Search

Purpose: This study examines how the importance of external investment environment factors affects stock market perception, and how stock market perception affects stock investments after stock market crash witnessed by individual investors in one of the emerging stock markets. Design/methodology/approach: A cross-sectional survey was administrated among 223 individual investors who experienced stock market crash in 2010–2011 in Bangladesh, and the proposed model was tested by the partial least squares-structural equation modeling PLS-SEM model. Findings: Findings show that the importance of Bangladesh's stock market performance, government policy, economic issues and neighboring country's stock market performance have effects on investors' stock market perception. This perception, in turn, decreases monthly stock trading and short-term investment horizon. The findings further show the mediating effect of stock market perception. Practical implications: Investors need to carefully consider the external investment environment when they form their stock market perception, as this perception drives stock investments. Analogously, regulators should ensure releasing timely and updated statistics on external investment factors. Originality/value: Addressing those investors who encountered stock market crash, a set of external investment environment issues, stock market perception and stock investments are new in the literature. [ABSTRACT FROM AUTHOR]

Some of the problems of cash transactions were the inconvenience of handling cash and the limited availability of banking services to facilitate cash withdrawals. The purpose of this paper is to examine the impact of cashless payments on the usage of the internet and mobile banking services in twofolds. First, the Wald test was applied to determine the short-run causal effect of the diffusion from cash to cashless payment on the internet and mobile banking. Second, the autoregressive distributed lag (ARDL) bounds test was employed to determine the long-run effect of cashless payments on the internet and mobile banking. The novelty of this study is threefold. First, this study employed the total value of cashless payments transacted per month data that were previously unavailable for time series analysis. Second, unlike studies on the intention to adopt cashless payments, internet and mobile banking, this study used data of actual transactions paid by a consumer. Third, this study established that the internet and mobile banking were delivery channels for cashless payments. [ABSTRACT FROM AUTHOR]

Examining the impact of green human resource management (GHRM), top management commitment (TMC), and green culture (GC) on green performance (GP) of Palm oil companies (POCs) in Malaysia is the aim of the study. A self-administered structured questionnaire was adapted to collect data. SPSS and Smart-PLS software analyzed the 165 firms' usable responses. The empirical results found significant positive impacts of GHRM, TMC, and GC on GP. The outcome offers valuable insights into the knowledge domain and practices of GHRM and how it affects the GP of POCs. Moreover, the observed results highlight the importance of GC and TMC in implementing green procedures to create positive GP. To the researchers, no study has explored the relationship between GHRM, TMC, GC, and GP using empirical data from Malaysian POCs. Moreover, this research's findings enrich the researchers, academicians, and practitioners practically and theoretically. [ABSTRACT FROM AUTHOR]

Purpose: Objectively, this study aims to recognise the antecedents that influence the managers' environmental practices behavioural intention and its impact on their companies' performance, namely, environmental and perceived future financial performance. Design/methodology/approach: Standardised structured questionnaires are distributed through the investor relations department where the targeted respondents must be ranked manager position and above. A total of 107 usable responses were collected. To analyse the data collected, partial least square structural equation modelling is use. Findings: Empirically, subjective and corporate norms are positively influencing the managers' environmental practices intention. Corporate norm has the greatest effects among the antecedents. Furthermore, managers' environmental practices intention is also found influential to their behaviour. Subsequently, the managers' environmental practices behaviour is also positively influencing both environmental and perceived future financial performance. In which, managers' environmental practices behaviour has a larger effect on their companies' environmental performance. Finally, environmental performance is also positively influencing the perceived future financial performance. Research limitations/implications: This study enhance the theoretical framework by integrating the extended theory of planned behaviour and norm activation model and extend the original theory of planned behaviour. Also, the greatest effect on corporate norm suggests companies to embrace corporate responsibilities internally to protect the environment. Practically, this study also provides few suggestions to the management so that they can cultivate environmentally friendly behaviour among the employees. Originality/value: This study is integrating the extended theory of planned behaviour and norm activation model to examine the antecedents to the environmental practices intention among managers of the Malaysia listed companies and extends the original theory of planned behaviour to examine the impact of environmental practices behaviour to companies' performance. [ABSTRACT FROM AUTHOR]

