This paper examines the impact of commodity prices (palm oil price, oil price, and gold price), interest rate, and exchange rate on the Malaysian stock market performance. Employing the bounds test approach, the results of the study showed cointegrating relationships among variables. Specifically, the results revealed a significant influence of palm oil price on the stock market index. However, no significant influence was observed for both the oil price and gold price. Interest rate and exchange rate showed significant influences, which are consistent with past empirical studies. One important policy implication from this study is that the authorities should also pay attention to the effect of commodity prices, in addition to macroeconomic variables, in implementing relevant polices, as they may have a negative impact on the Malaysian stock market.
This study investigates the effect of efficient working capital management and working capital policies on the performance of manufacturing firms in Malaysia between 2010 and 2016. To achieve the objective, this study uses balanced panel data of 143 manufacturing firms that are listed on the Main Market of Bursa Malaysia. The results show that cash conversion cycle, which is used as a proxy of efficiency working capital management, is significantly negative in having an effect on the economic value added, which is used as a proxy of firm performance. Moreover, the results show that the ratio of current assets to total asset, which is used as a proxy of working capital investment policy, has a significant and positive effect on the firm performance. However, the results show that the ratio of current liabilities to total asset, which is used as a proxy of working capital financing policy, has no effect on the firm performance. The results of the study imply that the manufacturing firms in Malaysia can increase their economic value added by adopting efficient working capital management which is to reduce their cash conversion cycle. In addition, the manufacturing firms in Malaysia can improve their economic value added by adopting a conservative working capital investment policy.
This study empirically investigates the impact of stock market on Malaysian economic growth using a vector autoregressive (VAR) estimation technique and impulse response function (IRF) over the period of 1988 through 2012. The study is motivated by empirical findings that a well-functioning stock market plays an important role in enhancing economic growth in the developed countries. We find that Malaysian stock market exhibits a positive impact on economic growth. However, we find that the positive impact lasts only for a short period. Specifically, the effect only appears in the first year after the change in market size occurs. In the second year, the effect then starts to alleviate and completely diminishes after several years. The findings provide clear implications that the positive impact of stock market size changes should be fully utilized immediately once it is realized because the impact will not last long.
This paper examines crowdfunding, an internet-based source of financing and investment tool, which is gaining popularity due to its simpler and faster procss compared to the traditional financing and investment tools. Although it has a handful of benefits and potentials, the threats associated with it should not be ignored. Information asymmetry is one of the problems identified. High information asymmetry may exist when the fund seekers intentionally do not fully disclose some information in order to protect their own interest. Consequently, the limited information disclosure could result in adverse wealth effect to the contributors or investors. This paper contributes to the extant literature by providing thematic discussions about the crowdfunding's practices, threats and opportunities based on the information gathered from a desktop research. The findings would be able to provide insights to the fund seekers looking for funding and to the potential investors looking for an alternative investment product.
The liberalisation of the Islamic banking industry in Malaysia has given rise to the emergence of many foreign Islamic banks in the country, raising a major concern regarding its impact. This study investigates the impact of bank-specific and macroeconomic factors on bank profitability from 2005 to 2017. Unbalanced panel data of eleven domestic and six foreign Islamic banks have been employed to achieve the study's objective. The findings show that different factors influence the profitability of domestic Islamic banks and foreign Islamic banks. While internal factors significantly affect the profitability of domestic Islamic banks, the profitability of the foreign Islamic banks is more stable and less affected by internal and external factors. The findings provide insights to domestic Islamic banks to improve their operations, profitability, and competitiveness. These banks' better operational efficiency and performance will consequently improve the overall Islamic banking industry.
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