Managing a Shariah-Compliant Capital Protected Fund through Turbulent Times

2019 ◽  
Vol 17 (1_suppl) ◽  
pp. S32-S41 ◽  
Author(s):  
Ferhana Ahmad ◽  
Fazal Jawad Seyyed ◽  
Hafsa Ashfaq
Keyword(s):  
Financial Crisis ◽  
Global Financial Crisis ◽  
Strategic Choices ◽  
Risk Appetite ◽  
Asset Value ◽  
Turbulent Times ◽  
Net Asset Value ◽  
Equity Funds ◽  
The Global Financial Crisis ◽  
Positive Return

The case examines the performance and challenges faced by the Meezan Capital Protected Fund (MCPF) ensuing from the global financial crisis of 2008. The MCPF launched in May 2008 was the first-ever Shariah-compliant capital protected fund (CPF) offered in Pakistan targeted at conservative investors seeking principal protection along with upside exposure to equities through Shariah-compliant products and securities. The case is based on the scenario, the fund manager, Farhan Lakhani, is facing in early July 2009 following the colossal decline in stock markets crushing investor confidence in the financial system. Unlike equity funds, which had experienced an unprecedented drop in value during this period, MCPF had not only preserved its capital but also managed to generate a small positive return of over 1 per cent in terms of net asset value. Farhan sets out to capitalize on the extraordinary opportunity created by the financial crisis for CPFs to carve out a permanent space among an assortment of funds to mitigate risk for investors with low-risk appetite. He has to carefully review and analyse some of the key strategic choices to enhance the fund’s returns to meet investor expectations as equity markets recover from their historic lows; share his recommendation with the investment committee in two days.

17 Towards a Unified Theory for Private Investment Funds

2018 ◽  
Author(s):  
Spangler Timothy
Keyword(s):  
Financial Crisis ◽  
Hedge Funds ◽  
Private Equity ◽  
Global Financial Crisis ◽  
Financial Innovation ◽  
Private Investment ◽  
Investment Fund ◽  
Investment Funds ◽  
Equity Funds ◽  
The Global Financial Crisis

This chapter considers future legal and regulatory responses to private investment funds in the context of a country’s current political dynamics. It begins with a discussion of the regulatory policy issues surrounding private investment funds before and after the global financial crisis, criticisms against private equity funds and hedge funds, and lessons from the Alternative Investment Fund Managers Directive. It then examines indirect regulation of private investment funds as a way forward, along with financial innovation and regulatory arbitrage. In particular, it explains how the global financial crisis has exposed the complexity of modern financial markets, noting that one of the primary drivers of this complexity has been financial innovation. The chapter concludes by analysing investor-centric approaches to addressing the governance challenge present in private investment funds.

scholarly journals Global Financial Crisis: Lessons Learned

2010 ◽  
Author(s):  
Nor Hayati Bt Ahmad
Keyword(s):  
Financial Crisis ◽  
Global Financial Crisis ◽  
Lessons Learned ◽  
Moral Hazards ◽  
Banking Regulations ◽  
Asset Value ◽  
Financial Speculation ◽  
The Global Financial Crisis ◽  
Loan Growth ◽  
Financial Environment

A financial crisis appears to occur in a certain pattern; it usually starts with a rally of bank credits against a backdrop of easier monetary policy, ample liquidity, and more relaxed banking regulations. Such financial environment stimulates excess leverage to fund assets in real estates and housing in which consumers take advantage of cheap money and borrow heavily, while bankers zealously lend out in order to achieve high loan growth targets. As with all levered instruments, this practice generates great profits when the asset value rises. In contrast, it produces great losses when the assets fall in value, forcing lenders to ration credits and to compete aggressively for funds to cover the resultant losses. Retrospectively, the Global Financial Crisis exhibits far reaching implications from the excessive leverage, deregulation and from the spiral effects of globalisation, financial speculation, product innovation, moral hazards, and incentives problems. This paper reflects how similar or different the Global Financial Crisis is from the past crises in terms of its causes and manifestations, how Malaysia was impacted, and what key lessons could be learned from it.   Keywords: Financial crisis; risk taking and banking.

