J Curve

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J Curve

1. In charting, the theoretical trend of a country's trade balance after the devaluation of its currency. After a devaluation in currency, there is often a slight increase in the trade deficit, but the long-term effect is a trade surplus due to the fact that a good sold in a devalued currency makes a good less expensive for international buyers. This is represented graphically as a curve that briefly dips below the x-axis, representing time, before turning upwards, resembling the letter J. On this graph, the y-axis represents the trade balance.

2. In equity funds, the theoretical trend of the internal rate of return over several years. Most funds operate at a loss at their beginning, due in part to their start-up costs. Later, if the fund is successful, the internal rate of return rises significantly. This is represented graphically as a curve that briefly dips below the x-axis, representing time, before turning upwards, resembling the letter J. On this graph, the y-axis represents the internal rate of return.
References in periodicals archive ?
This is somewhat consistent with the delayed J-curve phenomenon.
Kulkarni (1994) found the evidence of the J-curve phenomenon for Egypt and Ghana.
He focused on diastolic pressure because that is the pressure that perfuses the myocardium, and inadequate myocardial perfusion probably causes the J-curve phenomenon.
He focused on diastolic pressure because that is what perfuses the myocardium, and inadequate myocardial perfusion probably causes the J-curve phenomenon.
The results confirm the existence of the j-curve phenomenon for Pakistan.
Accordingly, there has been a major shift toward using disaggregated data while investigating the J-Curve phenomenon.
Considering the magnitude of this crisis and its potential impact on Korean trading patterns as well as implications for the J-Curve phenomenon.
Testing the J-Curve phenomenon requires estimation of the short-run dynamics (the error-correction model) of the model.
The results revealed that J-curve phenomenon exists in all oil importing countries of the group.
Keywords: J-Curve Phenomenon, Oil Price Shock, D-8, Vector Auto Regression
As a first step the existence of Marshal-Lerner condition and J-Curve phenomenon is explored for each country.
For one thing, growing evidence suggests the long-debated J-curve phenomenon does exist and that drug regimens that reduce blood pressure to 120-125/70-75 mm Hg or below may be accompanied by an increase in coronary events.