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1 – 10 of 104It is important to note that insider trading is currently outlawed under the Securities Act 17 of 2004 (Chapter 24: 25) as amended (Securities Act) in Zimbabwe. This Act…
Abstract
Purpose
It is important to note that insider trading is currently outlawed under the Securities Act 17 of 2004 (Chapter 24: 25) as amended (Securities Act) in Zimbabwe. This Act enumerates some practices that may give rise to insider trading liability in the Zimbabwean financial markets. Nonetheless, numerous challenges, such as the lack of adequate financial resources, the lack of sufficient persons with the relevant skills and expertise on the part of the enforcement authorities, lack of political will, inadequacy of insider trading provisions, poor cooperation and collaboration between the relevant authorities and the ongoing coronavirus (Covid-19) pandemic have negatively impeded the effective regulation and combating of insider trading in Zimbabwe. To this end, the author explores the stated challenges and recommend measures that could be used by regulatory bodies and other relevant enforcement authorities to enhance the regulation and combating of insider trading in the Zimbabwean financial markets. This study aims to enhance the detection and combating of insider trading in Zimbabwe.
Design/methodology/approach
A qualitative research methodology is used through the analysis of relevant legislation and case law.
Findings
It is hoped that the findings and recommendations made in this study will be considered by the Zimbabwean policymakers.
Research limitations/implications
The study does not use empirical research methodology.
Practical implications
The findings and recommendations made in this study could enhance the combating of insider trading activities in Zimbabwe.
Social implications
The study seeks to curb insider trading in the Zimbabwean financial markets and financial institutions in the wake of the covid-19 pandemic-related regulatory and enforcement challenges.
Originality/value
The study provides original research on the regulation and combating of insider trading activities in Zimbabwe.
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This study aims to explore the relationship between chief executive officer (CEO) power and stock price crash risk in India. Furthermore, it seeks to analyse how insider trades…
Abstract
Purpose
This study aims to explore the relationship between chief executive officer (CEO) power and stock price crash risk in India. Furthermore, it seeks to analyse how insider trades may moderate the impact of CEO power on stock price crash risk.
Design/methodology/approach
A study of 236 companies from the S&P BSE 500 Index (2014–2023) have been analysed through pooled ordinary least square (OLS) regression in the baseline analysis. To enhance the results' reliability, robustness checks include alternative methodologies, such as panel data regression with fixed-effects, binary logistic regression and Bayesian regression. Additional control variables and alternative crash risk measure have also been utilised. To address potential endogeneity, instrumental variable techniques such as two-stage least squares (IV-2SLS) and difference-in-difference (DiD) methodologies are utilised.
Findings
Stakeholder theory is supported by results revealing that CEO power proxies like CEO duality, status and directorship reduce one-year ahead stock price crash risk and vice versa. Insider trades are found to moderate the link between select dimensions of CEO power and stock price crash risk. These findings persist after addressing potential endogeneity concerns, and the results remain consistent across alternative methodologies and variable inclusions.
Originality/value
This study significantly advances research on stock price crash risk, especially in emerging economies like India. The implications of these findings are crucial for investors aiming to mitigate crash risk, for corporations seeking enhanced governance measures and for policymakers considering the economic and welfare consequences associated with this phenomenon.
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This study delves into the nuanced implications of short-sale constraints on stock prices within the context of stock market efficiency. While existing research has explored this…
Abstract
Purpose
This study delves into the nuanced implications of short-sale constraints on stock prices within the context of stock market efficiency. While existing research has explored this relationship, inconsistencies persist in their findings. The purpose of this study is to conduct a comprehensive review of literature to elucidate the reasons behind these disparities.
Design/methodology/approach
A systematic review of existing theoretical and empirical studies was conducted following the PRISMA method. The analysis centered on discerning the factors contributing to the divergence in projected stock prices due to these constraints. Key areas explored included assumptions related to expectations homogeneity, revisions, information uncertainty, trading motivations and fluctuations in supply and demand of risky assets.
