As investors rely on multiple sustainability signals when assessing a fund, the alignment among those signals matters. As the regulatory framework evolves, we examine whether SFDR classifications become more coherent with other investor-facing signals, including ESG risk, SDG alignment, carbon intensity, governance indicators, and the Towards Sustainability label. The analysis covers UCITS funds marketed to Belgian investors from 2021 to 2025. We find mixed and complex results: coherence is clearer in the later regulatory phases, but not across the board. Results vary by indicator, asset class, and SFDR threshold. Reclassification results are uneven as well, with the clearest pattern observed for upgrades from Article 6 to Article 8. The longitudinal models reveal a stronger association between ESG and SDG characteristics and a higher SFDR positioning at the end of the phase. This is primarily during the Early and Post-clarification periods. The reverse association between SFDR evolution and subsequent ESG positioning is weaker and sensitive to baseline ESG persistence. Carbon and governance results show a similar asymmetric pattern. These findings support a qualified and asymmetric co-evolution interpretation, with temporal associations indicating that SFDR classifications and external sustainability signals are related over time rather than evolving entirely independently. Overall, SFDR classifications seem to be settling into a broader set of sustainability signals. What they contribute depends on the measure, the asset class, and the classification threshold. Clearer categories alone may therefore not be enough for reform if they do not align sufficiently with the other sustainability signals available to market participants.
This study investigates the firm-level determinants of biodiversity risk exposure in firms within the United States of America (USA) between 2015 and 2023. The model is developed using organizational ecology theory and the strategic choice perspective which proposes multiple dimensions of variables. These dimensions include structural characteristics, environmental performance, a green business model, governance mechanisms, and sustainability commitments to predict risk exposures. This study uses multiple estimation approaches including rare-event logit, Bayesian logit, and machine-learning logit model. This approach helps to address identification challenges in complex relationships. The findings are partially aligned with theoretical predictions. Out of a total of nine proposed hypotheses, three were not supported. The structural characteristics behaved as organizational ecology predicts while environmental performance, Environmental Social Governance (ESG), and a green business model show a positive effect contrary to strategic choice expectations. The findings provide key implications for multiple stakeholders. For lenders, the findings reveal a misalignment between conventional indicators and firm characteristics suggesting a need for recalibration. This model can help in reducing the systemic underpricing of biodiversity risks. This study contributes to the biodiversity finance literature using a comprehensive analysis of United States (US) firms and the integration of theoretical perspectives.
This study examines the behavior of leveraged Treasury exchange traded ETFs (TMF, TMV, and UBT) to determine if their daily drift and long-run performance can be explained by traditional measures of volatility. By evaluating the divergence between daily target leverage and long-term wealth accumulation, we find that these ETFs achieve near perfect daily tracking. Unfortunately, this short-term daily tracking feature appears to mask a persistent hidden tax of structural decay. Regression results reveal a total disconnect from financial theory where common volatility measures explain virtually none of the variation in daily drift as suggested by the consistently low R2 values. These findings contradict traditional models of volatility drag suggesting that investors cannot rely on daily volatility metrics to quantify risk. Conversely, the erosion of wealth (compounding decay) is driven by the specific path-dependent sequence of daily returns where the daily rebalancing mechanics are effectively designed to hide long-term erosion behind short-term market swings. As a result, we conclude that these structural flaws of daily rebalancing render leveraged Treasury ETFs unsuitable for buy-and-hold investors.
ESG-investors reallocate capital based on sustainability criteria, resulting in reshaped ownership structures and financing conditions. This study examines how these shifts impact the ownership structure of publicly listed firms and their likelihood of delisting. Using a comprehensive dataset of 24,788 funds managing USD 24 trillion in assets and 5699 stocks, we identify conventional investment funds and investment companies, such as private equity funds, as the main “counterparts” to ESG-investors. Furthermore, we find that firms with low ESG-investor ownership are more likely to be delisted, especially through private equity buyouts. These findings highlight the broader, unintended consequences of ESG-driven capital allocation.
This paper investigates Magic: The Gathering (MTG) trading cards as a modern class of emotional assets and evaluates their role within diversified portfolios. We construct an equally weighted index of 117 high-value “blue-chip” cards over October 2010-March 2025 and examine its interaction with traditional asset classes using monthly log returns and portfolio performance analysis. The MTG index displays near-zero correlations with equities, bonds, and gold, and delivers high average returns with volatility comparable to equities. When incorporated into a diversified allocation, even moderate exposure improves risk-adjusted performance, reduces maximum drawdown, and shifts the distribution of 12-month forward returns upward. Factor regressions using the Fama-French Three-Factor Model confirm limited systematic market exposure and a significant alpha component. Beyond financial performance, MTG cards exemplify the dual consumption-investment logic of emotional assets: they generate measurable returns while providing non-transferable “emotional dividends” linked to cultural meaning, nostalgia, and community embeddedness. The findings suggest that modern trading cards occupy an intermediate position between traditional collectibles and digital gaming assets, reflecting an ongoing process of assetization that bridges cultural and financial logics, while simultaneously raising challenges related to liquidity, authenticity, and issuer governance.
