scholarly journals Does the choice of stock selection criteria affect the performance of Sharīʿah-compliant equity portfolios?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Muhammad Wajid Raza
Keyword(s):  
Risk Factors ◽  
Financial Performance ◽  
Transaction Cost ◽  
Selection Criteria ◽  
Stock Selection ◽  
Content Type ◽  
Screening Guidelines ◽  
Equity Portfolios ◽  
The Difference ◽  
The Cost

Purpose There are a number of differences in the current Sharīʿah screening guidelines formulated by Sharīʿah scholars associated with world-renowned index providers and financial institutions. The purpose of this study is to highlight the consequences of such differences on the portfolio level outcomes for Sharīʿah-compliant investors. This study also investigates the cost of adopting an alternative stock selection methodology. Design/methodology/approach Seven Sharīʿah-compliant equity portfolios (SCEPs) are created from the active constituents of the S&P 500. Size, sector allocation and financial performance of the resulting seven portfolios are evaluated for the period 1984–2019. Style analysis is performed to attribute the difference in financial performance caused by the choice of selection criteria to different risk factors. The cost of switching the selection criteria is evaluated with turnover analysis and break-even transaction cost. Findings The choice of stock selection criteria has a significant effect on the size, sector bets and financial performance of the portfolios. Those portfolios which are constructed with market capitalization-based screens outperform portfolios constructed with total assets-based screens. The turnover analysis revealed that SCEPs are relatively costly in practice. Originality/value This study investigates the performance of Sharīʿah-compliant portfolios in the context of seven different screening guidelines. The effects of transaction cost and performance attribution to different risk factors represent the key contributions of this study.

scholarly journals The cost efficiency of Vietnamese banks – the difference between DEA and SFA

2020 ◽  
Vol 22 (2) ◽  
pp. 209-227
Author(s):  
Phong Hoang Nguyen ◽  
Duyen Thi Bich Pham
Keyword(s):  
Cost Efficiency ◽  
Stochastic Frontier Analysis ◽  
Random Noise ◽  
Stochastic Frontier ◽  
Time Consistency ◽  
Efficiency Frontier ◽  
Content Type ◽  
Frontier Analysis ◽  
The Difference ◽  
The Cost

PurposeThe paper aims to enrich previous findings for an emerging banking industry such as Vietnam, reporting the difference between the parametric and nonparametric methods when measuring cost efficiency. The purpose of the study is to assess the consistency in issuing policies to improve the cost efficiency of Vietnamese commercial banks.Design/methodology/approachThe cost efficiency of banks is assessed through the data envelopment analysis (DEA) and the stochastic frontier analysis (SFA). Next, five tests are conducted in succession to analyze the differences in cost efficiency measured by these two methods, including the distribution, the rankings, the identification of the best and worst banks, the time consistency and the determinants of efficiency frontier. The data are collected from the annual financial statements of Vietnamese banks during 2005–2017.FindingsThe results show that the cost efficiency obtained under the SFA models is more consistent than under the DEA models. However, the DEA-based efficiency scores are more similar in ranking order and stability over time. The inconsistency in efficiency characteristics under two different methods reminds policy makers and bank administrators to compare and select the appropriate efficiency frontier measure for each stage and specific economic conditions.Originality/valueThis paper shows the need to control for heterogeneity over banking groups and time as well as for random noise and outliers when measuring the cost efficiency.

A costing study of the document supply service at a Chinese research library: the case of Wuhan University Library

2008 ◽  
Vol 36 (2) ◽  
pp. 86-90 ◽  
Author(s):  
Xia Liu ◽  
Ting Lei
Keyword(s):  
Design Methodology ◽  
Unit Cost ◽  
Research Library ◽  
Cost Study ◽  
Content Type ◽  
University Library ◽  
Costing Study ◽  
The Difference ◽  
The Cost ◽  
The University

PurposeThis paper aims to report on a cost study of document supply at Wuhan University Library, and to investigate the difference in costs over time and the cost‐effectiveness for the university.Design/methodology/approachA quantitative approach is employed.FindingsThe borrowing unit cost and lending unit cost decreased by 27 percent and 60 percent, respectively, between 2002 and 2004, but showed a small increase in 2006.Originality/valueThe paper reveals the cost of document supply in a Chinese research library and proves that the cost could be lowered rapidly by taking effective measures. The paper also demonstrates that document supply is an effective way to resolve the library budgetary crisis as well as satisfying end‐users' needs.