On the formation of a New Paradigm of fiscal Policy

2013 ◽  
pp. 152-158 ◽  
Author(s):  
V. Senchagov
Keyword(s):  
Public Finance ◽  
Fiscal Policy ◽  
Financial Crisis ◽  
Global Financial Crisis ◽  
Domestic Demand ◽  
Real Economy ◽  
New Paradigm ◽  
Monetary Aggregate ◽  
The Past ◽  
The Global Financial Crisis

Due to Russia’s exit from the global financial crisis, the fiscal policy of withdrawing windfall spending has exhausted its potential. It is important to refocus public finance to the real economy and the expansion of domestic demand. For this goal there is sufficient, but not realized financial potential. The increase in fiscal spending in these areas is unlikely to lead to higher inflation, given its actual trend in the past decade relative to M2 monetary aggregate, but will directly affect the investment component of many underdeveloped sectors, as well as the volume of domestic production and consumer demand.

ASPEK ETIK DAN SISTEMIK DALAM EKONOMI DAN BISNIS ISLAM

ALQALAM ◽  
2014 ◽  
Vol 31 (1) ◽  
pp. 187
Author(s):  
Budi Harsanto
Keyword(s):  
Financial Crisis ◽  
Business Ethics ◽  
Moral Hazard ◽  
Global Financial Crisis ◽  
Financial Institution ◽  
Research Question ◽  
Academic Journals ◽  
Lehman Brothers ◽  
The World ◽  
The Global Financial Crisis

The fall of Enron, Lehman Brothers and other major financial institution in the world make researchers conduct various studies about crisis. The research question in this study is, from Islamic economics and business standpoint, why the global financial crisis can happen repeatedly. The purpose is to contribute ideas regarding Islamic viewpoint linked with the global financial crisis. The methodology used is a theoretical-reflective to various article published in academic journals and other intellectual resources with relevant themes. There are lots of analyses on the causes of the crisis. For discussion purposes, the causes divide into two big parts namely ethics and systemic. Ethics contributed to the crisis by greed and moral hazard as a theme that almost always arises in the study of the global financial crisis. Systemic means that the crisis can only be overcome with a major restructuring of the system. Islamic perspective on these two aspect is diametrically different. At ethics side, there is exist direction to obtain blessing in economics and business activities. At systemic side, there is rule of halal and haram and a set of mechanism of economics system such as the concept of ownership that will early prevent the seeds of crisis. Keywords: Islamic economics and business, business ethics, financial crisis 

Mobilising resiliency in times of economic hardship: Emerging themes in migrant worker remittance payments

2014 ◽  
Vol 7 (2) ◽  
pp. 159-167
Author(s):  
Kevin Garlan
Keyword(s):  
Financial Crisis ◽  
Global Financial Crisis ◽  
Migrant Worker ◽  
Economic Hardship ◽  
Priority Areas ◽  
Mobile Payments ◽  
Payment Methods ◽  
The Future ◽  
Emerging Themes ◽  
The Global Financial Crisis

This paper analyses the nexus of the global financial crisis and the remittance markets of Mexico and India, along with introducing new and emerging payment technologies that will help facilitate the growth of remittances worldwide. Overall resiliency is found in most markets but some are impacted differently by economic hardship. With that we also explore the area of emerging payment methods and how they can help nations weather this economic strife. Mobile payments are highlighted as one of the priority areas for the future of transferring monetary funds, and we assess their ability to further facilitate global remittances.

The Pandemic Exposes an Ailing US Governance Model

2020 ◽  
Vol 119 (820) ◽  
pp. 310-316
Author(s):  
Alasdair Roberts
Keyword(s):  
Financial Crisis ◽  
Developing World ◽  
Global Financial Crisis ◽  
Political Polarization ◽  
Washington Consensus ◽  
The Past ◽  
Governance Model ◽  
Governance Challenges ◽  
The Global Financial Crisis ◽  
Current Governance

Since the 1990s and Bill Clinton’s embrace of key parts of Ronald Reagan’s legacy, mainstream US governance has been guided by a bipartisan consensus around a formula of shrinking the federal government’s responsibilities and deregulating the economy. Hailed as the ultimate solution to the age-old problem of governing well, the formula was exported to the developing world as the Washington Consensus. Yet growing political polarization weakened the consensus, and in a series of three major crises over the past two decades—9/11, the global financial crisis, and the COVID-19 pandemic—US policymakers opted for pragmatism rather than adherence to the old formula, which appears increasingly inadequate to cope with current governance challenges.

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