StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...

Malaysian stock market - Essay Example

Comments (0) Cite this document
Summary
The purpose of this study is to find out how the Malaysian stock market (Bursa Malaysia) reacts to companies' response to Kuala Lumpur Stock Exchange (KLSE) query on unusual market activity. Specifically, of interest to the study is the behaviour of the average and cumulative returns and if there are large positive abnormal volume results to an individual stock prior to and after the date of firms' explanation to the KLSE query…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER91.6% of users find it useful
Malaysian stock market
Read TextPreview

Extract of sample "Malaysian stock market"

Download file to see previous pages Using Duncan & Etebari's (1990) method, an initial sample of five securities firms in the KLSE which posted the largest price gains for each of the 49 trading weeks of 2005 will be obtained, all of which were queried by the KLSE during the same period as well. From the price data, initial raw returns will be calculated which in turn will be used to estimate average and cumulative average returns. Conversely, a measure of 'unusual' trading volume will be obtained from the samples by still using Duncan & Etebari's method in measuring abnormal trading volume. A t-test will be applied to determine if behaviour of the average and cumulative returns and positive abnormal volume results are significantly different from zero.
Information disclosure is one of the most crucial ingredients for the effective operation of stock markets. Yang and Wu (2002) cite that the financial crisis in Southeast Asian countries that broke out in 1997 and the Enron bankruptcy case in the United States capital market in 2001 provide negative examples that teach about the importance of information on the stock market. Inadequate and even fraudulent information disclosure would bring tremendous negative effect on the effective operation of the whole capital market (Yang and Wu, 2002).
As a listed company making full disclosure reduces information asymmetry and enables the public to have information necessary to make informed decisions (Hwa, 2004), Bursa Malaysia demands and requires issuing listed company for explanation when it observes unusual share price or trading volume changes for that company. As stated in the Bursa Malaysia Listing Requirements, paragraph 9.02(2), "a listed company is required to make immediate public disclosure of any material information." When information is voluntarily withheld, the company must closely monitor the share price of the company during the period. A company must make immediate announcement to Bursa Malaysia upon detecting unusual circumstances such as heavy share transaction volume, unusual market activity, surfacing rumours or news and signs that insider trading are happening. The company under these situations must immediately publicly clarify, confirm or deny the rumour or report (Hwa, 2004). Such a response may have information content and thus market impact.
The role of informational content of companies' responses to unusual market activity observed by the Kuala Lumpur Stock Exchange is the prime component of the study. The theory of efficient capital markets provides that stock prices will respond to announcements only when the information being announced is new and unexpected. Because changes in stock prices are unpredictable, when information is announced that has been expected by the market, the stock price will remain unchanged (Mishkin, 2003). Studies done by Teitenberg and Wheeler (2001) on information disclosure strategies write that public announcements do seen to affect the market valuations of firms.
Effective information disclosure also entails the reduction or the control of insider trading in the stock market. In ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Malaysian stock market Essay Example | Topics and Well Written Essays - 3000 words”, n.d.)
Malaysian stock market Essay Example | Topics and Well Written Essays - 3000 words. Retrieved from https://studentshare.org/miscellaneous/1500951-malaysian-stock-market
(Malaysian Stock Market Essay Example | Topics and Well Written Essays - 3000 Words)
Malaysian Stock Market Essay Example | Topics and Well Written Essays - 3000 Words. https://studentshare.org/miscellaneous/1500951-malaysian-stock-market.
“Malaysian Stock Market Essay Example | Topics and Well Written Essays - 3000 Words”, n.d. https://studentshare.org/miscellaneous/1500951-malaysian-stock-market.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF Malaysian stock market

Stock Market

I chose these stocks as a foundation for a diversified portfolio and would like to build positions in each company for long-term holdings targeting 5-10 years. With the exception of Yongye, these stocks are all industry leaders and corporate entities with large asset bases and established business/consumer products. I chose these stocks because I believe that they should not only outperform the market but also limit downside risk to preserve capital. Due to the requirements of the assignment, I chose my entry points for the stock purchases late in order to capitalize on building my position through purchasing at a lower initial price. Over the course of the investment cycle, from 5/27/2011 to 6/2/2011, the rate of return of each...
4 Pages(1000 words)Essay

