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Article
Publication date: 23 May 2018

Muhammad Rizky Prima Sakti, Mansur Masih, Buerhan Saiti and Mohammad Ali Tareq

The purpose of this paper is to examine the extent to which the Indonesian Shariah compliant investors can benefit from the portfolio diversification with the Islamic indices of…

Abstract

Purpose

The purpose of this paper is to examine the extent to which the Indonesian Shariah compliant investors can benefit from the portfolio diversification with the Islamic indices of its trading partners and selected commodities such as gold, crude oil, and cocoa.

Design/methodology/approach

The authors use daily time series data covering both Islamic and commodity indices starting from June 4, 2007 until December 30, 2016 by the application of multivariate-generalized autoregressive conditional heteroscedastic and continuous wavelet analysis.

Findings

The findings tend to indicate that investors with exposure in Shariah compliant indices of Indonesia and wanting to gain more diversification benefits should invest either in the USA or India Islamic equity. Instead, the greater benefits will be obtained by Shariah compliant investors if they invest in the USA Islamic indices during long-term investment horizons. If investors want to invest in medium investment horizons, investing in India Islamic equity is a viable option. The findings further suggest that gold has a role of diversification benefits as a “safe haven” instrument for investors. It is advisable for the investors that have exposure in commodities (gold, crude oil, and cocoa) and want to invest in Indonesian Islamic equity, they should hold the portfolio for not more than 16 days to gain diversification benefits.

Originality/value

The results of this study are expected to have crucial implications for the Indonesia Shariah compliant investors and portfolio managers because it will help them to understand portfolio diversification benefits with different stock holding periods or investment horizons.

Details

Managerial Finance, vol. 44 no. 6
Type: Research Article
ISSN: 0307-4358

Keywords

Article
Publication date: 9 July 2018

Rasidah Mohd-Rashid, Mansur Masih, Ruzita Abdul-Rahim and Norliza Che-Yahya

The purpose of this study is to identify selected information from the prospectus that might signal the initial public offering (IPO) offer price.

Abstract

Purpose

The purpose of this study is to identify selected information from the prospectus that might signal the initial public offering (IPO) offer price.

Design/methodology/approach

This study uses cross-sectional data for a 14-year period from 2000 to 2014 in examining hypotheses relating to Shariah-compliant status, institutional investors, underwriter ranking and shareholder retention, with respect to their associations with the offer price of the IPOs. Further, this study uses ordinary least squares (OLS) for all models, including the models for both subsamples of Shariah- and non-Shariah-compliant IPOs. As for robustness, this study incorporates the quantile regression and quadratic model.

Findings

The results tend to provide support for the argument that firms with Shariah-compliant status reflect lower uncertainty and project better signalling of quality due to greater scrutiny by the government and thus are able to offer IPOs at higher prices. Similarly, firms with a higher proportion of shareholder retention indicate lower risks as insiders forego their options to diversify their portfolio, and hence could price their IPOs higher. Finally, the involvement of institutional investors and higher underwriter ranking could be used by firms to disregard information asymmetry, and therefore, the issuer might have to discount the IPO offer price.

Research limitations/implications

This study focuses solely on information in the prospectus that should not be disregarded by the investors in valuing the appropriateness of the IPO offer price. This study contributes in terms of providing a better understanding of the determinant factors of the IPO offer price of the firms which are Shariah-compliant.

Originality/value

This paper provides evidence for the determinants of the IPO offer price in a fixed pricing mechanism for both Shariah-and non-Shariah-compliant IPOs.

Details

Journal of Islamic Accounting and Business Research, vol. 9 no. 4
Type: Research Article
ISSN: 1759-0817

Keywords

Article
Publication date: 17 December 2018

Md Hakim Ali, Md Akther Uddin, Mohammad Ashraful Ferdous Chowdhury and Mansur Masih

On the backdrop of growing importance of Shariah compliant equity markets, the purpose of this paper is to study cross-country portfolio diversification benefits for investors…

Abstract

Purpose

On the backdrop of growing importance of Shariah compliant equity markets, the purpose of this paper is to study cross-country portfolio diversification benefits for investors with major trading partners of Saudi Arabia, namely, USA, China, Japan, Germany and India, who have already invested or tend to invest in Saudi Arabian stock market.

Design/methodology/approach

The authors have investigated time invariant, dynamic correlations at different investments horizons of the investors among Islamic asset classes by applying relevant econometric techniques like multivariate generalized autoregressive conditional heteroscedastic –DCC and continuous wavelet transforms. For robustness, this study also applied maximal overlap discrete wavelet transform.

Findings

The findings tend to indicate that the Saudi Arabian investors have portfolio diversification benefits with all major trading partners in the short-term investment horizon. Interestingly, Saudi Arabian market has the least portfolio diversification benefits with the Chinese market. However, in the long run, all markets are correlated, yielding minimum portfolio diversification benefits and most importantly Saudi Arabian investors have portfolio diversification benefits with the Indian Islamic equity market in almost all investment horizons. The findings are highly consistent across different econometric technique estimations.