Purpose: This study aims to investigate the influence of various risk factors, specifically investment risk, legal risk and technology risk, on the decision of investors to invest in equity crowdfunding ventures in Malaysia. Design/methodology/approach: A total of 169 valid responses out of a total of 195 questionnaires were distributed to individuals with prior knowledge of equity crowdfunding. The data from the responses are used to test the relationships using structural equation modeling partial least squares (SEM-PLS). Findings: Investigation into the influence of risk factors on the willingness to support equity crowdfunding shows that investment risk and legal risk significantly influence the decision to support equity crowdfunding ventures, but technology risk does not. However, while the influence of investment risk is negative, legal risk is found to have a positive influence. Originality/value: This study is important as, to the authors' knowledge, this is the first study to empirically test the relationship between the various risks inherent in equity crowdfunding investments and the decision to invest. The study is also important to entrepreneurs and start-ups as it provides evidence that while the equity crowdfunding investment community follows the norms of investment, i.e. lower risk is preferred, stricter laws and regulations governing equity crowdfunding may not be needed or may only be relevant in countries where there are more retail, unsophisticated investors. [ABSTRACT FROM AUTHOR]

Investors' perception of past portfolio returns predicts their investment behavior, but does this relationship mediate by overconfidence? Taking into account different aspects of overconfidence, this paper examines whether overconfidence manifested as illusion of control, miscalibration and better-than-average mediates the association between perception of past portfolio returns and investment behavior. In a survey study with individual and institutional investors from Malaysia, the results indicate that perception of higher past portfolio returns increases investors' trading, percentage of risky share investment and the number of financial asset holding, through the mediating channel of better-than-average effect. While individual investors are influenced by this overconfidence mechanism, institutional investors are not sensitive. This finding has theoretical implication for overconfidence model, house money effect and naïve reinforcement learning. Practically, the results imply that individual investors should be careful about underlying overconfidence biases as it can lead to inefficient decisions. [ABSTRACT FROM AUTHOR]

This study examines the abrupt jumps in the Dow Jones Islamic Market (DJIM) sectoral indices using a modified return-volatility model that allows for multiple structural breaks. The breakpoint tests for both return and volatility suggest that only several Islamic sectoral markets are insulated from the external shocks. The finding implies that the Islamic equities are merely a partial safe haven in the extreme market fluctuations. Among the sectoral indices, the oil and gas market exhibits the highest degree of volatility persistence, implying its past price can be useful to predict the future prices compared to other indices. It is also found the volatility persistence experiences a decline when abrupt jumps are incorporated into the model. These empirical results suggest the inclusion of abrupt jumps into the estimation is important to provide reliable explanatory power on the volatility dynamics of Islamic stock markets. This study may benefit the financial market participants and policymakers in making better-informed investing decision specifically for Sharia-compliant equities. [ABSTRACT FROM AUTHOR]

Purpose This paper aims to examine how board composition, political connections and sustainability practices affect risk-taking and performance of firms.Design/methodology/approach This paper used secondary data and regression technique to analyse the relationship. A sample consisting of 290 firm-year observations was applied in the analysis.Findings The findings show that a larger board size contributes to greater financial risk; however, this risk can be reduced with more independent directors in the boardroom. An optimal board size with appropriate number of independent directors is desired, as a large board size can be harmful to firm performance. Politically connected firms also generate lower risk-taking and performance, and the double-edged sword effect of political connections needs to be considered. In terms of sustainability practices, firms have to engage in sustainable development to maximise the firms’ value, not ignoring the vital role of women in strategising business performance. However, the effect of sustainability practices on firms’ risk-taking is still not noticeable.Research limitations/implications Even though the sample size is not large because of the limited availability of data, the findings, to a certain extent, could be generalised to emerging markets, as most emerging markets do have similar financial and economic developments.Practical implications The findings from this paper can be used to support the implementation of sustainability practices, especially in those countries where sustainability initiatives are yet to be widely accepted.Originality/value This is one of the first few studies that examined the effect of non-financial information on risk-taking and performance of firms. This study concludes the positive effect of sustainability practices on firm performance. [ABSTRACT FROM AUTHOR]

With the aim being to have an integrated and efficient management system, Malaysia is currently facing a remarkable waste issue with a massive increase in waste generated per day. This study collected 400 survey responses to assess the satisfaction and awareness of households about various issues of solid waste management. This study revealed that the majority of the respondents were satisfied with their waste management services. However, there was concern about providing a more diverse waste management facility. This study found a strong positive relationship between age and waste reduction behaviours. The majority of the respondents agreed that their lifestyle affected waste minimisation. Almost half of the respondents indicated that they lacked knowledge to practise waste sorting. Age and education were positively correlated to reuse and recycling behaviours. Overall, a holistic waste management education is vital for Malaysia to build an efficient waste management system. [ABSTRACT FROM AUTHOR]