Estimating the hidden corporate social performance of Japanese firms

2016 ◽  
Vol 12 (2) ◽  
pp. 348-362 ◽  
Author(s):  
Megumi Suto ◽  
Hitoshi Takehara
Keyword(s):  
Financial Performance ◽  
Corporate Social Performance ◽  
Social Performance ◽  
Estimation Model ◽  
Content Type ◽  
Public Firms ◽  
Research Perspective ◽  
Stable Relationship ◽  
The Difference ◽  
Corporate Social

Purpose Managers sometimes hide their level of corporate social performance (CSP) from investors, intentionally or unintentionally. The purpose of this study is to estimate such “hidden CSP” of firms. Design/methodology/approach In this study, it is assumed that Japanese public firms can be classified into two groups based on the difference in corporate social responsibility (CSR) awareness. Thus, the respondents to the CSR questionnaire survey are classified as the CSR-aware group, and the non-respondents are treated as the CSR-unaware group. It is further assumed that a significant relationship exists between CSP and a firm’s attributes, including financial performance and stock ownership. Under these assumptions, a model to estimate the CSP of non-respondents is constructed using the relationship between CSP and a firm’s observable attributes. Findings There is a significant latent gap between the CSP of respondents and the hidden CSP of non-respondents because of differences in firm size, foreign dependency of business and reputation and trust in the financial markets, rather than because of differences in financial performance. Insider-oriented ownership structures are negatively associated with CSP. Research limitations/implications The estimation model developed in this study depends on a set of assumptions. In particular, a stable relationship between CSP and firm-specific variables, i.e. there is no structural change during the observation period, is assumed. Despite these limitations, this study extends the CSR research perspective, as it makes it possible to estimate the hidden CSP of public firms. Practical implications In practice, the findings of this study surface a part of the missing CSR that investors need and that could alert non-respondent firms to the importance of CSR strategy and related disclosures to adapt to rapidly changing social and environmental business settings. Originality/value This study is the result of academic interest in examining the missing information related to CSR activities to obtain an overall picture of the CSP distribution of Japanese listed firms as a whole.

Impact of liquidity and solvency risk factors on variations in efficiency of US banks

2020 ◽  
Vol 46 (7) ◽  
pp. 883-895
Author(s):  
Kekoura Sakouvogui
Keyword(s):  
Risk Factors ◽  
Financial Crisis ◽  
Cost Efficiency ◽  
Negative Impact ◽  
Random Effect ◽  
Basel Ii ◽  
Content Type ◽  
Efficiency Measures ◽  
The Cost ◽  
The Impact

PurposeThis paper evaluates the importance of both liquidity and solvency risk factors on variations in efficiency measures of US commercial and domestic banks from 2005 to 2017.Design/methodology/approachThe analysis is conducted using the true random effect stochastic cost model to examine the role of both liquidity and solvency risk factors. To this end, the author uses the exponential stochastic cost function and adds new variables, including bank size, crisis as an indicator of the financial crisis and the Dodd–Frank Act and Basel II Accord as regulatory dummies.FindingsThe results show that both liquidity and solvency risk factors positively affect the variance of cost inefficiency measures and thus have negative impact on the cost efficiency measures. In addition, banks increased the cost of financial intermediation during the financial crisis, whereas regulatory factors of Basel II Accord and Dodd–Frank Act play a crucial role in explaining the cost efficiency measures.Originality/valueThese results are the first to quantify the impact of both liquidity and solvency on the variations in cost efficiency measures.

