• Journal of Distribution Science
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• v.13 no.9
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• pp.37-45
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• 2015

Purpose - This paper's aim is to investigate whether or not gross profitability explains the cross-sectional variation of the stock returns in the Korean stock market. Gross profitability is an alternative profitability measure proposed by Novy-Marx in 2013 to predict cross-sectional variation of stock returns in the US. He shows that the gross profitability adds explanatory power to the Fama-French 3 factor model. Interestingly, gross profitability is negatively correlated with the book-to-market ratio. By confirming the gross profitability premium in the Korean stock market, we may provide some implications regarding the well-known value premium. In addition, our empirical results may provide opportunities for the fund distribution industry to promote brand new styles of funds. Research design, data, and methodology - For our empirical analysis, we collect monthly market prices of all the companies listed on the Korea Composite Stock Price Index (KOSPI) of the Korea Exchanges (KRX). Our sample period covers July1994 to December2014. The data from the company financial statementsare provided by the financial information company WISEfn. First, using Fama-Macbeth cross-sectional regression, we investigate the relation between gross profitability and stock return performance. For robustness in analyzing the performance of the gross profitability strategy, we consider value weighted portfolio returns as well as equally weighted portfolio returns. Next, using Fama-French 3 factor models, we examine whether or not the gross profitability strategy generates excess returns when firmsize and the book-to-market ratio are controlled. Finally, we analyze the effect of firm size and the book-to-market ratio on the gross profitability strategy. Results - First, through the Fama-MacBeth cross-sectional regression, we show that gross profitability has almost the same explanatory power as the book-to-market ratio in explaining the cross-sectional variation of the Korean stock market. Second, we find evidence that gross profitability is a statistically significant variable for explaining cross-sectional stock returns when the size and the value effect are controlled. Third, we show that gross profitability, which is positively correlated with stock returns and firm size, is negatively correlated with the book-to-market ratio. From the perspective of portfolio management, our results imply that since the gross profitability strategy is a distinctive growth strategy, value strategies can be improved by hedging with the gross profitability strategy. Conclusions - Our empirical results confirm the existence of a gross profitability premium in the Korean stock market. From the perspective of the fund distribution industry, the gross profitability portfolio is worthy of attention. Since the value strategy portfolio returns are negatively correlated with the gross profitability strategy portfolio returns, by mixing both portfolios, investors could be better off without additional risk. However, the profitable firms are dissimilar from the value firms (high book-to-market ratio firms); therefore, an alternative factor model including gross profitability may help us understand the economic implications of the well-known anomalies such as value premium, momentum, and low volatility. We reserve these topics for future research.

• Asia Marketing Journal
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• v.15 no.4
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• pp.33-49
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• 2014

Environmental concern has been an important issue for a few decades, and the extent of consumer demand for eco-friendly consumption has been increased. This study seeks to investigate consumers' willingness to pay (WTP) a premium for eco-friendly cosmetics. This study evaluates how much more a consumer is willing to pay for eco-friendly cosmetics and examines significant factors influencing consumers' WTP for eco-friendly cosmetics. Consumers' WTP is measured using four different ecofriendly cosmetics: low-priced skin care cosmetics, low-priced makeup cosmetics, high-priced skin care cosmetics, and high-priced makeup cosmetics. This study uses the contingent valuation method (CVM) to estimate consumer's WTP for eco-friendly cosmetics. Survey questions were designed using both dichotomous choice and payment card method of CVM. Through face to face interviews and on-line surveys, the data were collected from women between 20 and 49 years old residing in Seoul and Kyeonggi area, Korea, in May 2010. A total of 226 questionnaires (132 from interviews and 94 from on-line) were included for the analytical sample in this study. The data were analyzed using descriptive analysis, T-test and Log-Logit analysis. The findings are as follows: First, the WTP measured by dichotomous choice method was estimated using the Log-Logit analysis. The results showed that the estimated WTP for low-priced skin care cosmetics was 19,152 won, which was 27.7% higher than the reference price, 15,000 won. For low-priced makeup cosmetics, the estimated WTP was 18,524 won, and its green premium was 21.0%. The estimated WTP for high-priced skin care cosmetics was 59,128 won, which was 18.3% higher than the reference price, 50,000 won. For high-priced makeup cosmetics was 57,666 won, and its green premium was 15.3%. Second, the WTP measure by payment card method was estimated using descriptive analysis. The results showed that the respondents were willing to pay 17,955 won for low-priced skin care cosmetics, which was 19.7% higher than the reference price, 15,000 won and 17,595 won for low-priced makeup cosmetics, which was 17.3% higher than the reference price. For high-priced skin care cosmetics, the average WTP was 56,950 won which was 13.9% higher than the reference price, 50,000 won. For high-priced makeup cosmetics, the average WTP was 55,650 won, which was 11.3% higher than the reference price. Overall, the WTP was higher in order of low-priced skin care, low-priced makeup, high-priced skin care, and high-priced makeup. It means that consumers decide degree of premium based on the price and the attributes of eco-friendly products. Third, the findings showed that age, monthly income, and having children or not were statistically significant factors that influenced consumers' willingness to pay for eco-friendly cosmetics. Other explanatory variables such as education, marital status, job, purchase experience of eco-friendly products, and environmental concerns did not show any statistical significance. The major contribution of this study is the investigation of the value of green attributes of the products by using CVM. Unlike most previous researches, this research used two methods of CVM, the dichotomous choice and the payment card, so it enhanced the reliability of research. According to this study, consumers showed price sensitivity when they pay green premium. These findings can be used as useful information to establish marketing strategies for green cosmetics.

