This paper examines whether post-earnings-announcement drift (PEAD) in the Koeran Stock Market is a consequence of the risk premium for omitted latent risk factors or of systematic mispricing from investors' delayed response to earnings news. To examine whether PEAD is still prominent after adjustment for risk factors, we form portfolios (SUE1~SUE4) sorted on standardized unexpected earnings (SUE). We find that value-weighted average excess raw returns and cumulative abnormal returns tend to monotonically increase across SUE portfolios. Further, the difference in average excess return between highest and lowest SUE portoflios (i.e., SUE4−SUE1), which is the return of the SUE-based zero-investment strategy, is positive and statistically significant. We also find that riskadjusted abnormal returns, which are computed from the well-known three models (i.e., CAPM, Fama-French three-factor model, and Fama-French five-factor model), still show a monotonic increasing pattern across SUE portfolios. The difference in abnormal return between highest and lowest SUE portfolios is also positive and statistically significant. Therefore, these results indicate that it is difficult to argue that PEAD is a consequence of the risk premium for omitted risk factors in the Korean stock market. We also examine the effect of limits-to-arbitrage on PEAD, and find that as the degree of limits-to-arbitrage is more profound, the degree of the drift is more prominent. That is, the difference, SUE4−SUE1, tends to increase in magnitude and statistical signiciance with the degree of limits-to-arbitrage. Furthermore, the difference in SUE4-SUE1 between the most and least severe limits-to-arbitrage portfolios (i.e., difference-indifference) is positive and statistically significant. These results indicate that PEAD is more profound as limits-to-arbitrage becomes more severe. In summary, this paper provides evidence supporting the arguments that PEAD in the Korean stock market may be a consequence of delayed response to unexpected earnings news due to limits-to-arbitrage, rather than a manifestation of the risk premium for omitted latent risk factors. To our knowledge, this paper is the first in the literature in Korea that comprehensively evaluates the two explanations for PEAD.

Cordyceps militaris is being studied and cultivated as a medicinal mushroom having many valuable biological and pharmaceutical activities. In the breeding of new C. militaris mushroom, single ascospores were isolated and examined their mycelial growth, mycelial density, and production of stroma and perithecia. Among them selected isolates were crossed and hybrids were produced showing high quality fruiting bodies on artificial media. Mycelial growth rate of new strain 'Dowonhongcho' was higher than that of better on 'Yedang 3' on SDAY at 10-25 o C. The stromata of new strain were clubshaped and bright orange-red. Its height was 6.1 cm and the cordycepin content was 0.34% on average. The new strain showed 9% higher yield than 'Yedang 3' with producing firmer fruit bodies. The optimum temperature for mycelial growth was 22~25 o C and the optimum temperature for stroma development was 18~22 o C. Fruiting bodies were began to produce 45 days later after inoculation. This new cultivar may serve as a valuable one for artificial cultivation and industrial-scale production of C. militaris.

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