Findings
The review uncovered multifaceted reasons for the disparities in findings regarding the influence of short-sale constraints on stock prices. Variations in assumptions related to market expectations, coupled with fluctuations in perceived information uncertainty and trading motivations, were identified as pivotal factors contributing to differing projections. Empirical evidence disparities stemmed from the use of proxies for short-sale constraints, varied sample periods, market structure nuances, regulatory changes and the presence of option trading.
Originality/value
This study emphasizes the significance of not oversimplifying the impact of short-sale constraints on stock prices. It highlights the need to understand these effects within the broader context of market structure and methodological considerations. By delineating the intricate interplay of factors affecting stock prices under short-sale constraints, this review provides a nuanced perspective, contributing to a more comprehensive understanding in the field.
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Credit Default Swap (CDS) trading alters equilibrium interactive monitoring of external corporate monitors due to a possible change in private lenders' incentive to monitor client…
Abstract
Purpose
Credit Default Swap (CDS) trading alters equilibrium interactive monitoring of external corporate monitors due to a possible change in private lenders' incentive to monitor client firms. This study explores how audit fees change in response to CDS trade initiation on client firms and how this effect is moderated by investor protection.
Design/methodology/approach
With 6,052 cross-country firm observations, the author conducts estimations in the systems dynamic general methods of moments framework.
Findings
The author documents that audit fees rise on average after CDS trade initiations with and/or without investor protection. Meanwhile, change in auditors' risk perception result in increased audit costs when CDS trade initiation and investor protection interact. The effect of CDS trading on audit fees remain after controlling for firm, audit, and auditor features are robust to different proxies of audit cost.
Practical implications
The need for firms in high investor protection jurisdictions to initiate CDS trade to implement policies in order to maximize their gains from investor protection activities to lessen the overall impact of any increased audit cost that may arise. Furthermore, CDS regulation may be strategically targeted to lessen the effect of increased audit costs on firms after initiation. This would ensure that the resulting increase in audit cost may not materially impact the cash or profitability position of such firms.
Originality/value
This study is distinct from previous ones by focusing on variation in private lenders incentive to monitor after CDS trade initiation after controlling for possible monitoring by short-term creditors. Given that monitoring is not costless for private lenders and CDS trading on their borrowers causes a change in this cost structure, the author documents how auditors react to such changes in incentive to monitor.
研究目的
信用違約互換交易會改變外部監督機制的均衡互動監測,這是因為私人貸款者去監控客戶公司的激勵可能有所改變。本研究擬探究審計費用如何改變,以應對向客戶公司進行的信用違約互換交易啟動;研究亦探討投資者保障、如何緩和上述的影響。
研究設計/方法/理念
我們透過6,052個穿越全國的企業觀察,進行了對系統動力廣義矩估計體系的估測。
研究結果
無論投資者保障存在與否,信用違約互換交易啟動必帶來審計費用一般的平均升高,我們已把這關聯記錄下來。同時,當信用違約互換交易啟動和投資者保障兩者互相影響時,審計員的風險認知的改變,是會導致審計費用增加的。若拔除公司和審計的影響,信用違約互換交易對審計費用的影響會保持不變;而且,就各個不同的審計費用代理權而言,審計員特點是牢固的。
實務方面的啟示
本研究的結果,確定了若公司屬高投資者保護管轄權的類別,則有需要去啟動信用違約互換交易來實施政策,其目的為能從投資者保障的行動中取得最大的收益,從而減弱審計費用的增加所帶來的全面影響。再者,信用違約互換的管理或許可戰略性地訂立目標,俾能減弱於啟動後,審計費用的上昇對公司帶來的影響;這或會確保審計費用的增加、不會對有關公司的貨幣頭寸或盈利狀況產生重大的影響。
研究的原創性/價值
本研究有別於從前的研究,因它的焦點在於短期債權人可能的監督的影響給拔除的情況下,在信用違約互換交易啟動後,以監督為目的私人貸款者激勵的變化。鑒於對私人貸款者來說,監督不是不需要成本的;而且,為他們的借貸者的信用違約互換交易會為這個成本結構帶來變化,我們記錄了審計員如何對以監督為目的的激勵的有關改變作出回應。
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Bas Becker and Carel Roessingh
Multisited ethnography has primarily been portrayed as a challenge for the following field-worker, with the researcher taking the central role and neglecting research participants…
Abstract
Purpose
Multisited ethnography has primarily been portrayed as a challenge for the following field-worker, with the researcher taking the central role and neglecting research participants also experiencing a multisited nature of their work. The authors argue that literature on multisited ethnography merely discusses multisitedness as a methodological theme. In correspondence, the authors propose to think of multisitedness not just as a methodological theme but also as an empirical theme.
