Dr. Zhaojun Yang is a vice dean and an associate professor for finance of the Department of Finance in the Southern University of Science and Technology, an appointment he has held since April 2016. He has been awarded the title of Pengcheng Scholar, of High-Level Talent in Shenzhen, and of High-Level Talent in Nanshan District of Shenzhen. Prior to the current position, he was a full Professor at Hunan University since 2002. He was the supervisor of a distinguished Doctoral Dissertation in Hunan Province and received an Outstanding Researcher Award in Hunan University. He visited the University of Leeds from July 2005 to July 2006, Columbia Business School at Columbia University from September to October 2010 and from February to August 2014, and the university of Macau from October to November 2015. He has received many research grants, including one (2006) supported by National Social Science Foundation and three (2009, 2011, 2013) by National Natural Science Foundation of China. His research focuses on finance theory and financial engineering, including optimal portfolio choice, capital asset pricing, pricing of derivative securities, credit risk, loan guarantees and financial innovation. Dr Yang has published more than 140 peer-reviewed papers in economics, finance and management journals. Since 2013, the journals where he published papers include the Journal of Credit Risk, Macroeconomic Dynamics, Journal of Economic Dynamics and Control, International Review of Finance, Journal of Mathematical Economics, European Journal of Operational Research, Quantitative Finance, North American Journal of Economics and Finance, Economics Letters among others.
This paper considers an entrepreneur who has no assets in place but possesses an option to invest in a project incurring a lump-sum investment cost, of which a fraction must be financed by entering into an equity-for-guarantee swap.