Desribe bahrain stock market

...?Bahrain Stock Market Table of Contents Question 3 Question 2 4 Reference 6 Question Describe the securities traded in the Bahrain Stock Market and the Regulator supervision over the financial market. The Stock exchange of Bahrain is known as Bahrain Bourse which is the only nationalized stock exchange in Kingdom of Bahrain. This stock exchange was established in 1987 and used to be known as Bahrain Stock Exchange. However, it started its first trading with 29 listed companies in June 1989. During 1999, automated trading system (ATS) was introduced and investors started the transaction electronically. In order to bring better regulation in the capital market, the regulation authority was transferred to Central Bank of Bahrain (CBB...
2 Pages(500 words)Essay

Stock Market Efficiencies

...Stock Market Efficiencies There are three forms of stock market efficiencies which include: - weak, semi-strong and strong forms of efficiencies. Weak form efficiency is one of the three degrees of efficient market hypothesis (EMH) that claims all the past prices of stock as they are reflected in today’s stock prices. In this case technical analysis cannot be used to predict and beat a market. Proponents of this form of market efficiency claim that fundamental analysis can be used to identify stocks that are undervalued and overvalued enabling research by investors looking for profitable companies to invest in. semi-strong form of efficiency is a class of EMH which claims that all public information is calculated into a stock’s current...
5 Pages(1250 words)Assignment

Stock Market

... Stock market summary essay Introduction This essay seeks to relay to the reader a comprehensive summary of a stock market case. The case involves an investor who has $1 million and seeks to invest in various stocks of his choice. The essay covers how the investor should invest the above amount, what reasons the investor has for choosing the stocks and the manner of investment. Also included in this essay is the detailed but precise analysis of the stock selected by the investor. The essay present analysis of the company whose stock has been purchased by looking at the historic performance of the company based on stock prices and the risk rates to which any prospective investor must pay attention. The essay concludes by indicating...
2 Pages(500 words)Essay

Stock market

... Stock Markets The stock market is one of the largest financial markets in the world. Companies and s in different countries sell their stock to get money to run their companies towards specific goals and objectives. The public buy the stocks and the money goes to the institution that has floated the stocks and benefit through the fluctuations of the stock. The stock market can be very profitable but can also lead to losses. The stock market is very profitable creating a lot of interest to many people and though it may result in losses, there is a lot of benefit to the institutions selling their stocks, the individual that buy it and the governments of the various countries, making it one of the most popular earners. The Stock Market...
3 Pages(750 words)Essay

Stock Market Advice

...STOCK MARKET Since 1802, stocks have returned an annual average of about 7% after inflation while US treasury bonds have returned about 3%.'' ---James Glassman (author of Dow 36000) in Stocks are still the best bet,' The Guardian, May 26, 2003 For the equity markets overall, returns of about 5 percent to 7 percent annually above inflation. This range has been the same for long-term investor for over 100 years and, I suspect, will be the same for many years to come.'' ---Scott Evans (Executive Vice President, CREF Investments) in Stock Investing: Take the Long-Term View,' TIAA-CREF Participant, May 2003. Investing in the stock market calls for and requires a certain degree of experience and expertise. It is no place for amateurs...
2 Pages(500 words)Essay

Stock market

... Stock Market Introduction The term 'the stock market' is a notion for the system thatenables the trading of company stocks (collective shares), other securities, as well as derivatives. Bonds are still traditionally traded in a casual, over-the-counter market identified as the bond market. Commodities are traded in commodities markets, with derivatives are traded in a diversity of markets. The size of the worldwide 'bond market' is estimated at $45 trillion. The size of the 'stock market' is estimated at about $51 trillion. The world derivatives market has been estimated at about $480 trillion 'face' or nominal value, 30 times the size of the U.S. economyand 12 times the size of the entire world economy. The major U.S. Banks alone...
10 Pages(2500 words)Essay

Stock Market

... Price-sensitive information, according to the definition of moneyextra.com website, is any information about agiven business’ trading operations or otherwise, which if known is expected to impact on the stock price of the same company. An example is knowledge that a company is in the verge of being declared bankrupt. If a person uses such information to buy or sell a company’s shares in the stock market this could amount to insider trading and which is a highly prosecutable criminal offence in the UK. (moneyextra.com, 2007) Further, price-sensitive is a class of information that is seen to affect two things:- It’s a business’ obligation to make it disclosed, and Whether utilisation of such information or otherwise results...
5 Pages(1250 words)Essay