Design/methodology/approach
The authors contend etic and emic perspectives to address multisitedness empirically, which enables researchers to compare and contrast the multisited topic of inquiry in academic “outsider” terms with the etic analysis and considering the perspective of the research participants' multisited experiences using the emic perspective. To show the fruitfulness of discussing multisitedness using the complementary etic and emic analysis, the authors present the example of Mennonite entrepreneurial activities in Belize, a heterogeneous group of migrants that established themselves as successful traders and entrepreneurs.
Findings
Through an etic multisited ethnographic perspective, the authors compare and contrast four communities of Mennonites in terms of their entrepreneurial activities, technology and energy use. Through an emic perspective, the authors demonstrate how Mennonites, while preferring an in-group focus, navigate their multisited entrepreneurial activities, which require interaction with the outside world.
Originality/value
The authors highlight the value of combining etic–emic reflections to acknowledge and include the multisited nature of many social phenomena as experienced by the research participants.
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Tapas Kumar Sethy and Naliniprava Tripathy
This study aims to explore the impact of systematic liquidity risk on the averaged cross-sectional equity return of the Indian equity market. It also examines the effects of…
Abstract
Purpose
This study aims to explore the impact of systematic liquidity risk on the averaged cross-sectional equity return of the Indian equity market. It also examines the effects of illiquidity and decomposed illiquidity on the conditional volatility of the equity market.
Design/methodology/approach
The present study employs the Liquidity Adjusted Capital Asset Pricing Model (LCAPM) for pricing systematic liquidity risk using the Fama & MacBeth cross-sectional regression model in the Indian stock market from January 1, 2012, to March 31, 2021. Further, the study employed an exponential generalized autoregressive conditional heteroscedastic (1,1) model to observe the impact of decomposed illiquidity on the equity market’s conditional volatility. The study also uses the Ordinary Least Square (OLS) model to illuminate the return-volatility-liquidity relationship.
Findings
The study’s findings indicate that the commonality between individual security liquidity and aggregate liquidity is positive, and the covariance of individual security liquidity and the market return negatively affects the expected return. The study’s outcome specifies that illiquidity time series analysis exhibits the asymmetric effect of directional change in return on illiquidity. Further, the study indicates a significant impact of illiquidity and decomposed illiquidity on conditional volatility. This suggests an asymmetric effect of illiquidity shocks on conditional volatility in the Indian stock market.
Originality/value
This study is one of the few studies that used the World Uncertainty Index (WUI) to measure liquidity and market risks as specified in the LCAPM. Further, the findings of the reverse impact of illiquidity and decomposed higher and lower illiquidity on conditional volatility confirm the presence of price informativeness and its immediate effects on illiquidity in the Indian stock market. The study strengthens earlier studies and offers new insights into stock market liquidity to clarify the association between liquidity and stock return for effective policy and strategy formulation that can benefit investors.