Research limitations/implications

The authors are only considering five major trading partners of Saudi Arabia. Also, the authors are using S&P and FTSE shari’ah index. Moreover, the time period of the study is constrained by the availability of shari’ah indices. Econometric limitations are also well documented in the literature.

Practical implications

The results could be beneficial for the investors, portfolio managers, hedge fund managers and institutional investors and also could be useful for the policy makers in their policy-making decisions.

Originality/value

Only very few studies have looked into the benefits of international portfolio diversification from the perspective of local investors as well as the portfolio diversification benefits with the major trading partners of Saudi Arabia. One of the novelties of the method is to make the stock investors, practitioners and policy makers aware of the portfolio diversification benefits available at different time scales such as 4, 8, 16, 32, 64 and 256 trading days as investment holding periods to unveil the true dynamics of co-movement between those different assets.

Details

Managerial Finance, vol. 45 no. 1
Type: Research Article
ISSN: 0307-4358

Keywords

Article
Publication date: 22 April 2020

Md Akther Uddin, Md Hakim Ali and Mansur Masih

This paper aims to study institutions, human capital and economic growth in developing countries.

Abstract

Purpose

This paper aims to study institutions, human capital and economic growth in developing countries.

Design/methodology/approach

The study applies dynamic system Generalized Method of Moments (GMM) and simultaneous quantile regression on a panel of 120 developing countries for the period of 1996-2014.

Findings

The findings show that human development and institutions do have a significant positive effect on economic growth. Interestingly, institutions and human development have a significant negative interactive effect on the economic growth of developing countries. This paper argues that incremental investment in human development would impact economic growth negatively in the presence of weak and dysfunctional institutions because additional stock tends to be employed in rent-seeking and socially unproductive activities.

Research limitations/implications

The policy makers should bear in mind the critical role played by the institutions and the initial stage of growth of a country in making their education and health policies more effective.

Originality/value

The most important novelty is the study of various transmission channels: political, economic and financial institutions through which human development affect economic growth in developing countries. This paper also studies the Islamic economic development concept and empirically investigates whether Muslim countries are different from their counterparts. Moreover, this study extends the existing empirical growth literature by simultaneously applying dynamic system GMM and quantile regression techniques.

Details

Studies in Economics and Finance, vol. 38 no. 2
Type: Research Article
ISSN: 1086-7376

Keywords

Article
Publication date: 10 February 2023

Roslina Mohamad Shafi and Yan-Ling Tan

This study aims to explore the evolution of the Islamic capital market (ICM) from the perspective of research publications.

Abstract

Purpose

This study aims to explore the evolution of the Islamic capital market (ICM) from the perspective of research publications.

Design/methodology/approach

A bibliometric analysis was applied based on selected publications from the Web of Science Core Collection (WoSCC) database from 2000 to 2021. The study adopted VOSviewer software which was developed by Leiden University.

Findings

This study has some implications that need urgent action. Firstly, there are some areas that have received little attention among researchers, although they are relevant to the industry, for instance, in fintech and blockchain in ICM. Secondly, the inconsistent frequency of publications in some niche areas may suggest that there are unprecedented events that hinder further research; probably, the researcher may anticipate more information and progress in the industry. Thirdly, the need to strengthen the collaboration between industry and academia to advance research.

Research limitations/implications

This study considered only the WoSCC database. The provider of WoSCC is Clarivate (formerly known as Thomson Reuters), where access to publications is limited to institutional subscribers. The implications of this study are to identify and propose future research trends in the field of ICM.

Originality/value

To the best of the authors’ knowledge, the present study is among the pioneer studies in analysing bibliometric focusing on ICM. Previous research has focused on Islamic finance and banking, and not specifically on ICM. Accordingly, this study sheds light on research gaps in ICM.

Details

Journal of Islamic Accounting and Business Research, vol. 14 no. 8
Type: Research Article
ISSN: 1759-0817

Keywords

Book part
Publication date: 14 December 2018

Ramazan Yildirim and Mansur Masih

The purpose of this chapter is to analyze the possible portfolio diversification opportunities between Asian Islamic market and other regions’ Islamic markets; namely USA, Europe…

Abstract

The purpose of this chapter is to analyze the possible portfolio diversification opportunities between Asian Islamic market and other regions’ Islamic markets; namely USA, Europe, and BRIC. This study makes the initial attempt to fill in the gaps of previous studies by focusing on the proxies of global Islamic markets to identify the correlations among those selected markets by employing the recent econometric methodologies such as multivariate generalized autoregressive conditional heteroscedastic–dynamic conditional correlations (MGARCH–DCC), maximum overlap discrete wavelet transform (MODWT), and the continuous wavelet transform (CWT). By utilizing the MGARCH-DCC, this chapter tries to identify the strength of the time-varying correlation among the markets. However, to see the time-scale-dependent nature of these mentioned correlations, the authors utilized CWT. For robustness, the authors have applied MODWT methodology as well. The findings tend to indicate that the Asian investors have better portfolio diversification opportunities with the US markets, followed by the European markets. BRIC markets do not offer any portfolio diversification benefits, which may be explained partly by the fact that the Asian markets cover partially the same countries of BRIC markets, namely India and China. Considering the time horizon dimension, the results narrow down the portfolio diversification opportunities only to the short-term investment horizons. The very short-run investors (up to eight days only) can benefit through portfolio diversification, especially in the US and European markets. The above-mentioned results have policy implications for the Asian Islamic investors (e.g., Portfolio Management and Strategic Investment Management).