Canadian stock market

... Task Canadian Stock Market List of investments Company Oct. 24 Oct. 28 Nov. 4 Nov. 10 Nov.18 Nov. 25 Goldcorp Inc. $46 $ 45 $46 $44 $43 $42 Bank of Montreal. $59.46 $59.12 $58.44 $57.12 $56.26 $55.64 Tim Hortons Inc. $50.25 $49.5 $49.1 $48 $47 $46.5 Apple Inc. $400 $400 $401 $398 $397 $396 Calculations of the overall increase or decrease in the market price of each investment Goldcorp Inc. Decreased by $46-42/46 =8.6% Bank of Montreal Decreased by 59.46-55.64/59.46 =6.4% Tim Hortons Inc Decreased by 50.25-46.5/50.25 =7.46% Apple Inc Decreased by 400-396/400 =1% Why I chose Mutual funds A mutual fund is a form of investment that pools money from different investors and invests depending on the intended objectives. I chose the mutual...
5 Pages(1250 words)Assignment

Stock Market Recap

... unit 10 June Stock market recap The stock market is one of the opportunities for investments and capital source. Price changes determine returns after a period, and below is a recap of three stocks and decisions over the stocks. Facebook Inc Dynamism of Facebook Inc that has made it popular and promises sustained popularity informed its choice. Its continued expansion that ensures consumers’ utility and guarantees its sources of revenue identifies the company’s short-term and long-term sustainability and safety of investments in its stock. It has expanded its applications through product acquisitions and this is likely to continue in the future. In addition, its popularity as a social media informed the choice. I would buy more shares...
2 Pages(500 words)Assignment

Clothing Retail Market in General

The industry is оverwhelmed with cоmpetitiоn frоm cоmpаnies which hаve invested in hi-tech mаchinery leаding tо greаter efficiency оr hаve plаced their prоductiоn tо fаctоries in cheаp lаbоur cоst cоuntries tо prоduce their prоducts. Hоwever, mоst pаrt оf the cоmpаnies in this sectоr mаke nоt very high prоfits. Tо increаse the mаrket shаre in this аrenа is nоt аn eаsy tаsk, аnd therefоre it needs а greаt deаl оf endeаvоur, knоwledge, аs well аs energy аnd mоney.
Clоthes retаilers fаll intо twо brоаd cаtegоries: firstly, thоse selling оwn-brаnd clоthing аnd, secоndly, thоse selling third-pаrty weаr. Mаjоr retаilers such аs Mаrks & Spencer аnd the Аrcаdiа Grоup аre gооd exаmples оf the first grоup, аs аre chаin оperаtiоns s...
18 Pages(4500 words)Research Proposal

Market Analysis and Segmentation: JetBlue Airways

It is for this reason that JetBlue management painstakingly handles the services and amenities that the company offers. They present very competitive technology as far as providing comfort to their passengers is concerned. Destination-wise, JetBlue Airways may be considered a specialty carrier that is relegated to a short-haul concentration, taking advantage of similar economies available with advanced technology and updated equipment. A short-haul carrier, JetBlue operates efficiently by consolidating services and economies of scale. Consequently, as a short-haul carrier, JetBlue’s revenues are considerably high compared to other airline companies.

In 2003, JetBlue declared a profit of $ 17.6 M for its first quar...
6 Pages(1500 words)Case Study

Starbucks in Chinese Market

In the year 1996, the coffee giant marked its global presence. Up until 2004, the Chinese government prohibited Starbucks to operate its own stores in China. As a result, the coffee giant enters the Chinese market by joint-venturing with Chinese food and beverage companies and licensing other companies to own and operate its stores--differs from its domestic approach. But the company was able to easily overcome its initial obstacles and marked its presence in China very quickly and successfully with great brand recognition and customer satisfaction. The company also tailors its stores to match the local atmosphere. This is a transnational strategy. “For example, the Starbucks strategy in Shanghai is to attract middle to high...
7 Pages(1750 words)Case Study

