Airport finance

The University of Texas at Arlington News Releases

Shivam Arora, a UTA graduate student, won an FAA grant in which he will develop factor models for fixed-income securities issued by airport-affiliated entities in the United States.

The $12,000 fellowship funds those seeking to conduct applied research in public-sector airport-related aviation issues. The Federal Aviation Administration awards the grants and selects 10 outstanding masters or doctoral students nationally each year.
Arora plans to develop factor models for fixed-income securities issued by airport-affiliated entities in the United States. Inspired by a factor-based investing method that won Eugene Fama a Nobel Peace Prize in Economic Sciences in 2013, Arora will utilize the grant to apply similar explanatory models normally reserved for stocks and public funds to the bond market as it relates to airports over the next year.
He will then present his findings at the Transportation Research Board’s annual meeting in Washington, D.C., in January 2020. The TRB is part of The National Academies of Sciences, Engineering, and Medicine. The board promotes innovation and progress in transportation through interdisciplinary research.
According to this August 2018 article by The Economist, “factor investing for bonds is still so new that many investors have not even heard of it,” which makes this proprietary analysis exciting for Arora.
“Little research has been done on this and it’s helpful for investors and government entities because it could be a potential game changer that influences how airports take up financing and better track factors for ideal times to issue bonds,” Arora said. “Research in business is much needed but rare, especially at the collegiate level, and the discipline offers a scope for conducting quality research that has an impact on society and industry.”
Arora’s faculty mentor, David Rakowski, associate professor of finance, will be overseeing his research and has worked with him before. Arora completed and published his honors senior thesis under guidance from Rakowski. During his …

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