Assessing the cost of competitive tendering in Ghana using transaction cost theory

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Collins Ameyaw ◽  
Blondel Akun Abaitey ◽  
Sarfo Mensah ◽  
Emmanuel Manu
Keyword(s):  
Public Sector ◽  
Transaction Cost ◽  
Rank Correlation ◽  
Inverse Correlation ◽  
Content Type ◽  
Competitive Tendering ◽  
Documentary Analysis ◽  
African Context ◽  
Sub Saharan ◽  
The Cost

PurposeThe purpose of this study was to determine the transaction cost (TC) contractors incur when tendering for a project as well as establish a correlation between the TC of tender and tender amount of projects procured through the national competitive bidding procurement method.Design/methodology/approachThe research draws extensively documentary analysis, observation and interviews to collect cost data on 14 different tenders submitted by a D1/K1 contractor. Using TC theory, the data are analyzed and the actual cost is determined. Further, Spearman rank correlation is employed to establish a relationship between tender price (TP) and the cost of tender by the aid of Statistical Package for Social Sciences.FindingsThe research developed a tender preparation conceptual framework highlighting the components of TC in competitive tendering in Ghana and also revealed that, apart from the emotional and psychological costs, contractors in Ghana incur approximately Gh₵ 4,625 (US$ 925)–Gh₵ 2,520 (US$ 504) to prepare and submit a competitive tender. In relation to the tender figure, the TC of tender in Ghana ranges from 0.05% to 0.65% and an average of 0.33%. Also, there is an inverse correlation between TP and the percentage cost of tender.Research limitations/implicationsThe research relied on 14 competitive tenders and also limited to public sector works. Findings from the study should therefore be applied with caution.Originality/valueThis study is the only known research that has focused on assessing the TC of public sector competitive tendering from a contractor's perspective and within a developing sub-Saharan African context.

scholarly journals Procedural rationality in supplier selection

2017 ◽  
Vol 55 (1) ◽  
pp. 32-56 ◽  
Author(s):  
Luitzen de Boer
Keyword(s):  
Supplier Selection ◽  
Selection Criteria ◽  
Early Stage ◽  
Selection Process ◽  
Empirical Studies ◽  
Qualitative Assessment ◽  
General Notion ◽  
Procedural Rationality ◽  
Content Type ◽  
The Cost

Purpose The purpose of this paper is to present three heuristics for choosing supplier selection criteria. By considering the balance between the expected relative effort and benefit of using different selection criteria, the heuristics suggest which criteria should be prioritized. The heuristics serve to develop our understanding of the search and evaluation heuristics used in supplier selection and to facilitate further research. Design/methodology/approach The research is primarily theoretical, yet draws on empirical studies of supplier selection. The theoretical basis is Simon’s notion of procedural rationality (Simon, 1976). The author makes the general notion of procedural rationality more concrete for supplier selection by formally describing three heuristics for choosing selection criteria. The heuristics share the same logic but differ in terms of the precision of the input information required from the purchaser. The paper provides illustrations of the heuristics. Findings It appears that procedural rationality can be specified for the process of designing the supplier selection process by explicitly recognizing the cost and value of selection criteria. There is no one way of doing this, but at the most basic level, it requires an ordinal ranking of criteria. Already such a rudimentary, qualitative, assessment can help identifying suitable criteria. The heuristics developed appear compatible with established approaches for the subsequent selection of suppliers. Originality/value The paper addresses the early stage of supplier selection which has been largely ignored in the literature.

What generic strategies do private fitness centres implement and what are their impacts on financial performance?

