Research Paper

Running head: ANNOTATED BIBLIOGRAPHY 1

ANNOTATED BIBLIOGRAPHY 2

Annotated Bibliography

Name

Institutional Affiliation

Annotated Bibliography

Adam, K., Marcet, A., & Nicolini, J. P. (2016). Stock market volatility and learning. The Journal of Finance, 71(1), 33-82.

This article is based on a specific model related to stock price volatility. This model is vital because it relaxes its rational expectations and assumptions. It makes the assumption that investor expectations regarding future gains tend to be revised slightly upwards if they observe higher capital gains. The main idea here is to demonstrate the empirical significance of stock price behaviors (Adam, Marcet & Nicolini, 2016). In this context, this article will help in addressing the state of stock trading and how the process takes place.

Coeurdacier, N., & Gourinchas, P. O. (2016). When bonds matter: Home bias in goods and assets. Journal of Monetary Economics, 82, 119-137.

This article addresses the issue of trading domestic and foreign bonds together with equities. The core idea here is to demonstrate that bonds matter especially when it comes to investment structure and equilibrium. The core themes of this piece include risk sharing, international portfolios, and equity home biases (Coeurdacier & Gourinchas, 2016). For purposes of this research paper, this article will aid in appreciating the instances when bonds are deemed integral in deriving investment equilibrium.

Elton, E. J., Gruber, M. J., Agrawal, D., & Mann, C. (2001). Explaining the rate spread on corporate bonds. The Journal of Finance, 56(1), 247-277.

The main focus of this article is on the impact of spot rates on government and corporate bonds. Ideally, this spread can be explained based on compensation for default of corporate bonds, compensation for state taxes, and compensation for systematic risk in business bond returns related to government bond returns. The authors demonstrate the systematic nature of corporate bond returns with a set of variables that impact risk premiums in the context of stock markets (Elton et al., 2001). This article will enhance the subsequent research through elaborating on the concept of rate spread and how it impacts the value of bonds in trading.

Fama, E. F., & French, K. R. (1989). Business conditions and expected returns on stocks and bonds. Journal of financial economics, 25(1), 23-49.

This article addresses both the issue of bonds and stocks. It goes further to marry these concepts with business conditions. Basically, there is a very close relationship that exists between stocks and bonds and the business art large. It is thus necessary to appreciate how the two integrate (Fama & French, 1989). For purposes of this research, this article will aid in harnessing the relationship between stocks, bonds and the business setup.

Godlewski, C. J., Turk-Ariss, R., & Weill, L. (2013). Sukuk vs. conventional bonds: A stock market perspective. Journal of Comparative Economics, 41(3), 745-761.

This article gets out of the norm and addresses the recent expansion of Islamic finance in the Middle East region. Sukuk, or Islamic financial instruments, are nowadays being used in tandem with conventional bonds. The article uses an event study to demonstrate the close linkage between these two concepts and how they have shaped the modern financial markets (Godlewski, Turk-Ariss & Weill, 2013). In this research context, this article will marry financial choices made based on religious and cultural beliefs and values.

References

Adam, K., Marcet, A., & Nicolini, J. P. (2016). Stock market volatility and learning. The Journal of Finance, 71(1), 33-82.

Coeurdacier, N., & Gourinchas, P. O. (2016). When bonds matter: Home bias in goods and assets. Journal of Monetary Economics, 82, 119-137.

Elton, E. J., Gruber, M. J., Agrawal, D., & Mann, C. (2001). Explaining the rate spread on corporate bonds. The Journal of Finance, 56(1), 247-277.

Fama, E. F., & French, K. R. (1989). Business conditions and expected returns on stocks and bonds. Journal of financial economics, 25(1), 23-49.

Godlewski, C. J., Turk-Ariss, R., & Weill, L. (2013). Sukuk vs. conventional bonds: A stock market perspective. Journal of Comparative Economics, 41(3), 745-761.