• The Korean Journal of Financial Studies
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• v.2 no.1
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• pp.145-158
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• 1995

According to recent empirical studies, there is a systematic pattern in temporal behaviors of asset returns, and that systematic pattern is related to the business cycle. I propose a model which captures this evidence. This is done by considering a state dependent preference structure where state dependency is related to the business cycle. In this setting, the three main puzzles(i.e., the volatility puzzle, the equity premium puzzle, mean reversion) are understood as interrelated behaviors.

• Proceedings of the Korean Society of Tribologists and Lubrication Engineers Conference
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• 2002.10a
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• pp.55-62
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• 2002

Significant changes in the performance requirements of finished lubricants is having a pronounced impact on the quality and manufacturing approach for base stocks, the building block for these products. Separation processing is no longer capable of producing high yields of premium base stocks and is rapidly being replaced with hydroprocessing. Isoparaffins are the most desirable component because of their high Viscosity Index, low pour point and excellent stability. This paper will discuss industry trends and the drive towards higher quality base stocks. Manufacturing options are discussed and examples presented to demonstrate the performance of these premium base stocks.

• The Korean Journal of Financial Management
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• v.12 no.2
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• pp.207-219
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• 1995

This paper develops an equilibrium asset pricing model with taxation in the economy. The expected excess rate of return on a risky asset is shown to be an increasing function of the covariance of asset return with aggregate consumption rate changes and the covariance of asset return with the tax rates as well. Thus, the expected execss rate of return can be decomposed as the consumption risk premium and the tax premium. The capital asset pricing model derived in the absence of taxes is shown to understate the expected excess rate of return and to have a misspecification error in the economy with taxation.

• Korean Architects
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• s.546
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• pp.46-51
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• 2014

• Journal of Korea Technical Association of The Pulp and Paper Industry
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• v.34 no.4
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• pp.30-36
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• 2002

This research was conducted to investigate the feasibility of using deinked pulp of white ledger(DIP) for the manufacture of high quality premium tissue. The three types of tissues were prepared using the softener treated bleached DIP, softener treated mixed pulp of unbleached DIP and virgin pulp, and untreated mixed pulp of bleached DIP and virgin pulp, respectively, and their tensile index. softness, and brightness were measured and compared. The bulk and surface softness increased only slightly by the addition of softener(0.2% mineral oil) into the bleached DIP. The tensile index was decreased by 15∼30%, and the brightness was the range of 86% to 87% ISO. The softener(0.2∼0.8% mineral oil or dialkyl imidazoline) treatment of mixed pulp of unbleached DIP and virgin pulp Improved the bulk and surface of tissue considerably. However, the brightness was low as 85% ISO or below. Although the softness of the tissue made from bleached DIP blended with virgin pulp was the lowest among three types of tissues evaluated, its tensile index was the highest and brightness was 87∼88% ISO. Based on the results, it may be predicted that the bleached DIP blended with virgin pulp is the best raw material for the manufacture of high quality premium tissue if softener treatment is applied to mixed pulp, because the softness can be improved by the addition of softener. In general, the softness of tissue was improved with the increase in the amount of softener: However, the tensile index inversely proportional to the amount of softener added. Dialkyl imidazoline was more effective than mineral oil with respect to the improvement in softness, even though the loss in tensile index was severe with the treatment of dialkyl imidazoline.

• Journal of Digital Convergence
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• v.15 no.8
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• pp.375-381
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• 2017

The America film, Beauty and Beast has grossed over 4,273,401 after being released for 21 days. The growth of movie profit in the video market is also developing rapidly. In this paper, we will focus on the PLF(Premium Large-Format) video technology, because PLF video technology can help audience to enhance the sense of 'immersion' and enjoy a different visual feast. In PLF video technology, IMAX, screen X, 360 degrees circular screen are the most important formats. By comparative analysis of these 3 formats, the biggest difference is their number of screens and appearance. Based on the result we can understand the 3 kinds of PLF platforms better and help us to make a choice between them. In addition, further research about the manufacture method of PLF technology will be discussed.

• Journal of the Korea Institute of Information and Communication Engineering
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• v.13 no.6
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• pp.1065-1071
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• 2009

Satellite application services can be divided into realtime services like voice communications and non-real time services like traditional data communications. To support both types of services on the same On-Board Switching(OBS), a scheduler which depends on their service classes is required. A fixed priority scheduling policy has a starvation problem. In this paper we propose a scheduling scheme based on premium and age. Premium is a fixed value which is given to a certain class of services. Age is another parameter of the scheduling policy and it will be increased by one for every scheduling cycle. The scheme we propose chooses a packet which has the largest sum of its age and premium. Simulation results indicate that the proposed approach shows better performance in both average cell delay and std-dev of cell delay for the lower class of service. There is no staying in infinite starvation state.

• Environmental and Resource Economics Review
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• v.17 no.2
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• pp.327-347
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• 2008

This study proposes a new answering mechanism of deciding whether to purchase or not under uncertainty-real risk answering mechanism (R-RAM) for real transaction and hypothetical risk answering mechanism (H-RAM). It IS also. shown that the traditional answering mechanism (TAM) assumed in most of existing contingent valuation methods should be applied in a real transaction without uncertainty. While the willingness to pay (WTP) being simply compared with the bidding price m TAM, the mean of WTP should be greater than the bidding pnce at least by the risk premium for a purchase decision m R-RAM and H-RAM. Only difference between R-RAM and H-RAM is risk premium. The H-RAM takes a smaller risk premium than the R-RAM. This study proposes the contingent valuation method (CVM) with H-RAM could be an alternative to reducing the under-or over-estimation of WTP by comparing the WTP estimates obtained from three different CVMs with TAM, R-RAM and H-RAM.