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The authors examine the effect of split environmental, social and governance (ESG) ratings on information asymmetry, corporate value and trading behavior. The authors test the…
Abstract
The authors examine the effect of split environmental, social and governance (ESG) ratings on information asymmetry, corporate value and trading behavior. The authors test the risk-based hypothesis and the optimism-bias hypothesis on the relationship between diverging opinions and future stock prices. The authors results show that split ESG ratings is positively related to idiosyncratic volatility, an alternative measure for information asymmetry. Further, the negative effect of split ESG ratings on cumulative abnormal return under short-selling constraints is consistent with the optimism bias hypothesis. The authors find a negative relationship between split ESG ratings and the net purchase ratio (NPR) of pension funds. Considering that the NPR is a direct measure of net demand, ESG disagreement may hinder socially responsible investing (SRI) in a firm. This study directly demonstrates the negative effect of ESG disagreement on firm value and investment by Korea's National Pension Service (NPS). The results offer valuable insights into policymakers, as the wide divergence in ESG ratings requires urgent attention to expand SRI.
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This research proposes a framework to conceptualise the potential realm of data regarding shipping connectivity for application of data analytics which can be used to generate…
Abstract
Purpose
This research proposes a framework to conceptualise the potential realm of data regarding shipping connectivity for application of data analytics which can be used to generate deeper insights with respect to the state of such linkages and potential areas for practical application.
Design/methodology/approach
The study method involved comprehensive presentation of different perspectives of assessing shipping connectivity and levels of data contained within container shipping services and proposed potential application to analyse profitability, performance, competitiveness, risk and environmental impact.
Findings
Advances in capabilities to handle large volumes of data offer scope for an integrated approach which utilises all available data from various stakeholders in analyses of liner shipping connectivity. Research shows how different types of data contained in container shipping services are related and can be organised for application of data analytics.
Research limitations/implications
Research implications are offered to shipping lines, port managers and operators and policymakers.
Practical implications
This research presented a conceptual framework that captures the range of data involved in container shipping services and how data analytics can be practically applied in an integrated manner.
Originality/value
This paper is the first in literature to discuss in detail the different levels of data that reside within shipping services that constitute liner shipping connectivity for application of data analytics.
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Özgür İcan and Taha Buğra Çelik
The economic and administrative conditions of countries normatively have an effect on the economy and level of market development. Moreover, it is of great importance for a…
Abstract
Purpose
The economic and administrative conditions of countries normatively have an effect on the economy and level of market development. Moreover, it is of great importance for a healthy economy whether the public institutions and organizations are transparent and functioning in accordance with their purpose. The aim of this study is to show whether there is a relationship between transparency and market efficiency.
Design/methodology/approach
Correlation analysis has been conducted between prediction accuracy rates, which are obtained by seven different machine learning algorithms and Corruption Perception Index (CPI) levels.
Findings
It has been statistically shown that the indices of countries with low corruption levels are harder to predict, which, in turn, can be interpreted as having higher weak-form market efficiency. According to that, an intermediate negative correlation has been found between CPI scores and predictability levels of stock indices. Considering the findings, it can be interpreted that the markets of countries with relatively more transparent and well-functioning public sector have more weak-form market efficiency.
Research limitations/implications
The study can be extended with cutting-edge machine learning and deep learning techniques in future studies. There are very few studies which try to explain factors related to market efficiency. Thus, the authors claim that there is still room for further research in order to determine the factors related to market efficiency, implying that current literature is still far from explaining the causation behind the inefficiencies.
Practical implications
According to findings, the markets of countries with relatively more transparent and well-functioning public sector have more weak-form market efficiency. Based on these findings, in practice, it can be said that more successful predictions can be made using machine learning algorithms in countries with relatively lower CPI scores.
Originality/value
In literature, the factors related to market efficiency are still far from explaining the causation behind the inefficiencies. Thus, it has been investigated whether transparent and well-functioning public institutions and organizations have any relation with market efficiency.
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