Modern Finance and Risk Management

Modern Finance and Risk Management

Festschrift in Honour of Hermann Locarek-Junge


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Modern Finance and Risk Management is dedicated to our colleague, academic mentor, and adviser Professor Hermann Locarek-Junge. During his academic career, Hermann Locarek-Junge published several important contributions to the field of risk management and portfolio management and served as the chairman and board member of the German Finance Association (DGF) and the Data Science Society (Gesellschaft für Klassifikation).

A short foreword by the mentors of Hermann Locarek-Junge and an introduction by the editors mark the beginning of the Festschrift. The first section on Modern Finance includes chapters on asset management, entrepreneurship, and behavioural finance. The second section on Modern Risk Management contains seven contributions covering considerations of risk measurement, risk management, and regulation. Finally, the third section includes topics on commodities and energy finance.

This Festschrift comprises 20 original contributions of notable scholars in finance who have worked with Hermann Locarek-Junge over the last four decades. Due to numerous connections to practice and applications, Modern Finance and Risk Management is relevant and attractive not only to academics and researchers but also to practitioners in industry and banking.


  • Grußwort
  • Foreword
  • About the Editors
  • About the Contributors
  • Introduction (Tony Klein, Sven Loßagk, Mario Straßberger, and Thomas Walther)
  • Aspects of Modern Finance:
    • Confounding the Return Notions Could Be Dangerous (Günter Bamberg and Sebastian Heiden)
    • Emotionally Involved Investors — Is There Any Finance Theory Fitting to Ethical, Crowdfunding and Fan Bond Investors? (Ralf Trost and Alexander Fox)
    • How Did Risk-Reduced Investment Strategies Perform During the Corona Crash? Lessons Learned from the Crisis for the Asset Management Industry (Friedrich Thießen and Jörg Müller)
    • The Growth of Social Banks, Investment Restrictions, and Excess Liquidity Risk (Susanne Homölle, Nikolas Höhnke, Ulf Hübenbecker, and Philipp Winskowski)
    • Comparative Analysis of Determining the Risk-Adequate Cost of Capital for Regulated Network Operators in Network Industries (Ulrike Stopka)
    • Private Equity Investments and Value Creation in Small and Medium-Sized Enterprises (Benjamin Hammer, Nils Härtel, Suleiman Naiem, and Bernhard Schwetzler)
  • Aspects of Modern Risk Management:
    • The Risk of the Unseen (Steffi Höse and Stefan Huschens)
    • Tail Nonlinearly Transformed Risk Measure as a Capital Constraint — A Better Choice for Bank Regulation Than Conditional Value-at-Risk? (Kerstin Bergk, Mario Brandtner, and Wolfgang Kürsten)
    • Objectification of Subjective Risk Assessments (Lars Hengmith and Sophia Licht)
    • Model Risk as Multiplicative Risk Factor (Stefan Huschens and Gerhard Stahl)
    • Model Risk in Option Pricing — Estimation Risk of Volatility Parameter (Krzysztof Jajuga)
    • Reference Framework for Success Factors of Resilient Supply Chains and Practical Application on a Supply Chain Disruption (Rainer Lasch and Karl Dietrich)
    • Assessment of the Systemic Risk in the German Banking Industry (Katarzyna Kuziak and Krzysztof Piontek)
  • Aspects of Modern Commodity Finance:
    • Oil and Stock Market Returns: Direction, Volatility or Liquidity? (Harald Kinateder and Niklas Wagner)
    • Risk Reduction by Law: An Assessment of the German Renewable Energy Sources Act (Sven Loßagk)
    • Corporate Risk Management with Power Purchase Agreements (Andreas Horsch and Steffen Hundt)
    • The Christenson Gold Price Model Reconsidered (Thomas Burkhardt and Dominik Möhring)
    • In Gold We Trust: Should German Investors Consider Gold in Stock Portfolios? (Siegfried Köstlmeier and Klaus Röder)
    • Dynamic Correlation of Precious Metals and Equity Markets: A Mixed Data Sampling Approach (Tony Klein and Thomas Walther)
    • Cryptocurrencies as an Asset Class — Holding Bitcoin in German Equities Portfolios (Mario Straßberger)
  • Index

Readership: The global market of academics, researchers, and postgraduate students in the fields of finance and risk management. Also of relevance to finance practitioners throughout the financial industries, especially financial institutes, investment firms and financial service providers.