2020 ◽  
Vol 10 (3) ◽  
pp. 317-333
Author(s):  
Elsa Vieira ◽  
João Ferreira
Keyword(s):  
Financial Performance ◽  
Return On Assets ◽  
Content Type ◽  
Cost Leadership ◽  
Leadership Strategy ◽  
Industry Leadership ◽  
Combined Strategy ◽  
The Cost ◽  
Generic Strategies ◽  
Cost Leadership Strategy

PurposeThe purpose of this paper is to identify the strategies that private fitness centres implement and to evaluate their impact on financial performance.Design/methodology/approachBased upon a sample of 151 private fitness centres in Portugal, multivariate statistics report the implemented strategies and their effect on financial performance. We applied exploratory factorial analysis as our methodology to identify the types of strategy and the ANOVA in order to verify if there are differences of financial performance in the strategies.FindingsThe results obtained demonstrate how private fitness centres implement different strategies, including: cost leadership, differentiation, focus, quality of service, combined and stuck in the middle approaches. The relationship between strategies and financial performance, private fitness centres adopting a cost leadership strategy obtain the best financial performance levels in terms of the sales variable relative to any other strategy but with the combined strategy returning a better performance in terms of the return on assets when compared with the cost leadership strategy.Originality/valueThe originality of this paper stems from its identification of the strategies implemented by private fitness centres, thus, just what type of strategies are in effect across the fitness industry: leadership through cost, differentiation or a focused strategy. However, in addition to ascertaining just which strategies undergo implementation, it is also pertinent in determining just which strategy drives the best financial performance for private fitness centres given that private centres may only remain in the market when achieving financial sustainability. Therefore, this paper seeks to provide information for managers as regards the strategies implemented and their impacts on the financial performance of private fitness centres.

scholarly journals Healthy lifestyles to prevent dementia and reduce dementia symptoms

2017 ◽  
Vol 21 (1) ◽  
pp. 31-39 ◽  
Author(s):  
Eef Hogervorst
Keyword(s):  
Risk Factors ◽  
Disease Risk ◽  
Evidence Base ◽  
Ageing Population ◽  
Lifestyle Interventions ◽  
Protective Effects ◽  
Content Type ◽  
Limited Effectiveness ◽  
Heart Disease Risk Factors ◽  
The Difference

Purpose Dementia is a growing problem worldwide, due to an ageing population. It has significant human and economic costs. There is no effective medical treatment. The paper aims to discuss these issues. Design/methodology/approach Using earlier reviews, the author discussed the difference between dementia and cognitive ageing and the different types of dementia, in terms of manifestation and pathology. The author reviewed non-modifiable risk factors for dementia, such as age, gender, genetics and education. Education can possibly have lifelong protective effects, as it may promote cognitive reserve. This paper focussed on lifestyle interventions to further increase brain reserve capacity. Findings from earlier reviews were summarised to provide guidelines for policymakers and practioners. Findings The reviews suggested that most nutritional approaches may have limited effectiveness, and should be implemented in midlife, before dementia symptoms are present and probably only in people who are actually nutritionally deficient. The author found a reasonable positive evidence base of engagement in cognitive and physical activities to prevent dementia, which may also help reduce symptoms of dementia. Practical implications From the studies reviewed, it was suggested that keeping physically and mentally active may help in all stages of life to prevent, but also reduce dementia symptoms. A focus on nutrition and treating heart disease risk factors is possibly limited to midlife, or before dementia symptoms are present. Originality/value The author used an evidence based approach to review which lifestyle interventions could help prevent dementia or reduce dementia symptoms. The main outcome of this paper was that stage of life and ability (dementia present or not) may interact with success of the intervention.

Duration analyses of precision agriculture technology adoption: what's influencing farmers' time-to-adoption decisions?

