From the Editor:

December 2006

Dear Financial Decisions Readers:

 Welcome to the Winter 2006 issue of Financial Decisions. We continue to work hard to continuously improve the quality of the journal and, thanks largely to your willingness to submit quality manuscripts; the work that we publish continues to be of very high quality. For this issue of the Journal, I have selected four excellent manuscripts that I hope that you will find beneficial. 

• The first manuscript, “Valuation of Lease Contracts In Continuous Time With Stochastic Asset Values,” Uses contingent-claim analysis to evaluate different lease contracts and shows that the value of the lease depends upon the options embedded in the lease contract..

• The second manuscript, “Stochastic Interest Rates and Short Maturity Currency Options” examines the ability of the jump-diffusion models to explain systematic deviations in implicit distributions from the benchmark assumption of lognormality.

· The third manuscript, “Another Evidence of Chronic Bias in Earnings Forecasts: The Case of South Korea,” is an outstanding article that investigates the chronic bias in analysts’ earnings forecasts for South Korean firms before and after the 1997 economic crisis.

• The final manuscript in this issue, “Multi-period Efficient Frontiers and Sharpe Ratios under the Buy and Hold and the Rebalancing Strategies,” analyzes and compares multi-period efficient frontiers and Sharpe Ratios under Buy and Hold and Rebalancing strategies and shows that the single-period capital market line preserves its linearity in the multi-period case under Buy and Hold, whereas it becomes a concave curve under Rebalancing.

I sincerely hope that you find the manuscripts published in Financial Decisions interesting and useful. I also hope that you will continue to submit your research to us for evaluation, and look forward to many outstanding manuscripts.

Sincerely,

Ronnie J. Clayton
Editor, Financial Decisions
Eminent Scholar and Professor of Finance
Jacksonville State University