Purpose The purpose of this paper is to investigate who trade actively in the Malaysian stock market and what determines investors’ active trading decisions.Design/methodology/approach Using a cross-sectional survey on individual investors, the study identifies active and inactive investors and then, investigates active trading by estimating binary logistic regression.Findings Active investors in Malaysia are more likely to be male, working in non-finance-related sectors and are more experienced. The likelihood of active trading increases with the number of hours spent on researching investment, very short-term favorable unemployment and economic growth expectations (three-month) and past investment outcomes, whereas this probability decreases with higher cognitive ability and short-term unemployment expectations.Practical implications The results imply that regulators may focus on certain groups of investors, based on the result of this study, and provide them training to reduce inactivity in this market. As active trading in response to past investment outcomes indicate rational response, regulators therefore may inform investors to learn about their ability and skill from their prior investment outcome, through educational program. Educational program may also include the role of macroeconomic indicators in active investing decisions.Originality/value This is the first study to combine a list of demographic and socio-economic characteristics, investment characteristics, macroeconomic expectations and past investment outcomes together to explain the likelihood of active trading. [ABSTRACT FROM AUTHOR]

Purpose Given the special feature of institutional investors in Malaysia, the purpose of this paper is to explore how these investors acquire and employ different information sources in their investing decisions.Design/methodology/approach The study uses self-reported information sources collected via a survey of 66 institutional investors following convenience sampling, and estimates the relationship via Smart-PLS (Partial Least Squares) path modeling.Findings The results suggest that although investors place greater importance on fundamental and technical indicators, they do not implement these information sources in their decisions. Rather, gathering information from economic statistics and ratios, discussion with colleagues, historical returns of the Malaysian stock market, decisions of other market players, specialized press and stock exchange bulletins, and statements of opinion leaders are more closely related to trading, risk taking, and financial asset holding. This finding supports the limited information processing of bounded rationality, irrespective of the type of information source.Practical implications Institutional investors should critically assess the information sources upon which they rely to collect information as irrational information processing may adversely affect the stock market efficiency.Originality/value To the authors’ knowledge, this is the first study to explore the unique features of institutional investors in Malaysia in conjunction with their sources of information, and to identify which sources matter when making investing decisions. [ABSTRACT FROM AUTHOR]

Purpose The purpose of this paper is to test the competing explanations of stated preferences for firm characteristics, optimism and overconfidence for trading activities in a single framework.Design/methodology/approach A survey methodology is followed to collect the data among retail investors in Malaysia using simple random sampling.Findings The findings show simultaneous identification of stated preferences for firm characteristics, optimism and overconfidence as determinants of trading activities. Preferences for firm’s profitability characteristics, management and product-related attributes and risky characteristics are likely to decrease investors’ trading activities. On the other hand, preferences for firm’s liquidity and trading volume characteristics with relative financial-domain optimism, personal investment optimism and better-than-average aspect of overconfidence are likely to increase investors’ trading activities.Practical implications This finding implies that investors should be careful not only in assessing firm’s characteristics but also need to understand the effects of optimism and overconfidence in trading decisions.Originality/value The study considers various aspects of optimism and overconfidence, and the stated preferences for firm characteristics, unlike one aspect of these behavioral biases and indirect observation of preferences for firm characteristics. Furthermore, the study considers trading frequency, annual portfolio turnover and trading intention, whereas earlier studies considered only one or two of these trading decisions. [ABSTRACT FROM AUTHOR]

Purpose – The purpose of this paper is to investigate the impacts of Financial Reporting Standards (FRS)139 adoption on value relevance of financial reporting for non-financial public listed companies in Malaysia. Design/methodology/approach – Multiple regressions were applied in this study to explore the value relevance of financial reporting upon FRS139 adoption. Findings – The finding indicates that book value of equity and net income after tax are significant in jointly explaining the variations associated with market value for both the pre- and post-FRS139 period. However, the role of the book value of equity and the balance sheet in stock market valuation is becoming increasingly important compared with the role of net income after tax and income statement upon mandatory adoption of FRS139. Originality/value – This study provides relevant insights into the potential consequences of FRS139 adoption in Malaysia. This is a significant event in the history of financial reporting in Malaysia. Given the importance and complexity of applying IAS39 in more developed countries, the results of this study add to current literature by providing a comprehensive empirical analysis on the effects of FRS139 adoption on financial reporting in Malaysia, a developing country where the economy is smaller, the financial market less efficient, and institutional settings different from developed countries. [ABSTRACT FROM AUTHOR]