The Challenges of Foreign Market

Any multinational company is exposed to risks such as change of foreign currency exchange rate, commodity prices, and interest rates because it denominates its transactions in foreign currencies. That’s why there is also some uncertainty in future earnings, liabilities and assets values.
Therefore, before taking a decision on the country of entry, a profound analysis of its current political and economical situation is to be performed. According to Kotler and Armstrong (351-361), a decision on whether to enter a foreign market should be based on a profound analysis of potential risks and opportunities, as well as the company’s internal resources.
The company is a Limited Liability that exports roasted and gro...
11 Pages(2750 words)Case Study

Oil Prices by OPEC and Market Fundamentals

Market failure is defined as the inefficient allocation of resources by the market, the free market is considered to optimally prices and resources in the production of goods and services, and this is because the price and quantity produced are determined by market forces which include the demand and the supply. The control of prices by a firm or an organization in the market results in market failure, therefore OPEC leads to market failure due to its nature in the market.

OPEC was formed in 1960 by 5 oil-producing countries which include Venezuela, Saudi Arabia, Kuwait, Iran and Iraq, The aim of this organization was to unify petroleum-producing countries in order to realize fair and stable prices of oil .other oil-pro...
6 Pages(1500 words)Report

Segmentation, Target Market, and Positioning of the Fortified Wine

There are some types of fortified wines which carry a rich legacy and ethos of the Australian culture and society. This rich history and distinct flavour can be utilised to penetrate growing markets like China and build a strong brand presence there when the market is relatively immature. Moreover, tweaking of marketing, distribution and pricing strategies would offer greater sales potential for the fortified wine industry itself in Australia.

Among the variety of wines that are available, the Australian wine industry offers an attractive bevvy of the following variants of red wine, white wine, vintage wine, sparkling wine, dessert wine and fortified wines.

The fortified wines are also termed as “liquid...
10 Pages(2500 words)Business Plan

The Effects of Financial Crisis on Supplier Selection Criteria of the Oil and Gas Industry Equipment Market

It is a difficult task to find those vendors who not only have the adequate quality and quantity of the needed raw materials but who also have an attitude of efficiency and display commitment to customer service (Sonmat, 2006). Further, organizations also strive to locate and select vendors who can be depended upon for long term relationship.

The number of factors or attributes desired from the vendor is vast, and different organizations and different industries place different importance on the attributes (Sonmat, 2006). Some of the vendor attributes may gain importance owing to the nature of the industry, for example, in the case of consumer perishables suppliers, like fresh vegetables or fruits, the buying firm would...
20 Pages(5000 words)Literature review

Foreign Market Entry and Diversification

...Foreign Market Entry and Diversification Table of Contents Identification and discussion of the trendsin the global beer markets 3 International expansion trends and Modelo’s internal expansion 5 The next foreign market Modelo should enter 6 Challenges from InBev 7 Modelo should diversify 8 References 10 Identification and discussion of the trends in the global beer markets Beer industry is one of the largest industries in the world. Over the last few years the entire alcohol industry enjoyed a satisfactory performance. In 14th century modern beer industry started in Europe. Since the tastes of consumers vary from region to region, the industry was clustered in nature and it was dominated by several local breweries. Earlier transportation...
7 Pages(1750 words)Assignment

Macro and Microeconomics Factors in the UK Housing Market

The housing industry is divided into residential, commercial and industrial segments. Economists define supply in terms of service units, that is, a physical unit can be deconstructed into the services that it helps provide. These housing unit services are considered as an unobservable theoretical construct. Housing stock depreciates making it qualitatively different from a brand new constructed building.
The owner, user/owner and renter comprise the demand side of the housing market while the renovators and developers comprise the supply side of the market. In order to implement the simple demand and supply analysis to the housing markets, several modifications have to be made to the standard microeconomic procedures and ass...
8 Pages(2000 words)Research Paper

Entry into Foreign Market

However, political instability and turmoil are yet a few of the hindrances which could affect the stock markets and in a worst-case scenario may as well, completely shut down businesses (Root 1982). The new business practices, on the other hand, involve a transparent setup and a free market, free of turmoil to operate and maximize production (Bennett 1998). Also, in such a case, the consumer must also be able to spend on the product, to make it a success. However, Burma currently has strong institutions having a hold on the resources which need to be exploited, i.e. a few of the military generals and autocrats have access to the resources, and thus, dealing with these groups might prove to be a waste of the corporation`s own effor...
6 Pages(1500 words)Assignment
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Essay on topic Malaysian stock market for FREE!

Contact Us