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1 – 10 of over 16000C. Edward Chang, Thomas M. Krueger and H. Doug Witte
For a number of reasons ranging from their more recent introduction to their perceived lesser excitement relative to stock-based peers, there have been few studies of fixed income…
Abstract
Purpose
For a number of reasons ranging from their more recent introduction to their perceived lesser excitement relative to stock-based peers, there have been few studies of fixed income (mainly bond) exchange-traded funds (ETFs). The purpose of this paper is to fill the void by comparing performance measures of fixed income ETFs to fixed income closed-end funds (CEFs).
Design/methodology/approach
This paper examines operating characteristics as well as risk and performance measures of all available fixed income ETFs and CEFs in the USA over the last five and ten years ending on December 31, 2014. Operating characteristics include expense ratios, annual turnover rates, tax cost ratios, and tracking error ratios. Performance measures include average annual returns, risks (measured by standard deviations), and risk-adjusted returns (measured by Sharpe ratios and Sortino ratios).
Findings
This study finds material and significant difference in a variety of expenses, return measures, and risk measures. Sharpe and Sortino ratio significance is highly dependent on whether net asset values or market values serve as the dependent variable. ETFs would be the preferred choice of fixed income investors who are presumed to be focussing on market-based return measures.
Originality/value
This paper empirically compares operating characteristics as well as risk and performance measures of US fixed income ETFs and fixed income CEFs in the same Morningstar categories over the last five and ten years.
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Keywords
Michael S. Bennett and Zamir Iqbal
Islamic finance and socially responsible investing (SRI) have been two of the most rapidly growing areas of finance over the last two decades. During this period, they have each…
Abstract
Purpose
Islamic finance and socially responsible investing (SRI) have been two of the most rapidly growing areas of finance over the last two decades. During this period, they have each grown at rates that far exceed that of the financial markets as a whole. The purpose of this paper is to find similarities and commonalities of both markets and identifies how both could benefit from each other.
Design/methodology/approach
The paper takes a comparative approach in comparing and contrasting two markets. The paper reviews the progress and driving forces in both markets and makes policy recommendations.
Findings
Islamic finance has grown at a very impressive rate over the last two decades, but the Islamic fixed income market remains under‐developed. SRI has become an increasingly common investment strategy during that same time period, but there is still insufficient supply of SRI fixed income instruments. The convergence of these two facts creates the opportunity for a fixed income product to be developed that could appeal to both SRI and Shariah (Islamic Law) compliant investors, and thereby serve as a bridge between the Islamic and conventional financial markets. The paper believes the product that could play this role is Sukuk for which the proceeds are used to fund economic development.
Research limitations/implications
The paper takes a view from a financial expert's point of view which could be different from the scholars of Islamic legal system.
Practical implications
The paper provides an innovative view to two different markets and suggests that there are commonalities which need to be exploited for the benefit of both markets.
Originality/value
This is probably the first known attempt to related SRI financing to Islamic financing particularly Islamic capital markets.
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Thomas S. Howe, Vladimir Kotomin, Min-Yu (Stella) Liao and Abhishek Varma
The purpose of this paper is to document and compare the characteristics of two student-managed investment funds at the University.
Abstract
Purpose
The purpose of this paper is to document and compare the characteristics of two student-managed investment funds at the University.
Design/methodology/approach
This study uses a case study approach to achieve this purpose.
Findings
Consistent with other studies, this study finds considerable differences in funding, oversight and the structure of the courses in which the students manage the portfolios. This is the case even though the portfolios are managed by students in courses offered by the same department at the same university.
Originality/value
This study presents different possible ways of obtaining funds and structuring courses in which the students manage investment portfolios.
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Saqib Sharif, Sarwat Ahson and Hina Noor
This case serves as a useful backdrop for discussing a few important conceptual frameworks in the field of finance. The dilemmas are still evolving for Sharīʿah-compliant asset…
Abstract
Learning outcomes
This case serves as a useful backdrop for discussing a few important conceptual frameworks in the field of finance. The dilemmas are still evolving for Sharīʿah-compliant asset management company (AMC); i.e. Al Meezan, and may seem complex to the students – particularly in the Pakistan’s financial structure – but framing the discussion from a market perspective ought to help the students of finance.