Purpose – This paper aims to study gender differences in preferences for firm characteristics across various groups of investors in Malaysia. Design/methodology/approach – Self-declared preferences are elicited through a survey of 520 investors comprising retail, financial professionals and institutional investors in the Malaysian stock market. Non-parametric (Mann-Whitney and Kruskal-Wallis) tests are computed to achieve the stated objective. Findings – Results reveal that female investors display higher preferences for the liquidity of a firm, dividend payments, trading volume of a firm, stock price and firm’s age than male investors across investor’s groups. Research limitations/implications – Findings imply that the gender gap in investing behaviour can be partly attributed to gender differences in preferences for firm characteristics. Practical/implications – The findings suggest that the gender gap can be mitigated by giving more priority to the choices of female investors with respect to firm characteristics. In turn, this may reduce a part of the gender gap in investing. Moreover, the findings would assist companies to understand and know how their shareholder’s preferences vary with respect to gender and investor’s groups. Originality/value – This paper provides evidence concerning the gender gap in investor’s self-declared preferences for firm characteristics across retail, financial professionals and institutional investors in Malaysia, which complements previous studies that used equity holdings data and only two groups of investors. [ABSTRACT FROM AUTHOR]

Purpose – The purpose of this paper is to provide insights on how a firm's size is related to risk taking of Malaysia's insurance companies, from 2000-2010. Design/methodology/approach – The sample used for empirical testing in this study comprised direct insurance firms licensed under Malaysia's Insurance Act 1996, for the time frame between 2000 and 2010. Pearson's correlation, fixed and random effects models, and the system Generalized Method of Moments (GMM) method were used in this study. Findings – Both the fixed effects and the system GMM panel data regression models suggested a positive link between the insurance firm size and underwriting risk. For the robustness test, the results of the analysis using changes in data broadly resemble the outputs of the levels estimation. Research limitations/implications – The sample of this study is limited to Malaysia's insurance sector only. Originality/value – Advocates of the too-big-to-fail (TBTF) theory believe that government support and the guarantee of a financial bailout are warranted for large financial institutions facing crises, for the main purpose of avoiding disruptions within a country's economy. The drawback, however, may be that the TBTF doctrine is the culprit behind excessive risk taking by insurance firms of large proportions. A number of regulatory concerns have been raised and addressed from this study. [ABSTRACT FROM AUTHOR]

This paper examined the behavior of institutional and retail investors in Malaysia during the bulls and bears. The results revealed significant differences in behavioral patterns between these two groups of investors. For the institutional investors, obvious differences were found in the areas of overconfidence, liquidity preference, and price anchoring between these two distinct market trends. As for the retail investors, there were no obvious difference in investing behavior except in terms of liquidity preference and self-control. The overall results indicated that both investors exhibited overconfidence during both periods; nonetheless, they were somewhat rational by exercising self-control and being concerned with liquidity when making investment decisions. Both investors ranked dividend yield as the most important fundamental variable particularly during bearish market outlook. On the other hand, trend analysis was rated as the most important variable closely watched technical indicator during bullish market outlook. Consistent with the findings of both surveys, we provide evidence that dividend yield appeared to be significant risk factor as well. [ABSTRACT FROM AUTHOR]

Purpose – The purpose of this paper is to identify the relationships between risk management committee characteristics and risk taking of the Malaysia's insurance companies, from 2003-2011. The paper aims to examine three identified characteristics of a risk management committee, namely, size, independence, and number of meetings. Design/methodology/approach – The sample comprises 329 observations throughout the nine years' time frame until 2011. Pearson's correlation, pooled ordinary least squares regression, and panel regression model are used in this study. Sensitivity testing with an alternative measure of underwriting risk is also performed. Findings – Out of the three characteristics, size and committee independence appear to be negatively associated with underwriting risk. Meanwhile, the frequency of risk management committee meetings is insignificant in this study. Research limitations/implications – The sample of this study is limited to the Malaysia's insurance sector only. Originality/value – A risk management committee is an influencing force for risk oversight and the internal control system. The empirical evidence enriches the understanding of corporate governance in the context of the role of a risk management committee. [ABSTRACT FROM AUTHOR]

This paper explores the mean reversion behaviour of three Japanese real exchange rates during January 1980-January 2010. The CPI- and PPI-based real yen/USD rates and real effective yen rates are examined using newly improved unit root tests allowing for endogenous break(s) in the linear and non-linear manner. We identify structural breaks in 1985 and 1997/98, respectively, via the linear tests from Zivot and Andrews (1992) and Lumsdaine and Papell (1997), but the results were mostly against the PPP hypothesis. The test from Saikkonen and Lütkepohl (2002), however, provides sufficient support for the non-linear adjustment of real exchange rates towards long-run PPP (purchasing power parity), which suggests the goods market integration between the two nations. The exchange rate misalignment is somewhat less evident after the Plaza Accord 1985, and stronger evidence for PPP is found in the post-1999 period. This is supported by a smaller persistency of real exchange (half-life < a year) found in sub-sample analysis. In brief, our findings reveal that the Japanese authorities have implemented a PPP-oriented rule as a basis for their exchange rate policies in the presence of structural break(s) and non-linearity. [ABSTRACT FROM AUTHOR]