Content available
Book part
Publication date: 14 December 2018

Abstract

Details

Management of Islamic Finance: Principle, Practice, and Performance
Type: Book
ISBN: 978-1-78756-403-9

Article
Publication date: 6 November 2017

Neha Seth and Monica Sighania

The purpose of this paper is to review and organize the status of research already conducted on financial market contagion so as to provide easy access to future researchers…

Abstract

Purpose

The purpose of this paper is to review and organize the status of research already conducted on financial market contagion so as to provide easy access to future researchers. Additional objective of the study is to classify the available literature and provide a complete bibliography on the subject and analyze the findings of the studies considered for review.

Design/methodology/approach

A number of resources were looked at to review the past literature and out of hundreds of papers, 104 research papers form the sample for the present study. These 104 research papers are further classified on the basis of various variables so as to know the status of research done on the topic.

Findings

This paper classifies the past research done on financial market contagion and found that the research work in this field has increased significantly during recent times, particularly between 2011 and 2015. Apart from the above finding, many other findings were revealed by the studies used for this paper.

Practical implications

This paper presents the concise view of available literature. It helps the future researchers with the same research interest. This is the major implication of such literature review paper.

Originality/value

This paper provides collection, classification and comprehensive bibliography on financial market contagion. This paper is surely going to be of great value for academicians, practitioners and future researchers who study the existing research work as well as for conducting future research in the same subject.

Details

Qualitative Research in Financial Markets, vol. 9 no. 4
Type: Research Article
ISSN: 1755-4179

Keywords

Article
Publication date: 1 December 2020

Muneer M. Alshater, M. Kabir Hassan, Ashraf Khan and Irum Saba

Islamic finance is an alternative approach of financial intermediation based on risk-sharing and asset-backed operations, which evolved substantially in recent years in academic…

1567

Abstract

Purpose

Islamic finance is an alternative approach of financial intermediation based on risk-sharing and asset-backed operations, which evolved substantially in recent years in academic research raising the need for quantitative studies to address the intellectual development and scientific performance of this field. This study aims to provide quantitative statistics and comprehensive review of the key influential and intellectual structure of Islamic finance literature.

Design/methodology/approach

The authors apply the trending and cutting-edge quali-quantitative approach of bibliometric citation analysis. This study reviews 1,940 English studies and review papers published in scientific journals indexed by the Scopus database from 1983 to 2019. RStudio, VOSviewer and Excel’s software are used to analyze the collected data and apply the bibliometric tests.

Findings

The results identify the leading academic authors, journals, institutions and countries with relation to Islamic finance. The authors also propose six main research themes in this field, which are as follows: Islamic finance – fundamentals, growth and legitimacy; customer’s attitude and perception toward Islamic finance; accounting and social reporting of Islamic finance; performance and risk management of Islamic finance; Islamic financial markets; and efficiency of Islamic financial institutions. Lastly, the authors identify research gaps in the existing Islamic finance literature and present 24 future research directions.

Research limitations/implications

The data in this study is confined only to the Scopus database of English papers and reviews. It also considers papers directly related to the field of Islamic finance.

Originality/value

To the best of the authors’ knowledge, this paper is one of the first to address the literature of Islamic finance from a bibliometric aspect. The results of this study along with future research questions will help researchers and practitioners to further explore and stand on firm quantitative bases regarding the scientific development of Islamic finance.

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. 14 no. 2
Type: Research Article
ISSN: 1753-8394

Keywords

Article
Publication date: 5 February 2018

Neha Seth and Laxmidhar Panda

The purpose of this paper is to obtain a comprehensive structure of past empirical studies on financial contagion which can provide the present growth and future scope of research…

1141

Abstract

Purpose

The purpose of this paper is to obtain a comprehensive structure of past empirical studies on financial contagion which can provide the present growth and future scope of research work on the field of contagion analysis.

Design/methodology/approach

Present study identifies 151 empirical studies on financial contagion and summarises all the studies on the basis of tools and methodology used, year of the studies, origin of the studies, sample period and sample countries taken, studies undertaken on the basis of different crisis period and markets considered and finally sources of the studies.

Findings

The results of the analysis show that the empirical studies on contagion increased continuously over the past five years. Higher order test of contagion with more number of sample countries may provide more accurate picture on financial contagion.

Originality/value

This paper collects, classifies and summarises past empirical studies on financial contagion and provides valuable conclusion on present growth and future scope of studies on financial contagion. The information given in this paper can be helpful for future researchers and academicians on this particular field; the summary of the conclusion (from past reviews) may be helpful for the policy makers for asset allocation and risk management.

Details

Qualitative Research in Financial Markets, vol. 10 no. 1
Type: Research Article
ISSN: 1755-4179

Keywords

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