Case overview/synopsis
This case study focuses on Al Meezan Investment Management Limited (Al Meezan) journey since inception. Al Meezan is a full-fledged Sharīʿah-compliant AMC and one of the major players in the mutual funds industry of Pakistan. Al Meezan offers a comprehensive range of Sharīʿah-compliant investment solutions especially designed to meet the financial goals of their existing and potential clients. The case study covers all the key events before the inception of Al Meezan, from late 1990s till March 2020. The case is based on interview with chief executive officer (CEO) (the protagonist) of Al Meezan. The case also covers various challenges faced by Mohammad Shoaib, CEO and his senior team, to make Al Meezan a vibrant institution offering Islamic financial services.
Complexity academic level
This case is aimed at undergraduate students in their final year (i.e. taking electives in the field of Finance/Islamic Finance) or graduate students majoring in Finance/Islamic Finance.
Supplementary materials
Teaching notes are available for educators only.
Subject code
CSS1: Accounting and Finance.
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Harish Kumar Singla and Amit Hiray
The purpose of this paper is to find the effect of the hedonism value on the investment preference in India.
Abstract
Purpose
The purpose of this paper is to find the effect of the hedonism value on the investment preference in India.
Design/methodology/approach
Based on the literature review, a measurement model is developed to measure hedonism. Further, the effect of hedonism on investment choices of an individual and the impact of age, gender and income level on investment choices and on hedonism are also measured through a structural equation model (SEM).
Findings
The study finds that the measurement model is reliable, and all five items, that is an exciting life, happiness, pleasure, social recognition and a comfortable life, are an appropriate measure of hedonism. The study finds that hedonists prefer to invest in stock market-related instruments and real estate. The study also ascertains that age and income affect the hedonism value negatively. The findings also indicate that women prefer to invest in fixed income instruments and men prefer to invest in stock market-related instruments. As people grow in age, they prefer to invest in fixed-income instruments and gold as a hedge, thus avoiding risky investments.
Research limitations/implications
The study does not include education and financial literacy of individuals in the model, rather controls these factors by selecting a sample where the minimum educational qualification of the respondent is graduation.
Practical implications
It is assumed that the values that drive an individual have the potential to influence his/her investment choices. Therefore, the study advises the firms offering investment services to their clients to ensure that apart from studying the demographic and risk profile of individuals, they also assess their value system. This can help them target their customers more precisely and serve them better.
Originality/value
The study is perhaps the first attempt to find the effect of personal values (specifically hedonism) on investment choices made by individuals, through the development of an SEM.
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Gyorgy Varga and Maxim Wengert
This chapter describes the evolution of the Brazilian investment fund industry and the impact of domestic and international crises on investors, managers and the main types of…
Abstract
This chapter describes the evolution of the Brazilian investment fund industry and the impact of domestic and international crises on investors, managers and the main types of funds offered in Brazil. In particular, it explores the effect of the subprime crisis and shows that the first wave of this crisis had very little impact, but the second wave with the collapse of Lehman Brothers did have a major impact on risk, returns and flows of the mutual fund industry in Brazil.
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Peter Ammermann, Pia Gupta and Yulong Ma
The student-managed investment fund (SMIF) program at California State University, Long Beach (CSULB), was launched in 1995 with one portfolio worth $50,000. In the two decades…
Abstract
Purpose
The student-managed investment fund (SMIF) program at California State University, Long Beach (CSULB), was launched in 1995 with one portfolio worth $50,000. In the two decades since then, the program has grown to include three portfolios with a combined value of more than $700,000, managed on behalf of three different clients. The purpose of this paper is to describe the creation, evolution and growth of the program including the development of the new quantitative approach and its subsequent implementation. The paper also discusses the ongoing organizational, educational and investment-management challenges associated with the program.
Design/methodology/approach
The paper includes a description of the development and evolution of the program along with a discussion of the investment results for one of its three portfolios.
Findings
The paper finds: the new quantitative approach implemented in the program is effective as insurance against “black swan” events; and SMIF-type programs can provide learning experiences both for students and faculty members.
Practical implications
The paper explains the practical application of the new quantitative approach as well as the educational benefits of a SMIF-type program.
Originality/value
The paper provides insight into the structure of CSULB’s SMIF program and discusses a unique quantitative approach to asset allocation and security selection.
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