Environmental Performance and Financial Performance of Green Mutual Fund—Evidence from China

Yin, Yanru

doi:10.4236/ojbm.2017.54057

Cited by 10 publications

(6 citation statements)

References 29 publications

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“…There are a number of comparative studies that investigate the performance of green funds. Climent and Soriano (2011) compare the performance of investments in green mutual funds versus the other conventional counterparts in the USA, and Chang et al (2012) and Yuan (2017) do the same for China. While the first two studies found the green funds to underperform, Yuan (2017) found the green funds to outperform the non-green.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Climent and Soriano (2011) compare the performance of investments in green mutual funds versus the other conventional counterparts in the USA, and Chang et al (2012) and Yuan (2017) do the same for China. While the first two studies found the green funds to underperform, Yuan (2017) found the green funds to outperform the non-green. McLachlan and Gardner (2004) compared investment behaviors of socially responsible or ethical investors with that of conventional investors; Connaker and Madsbjerg (2019) comment on the state of green investing with a global outlook; Adamo et al (2014) offered a comparative overview of the performance and risk of green funds.…”

Section: Literature Reviewmentioning

confidence: 99%

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Time series momentum trading in green stocks

Chakrabarti

Sen

2020

SEF

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Purpose The purpose of this study is to explore the inherent instability, if any, in the context of investment in stocks of environment friendly companies (or the “green” stocks) across the globe using the time series momentum (TSM) trading strategies. Design/methodology/approach Using the monthly data for the Green Indexes from the USA, the Europe and the Asia-Pacific region over 2003-2019, the authors construct TSM trading strategies to examine the efficacy of regional Green Indexes as well as two diversified global green portfolios to offer abnormal return to attract investors, particularly speculators. The authors’ explore further whether such strategies could operate as hedging instrument. A comparison of results across different regions helps the authors establish a universal nature, if any, of investment in green stocks. Findings The study finds that regional Green Indexes are unable to outperform the market. The global green portfolios perform significantly better. The inefficacy of the relevant time series momentum trading strategies rules out the possibility of speculations. However, the number of profitable momentum strategies is significantly higher for the diversified portfolios in longer run. The portfolios perform significantly better in outperforming the buy-only strategies as well. The stable market, escalated demand and the resulting increment in valuation of green stocks make adoption of greener technologies a choice rather than a forced obligation. This offers a solution to the problem of Tragedy of Common. Originality/value Sustained increase in investment in green stocks is crucial from an environment perspective, as better valuation of their stocks would indubitably convince firms to reduce their carbon footprints. A continued enthusiasm however would require investors’ faith in it. Presence of momentum profit would invite speculators leading to irrational exuberance, dwindling confidence and consequent fragility. Literature on green investment is relatively sparse with the threat of its vulnerability issues left largely unnoticed. The authors’ study fills these gaps.

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Section: Literature Reviewmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Time series momentum trading in green stocks

Chakrabarti

Sen

2020

SEF

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“…More importantly, Chen & Ma (2021) argue that green finance has a substantial impact on environmental abuse, improving environmental performance. Further, Yuan (2017) report a relationship between green finance and environmental sustainability. However, green finance has the highest positive impact on environmental sustainability.…”

Section: Introductionmentioning

confidence: 99%

The Introduction of Green Finance: A Curse or a Benefit to Environmental Sustainability?

Zakari

Khan

2022

Energy RESEARCH LETTERS

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In this study, we examine the role of green finance in achieving a sustainable environment for 11 of the top countries in terms of investment in environmental protection from 2006 to 2017. By applying panel-corrected standard errors and the feasible generalized least squares model, we find that green finance is associated with an improvement in environmental sustainability. However, energy consumption and urbanization have an adverse effect on environmental sustainability.

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“…According to Shibli and Markandya, the pollutant charge was relatively ineffective in China, because it was casually dependent on the local government [42]. The effects of the environmental standard charge on air pollution reduction in Shandong Province in China were not significant in the studies by Yuan et al [43] and Hui et al [33].…”

Section: Introductionmentioning

confidence: 99%

The Role of Environmental Tax in Alleviating the Impact of Environmental Pollution on Residents’ Happiness in China

Liu

Song

et al. 2019

IJERPH

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Background: Environmental tax has been implemented by the government in response to the demands of the residents to control environmental pollution. However, a tax has a wide effect on many interacting aspects of the society. It remains unknown whether enacting an environmental tax for the government can improve the residents’ happiness. This study aimed to examine the impact of air and water pollution on residents’ happiness and evaluate whether an environmental tax can alleviate the impact of air and water pollution on residents’ happiness. Methods: Based on the 2015 Chinese General Social Survey Data, 28 provinces in China were divided into two categories according to their environmental tax rates: baseline-tax areas (n = 13) and high-tax areas (n = 15). The ordered probit model was used to analyze the impact of air and water pollution on the residents’ happiness in baseline-tax areas and high-tax areas, respectively. The Chow Test was used to test whether the impact of environmental pollution on happiness was different between baseline-tax areas and high-tax areas. Results: The impact of air pollution on residents’ happiness was statistically significant in the baseline-tax areas (coefficient −0.162, 95% confidence interval (CI) −0.239, −0.086, p < 0.001), but the significance was weakened in the high-tax areas (coefficient −0.030, 95% CI −0.060, 0.000, p = 0.051). The Chow Test showed that the absolute value of the regression coefficient in the baseline-tax areas was significantly higher than the value in the high-tax areas (F = 12.712, p < 0.001). Similarly, the impact of water pollution on residents’ happiness was statistically significant (coefficient −0.264, 95% CI −0.353, −0.174, p < 0.001) in the baseline-tax areas and in the high-tax areas (coefficient −0.063, 95% CI −0.091, −0.035, p < 0.001), but the Chow Test showed that the absolute value of the regression coefficient in the baseline-tax areas was significantly higher than the value in the high-tax areas (F = 13.758, p < 0.001). Conclusions: Both air and water pollution impair residents’ happiness. The present study shows for the first time that enacting an environmental tax significantly alleviates the negative effect of air and water pollution on residents’ happiness. The findings of the present study provide empirical evidence for the government to levy environmental tax.

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Environmental Performance and Financial Performance of Green Mutual Fund—Evidence from China

Cited by 10 publications

References 29 publications

Time series momentum trading in green stocks

Time series momentum trading in green stocks

The Introduction of Green Finance: A Curse or a Benefit to Environmental Sustainability?

The Role of Environmental Tax in Alleviating the Impact of Environmental Pollution on Residents’ Happiness in China

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