2020 ◽  
Vol 80 (5) ◽  
pp. 647-664 ◽  
Author(s):  
Eric Ofori ◽  
Terry Griffin ◽  
Elizabeth Yeager
Keyword(s):  
Precision Agriculture ◽  
Crop Insurance ◽  
Farm Income ◽  
Embodied Knowledge ◽  
Content Type ◽  
Farm Level ◽  
Adoption Decisions ◽  
The Difference ◽  
The Cost ◽  
The Impact

PurposePrecision technologies have been available at the farm level for decades. Some technologies have been readily adopted, while the adoption of other technologies has been slower. The purpose of this study is to examine the factors influencing farmers' time-to-adoption decisions as duration between year of commercialization of precision agriculture (PA) technologies and year of adoption, at the farm level.Design/methodology/approachTime-to-adoption, which is the difference in years between technologies becoming commercially available and the year of adoption was determined using non-parametric duration analysis, and the impact of specific farm/farmer characteristics on time-to-adoption were estimated using a semi-parametric Cox proportional-hazard (CPH) model, based on a panel dataset of 316 Kansas farms from 2002 to 2018.FindingsThe findings indicate that, time-to-adoption for embodied-knowledge technologies such as automated guidance and section control were statistically shorter than for information-intensive technologies such as yield monitors, precision soil sampling and variable rate fertility. Duration was indirectly (directly) proportional to commercialization date of embodied-knowledge (information-intensive) technology. More so, time-to-adoption statistically differed among technologies within these two broad categories. Time-to-adoption varies across farm location and between both types of technologies. Millennial farmers are more likely to adopt both types of technologies sooner compared to baby boomers. Net farm income, percentage changes in debt-to-asset ratio, corn to total crop acres and machinery investment had no significant impact on the time-to-adoption for both information-intensive and embodied-knowledge technologies. On the other hand, while variations exist, time-to-adoption of PA technologies is mainly driven by location of farm, generation of farmer, number of workers, years of farming experience, total acres cropped and the cost of crop insurance.Originality/valueThis study investigates how the financial position of farms, amongst other important factors might influence time-to-adoption of PA technologies. Results are useful to extension personnel and retailers for planning marketing or farm outreach programs taking into consideration that, time-to-adoption differs across regions and by specific characteristics, key amongst them: generation of farmer, number of workers, years of farming experience, total acres cropped and the cost of crop insurance.

Do firms use early guidance to disclose the effect of conservatism on future earnings?

2019 ◽  
Vol 18 (3) ◽  
pp. 432-455
Author(s):  
Carlo D’Augusta ◽  
Giulia Redigolo
Keyword(s):  
Voluntary Disclosure ◽  
Past Research ◽  
Financial Reports ◽  
Content Type ◽  
Future Earnings ◽  
The Difference ◽  
Earnings Trends ◽  
Annual Earnings ◽  
The Cost ◽  
Manager Incentives

Purpose By deferring profits and anticipating losses, conservatism makes earnings increases more persistent and earnings declines more likely to revert. Therefore, the level of conservatism in current earnings has implications for future earnings expectations. Past research shows that outsiders can fail to understand these implications. This paper aims to investigate whether firms help outsiders by voluntarily disclosing their expectations about how conservatism will affect future earnings trends. Design/methodology/approach The authors examine the likelihood and content of “early” earnings guidance – i.e. guidance about future earnings that is released around or before the announcement of current earnings. The sample is made of 8,820 annual earnings announcements, 62 per cent of which are combined with early guidance. Findings The authors find that the more conservative current earnings, the higher: the likelihood that the firm releases early guidance; the likelihood that the firm predicts a positive change in earnings; and the difference between the forecasted earnings and current earnings. The authors also find such guidance to be relevant to analysts, who use it to update their forecasts. Practical implications By showing that firms use early guidance to disclose the effect of conservatism on future earnings, the study is interesting to users and preparers because it shows that analysts need and use such disclosure; and regulators because it alleviates concerns about the information consequences of conservatism. Originality/value The findings show that firms do not refrain from committing to positive early guidance to disclose the earnings effects of conservatism. This is interesting in light of the difficulty of predicting such effects, the manager incentives to keep expectations low and the cost of committing to positive guidance instead of less risky qualitative disclosure alternatives. In this way, the authors contribute to the literature on the interrelation between voluntary disclosure and conservatism in financial reports.

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