by men and women of all ...