Precious Metals as Hedge and Safe-Haven for African Stock Markets

2021 ◽  
Author(s):  
Muhammad Naeem ◽  
Abraham Agyemang ◽  
Md Iftekhar Hasan Chowdhury ◽  
Mudassar Hasan ◽  
Syed Jawad Hussain Shahzad
Keyword(s):  
Stock Markets ◽  
Precious Metals ◽  
Safe Haven

The role of precious metals in extreme market conditions: evidence from stock markets

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Sinem Guler Kangalli Uyar ◽  
Umut Uyar ◽  
Emrah Balkan
Keyword(s):  
Stock Market ◽  
Stock Markets ◽  
Global Financial Crisis ◽  
Precious Metals ◽  
Market Condition ◽  
Time Varying ◽  
Safe Haven ◽  
Stock Market Returns ◽  
Content Type ◽  
Gold Silver

Purpose The purpose of this paper is to scrutinize three different points: How safe haven properties of precious metals (gold, silver, platinum and palladium) differentiate in two recent major crises such as the Global Financial Crisis (GFC) and the COVID-19 pandemic? How safe haven properties of precious metals change by the severity and the duration of shocks? and whether precious metals have hedge properties or not in normal conditions against different stock markets. Design/methodology/approach To analyze the time-varying behavior of precious metals with respect to stock market returns, the authors used the rolling window approach. After obtaining the time-varying beta series that way, the authors regressed the beta series on different severities of stock market shocks. Findings The findings show that the number of safe haven precious metals increases in the COVID-19 pandemic period compared to the GFC. Furthermore, the number of safe haven precious metals increases as the severity of shocks increases and the duration of them extended. Finally, in the absence of an extreme market condition, only gold has strong hedge asset properties. Originality/value To the best of the authors’ knowledge, this study is the first that examines the safe haven and hedge properties of all tradable precious metals against seven major stock markets. Besides this, it presents a comparative analysis for the safe haven properties of precious metals in terms of two major crises.

scholarly journals WTI OIL SHOCKS IN EASTERN EUROPEAN STOCK MARKETS: A VAR APPROACH

2021 ◽  
Author(s):  
Rui Dias ◽  
◽  
Hortense Santos ◽  
Paula Heliodoro ◽  
Cristina Vasco ◽  
...  
Keyword(s):  
Stock Markets ◽  
Oil Prices ◽  
Oil Price ◽  
Portfolio Diversification ◽  
Oil Shocks ◽  
Eastern European ◽  
Safe Haven ◽  
Wald Tests ◽  
Stock Indices ◽  
European Stock Markets

The 2020 Russia-Saudi Oil Price War was an economic war triggered in March 2020 by Saudi Arabia in response to Russia’s refusal to reduce oil production to keep oil prices at a moderate level. In view of these events, this study aims to analyze oil shocks (WTI) in the eastern European stock markets, namely the stock indices of Hungary (BUX), Croatia (CROBE), Russia (MOEX), Czech Republic (PRAGUE), Slovakia (SAX 16), Slovenia (SBI TOP), Bulgaria (SOFIX), from September 2019 to January 2021. The results show mostly structural breakdowns in March 2020, while the VAR Granger Causality/Block Exogeneity Wald Tests model shows two-way shocks between oil (WTI) and the stock markets analyzed. These findings show that the hypothesis of portfolio diversification may be called into question. As a final discussion, we consider that investors should avoid investments in stock markets, at least as long as this pandemic last, and rebalance their portfolios into assets considered “safe haven” for the purpose of mitigating risk and improving the efficiency of their portfolios.

scholarly journals Desain Finite State Automata Untuk Merancang Vending Automata Logam Mulia

2021 ◽  
Vol 8 (2) ◽  
pp. 113
Author(s):  
Susanto Susanto ◽  
Venny Yulianty ◽  
Bobby Suryo Prakoso ◽  
Suwanda Suwanda ◽  
Windu Gata ◽  
...  
Keyword(s):  
Internet Of Things ◽  
Precious Metals ◽  
The Internet ◽  
Finite State Automata ◽  
Safe Haven ◽  
Vending Machines ◽  
Keywords Internet ◽  
Finite State ◽  
Modern Era ◽  
The Internet Of Things

Abstrak: Menabung logam mulia merupakan investasi yang dianggap safe haven, ditengah era modern saat ini menabung logam mulia dapat dilakukan dengan cara dicicil, sedangkan yang menjadi masalahnya adalah kekhawatiran ketika fisik logam mulia tidak dapat ditarik fisiknya yang membuat potensi fraud atau investasi bodong yang sedang marak saat ini, untuk mengatasi masalah itu penjualan logam mulia dapat dikembangkan menjadi lebih menarik dengan vending machine, untuk memperdalam pemahaman mengenai salah satu model komputasi yang mendasar dan pengenalan Internet of Things (IoT), desain vending machine ini akan menggunakan metode finite state automata (FSA). Dengan desain finite state automata, penelitian ini telah menghasilkan desain vending machine logam mulia berbasis Internet of Things (IoT) dari cara login ke vending machine sampai fisik logam mulia dapat diterima. Produk penjualan logam mulia dengan menggunakan vending machine ini diharapkan dapat menjangkau masyarakat lebih luas untuk berinvestasi, khususnya logam mulia.   Kata kunci: Internet of Things, logam mulia, vending machine   Abstract: Saving gold is an investment that is considered a safe haven, in the midst of today's modern era saving gold can be done in installments, while the problem is the concern when the physical gold cannot be physically withdrawn which creates the potential for fraud or fraudulent investments that are currently rampant. to overcome this problem the sale of precious metals can be developed to be more attractive with vending machines, to deepen understanding of one of the fundamental computing models and the introduction of the Internet of Things (IoT), this vending machine design will use the finite state automata (FSA) method. With the design of finite state automata (FSA), this research has resulted in the design of a gold vending machine based on the Internet of Things (IoT) from how to login to the vending machine until the gold is physically acceptable. The product selling gold using vending machines is expected to reach a wider audience to invest, especially gold.   Keywords: Internet of Things, precious metals, vending machine

Religion vs ethics: hedge and safe haven properties of Sukuk and green bonds for stock markets pre- and during COVID-19

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Muhammad Abubakr Naeem ◽  
Mustafa Raza Rabbani ◽  
Sitara Karim ◽  
Syed Mabruk Billah
Keyword(s):  
Stock Markets ◽  
Economic Stress ◽  
Low Risk ◽  
Sufficient Evidence ◽  
Safe Haven ◽  
Socially Responsible ◽  
Content Type ◽  
Hedge Ratios ◽  
Regulatory Bodies ◽  
Investment Portfolios

Purpose This study aims to examine the hedge and safe-haven properties of the Sukuk and green bond for the stock markets pre- and during the COVID-19 pandemic period. Design/methodology/approach To test the hedge and safe-haven characteristics of Sukuk and green bonds for stock markets, the study first uses the methodology proposed by Ratner and Chiu (2013). Next, the authors estimate the hedge ratios and hedge effectiveness of using Sukuk and green bonds in a portfolio with stock markets. Findings Strong safe-haven features of ethical (green) bonds reveal that adding green bonds into the investment portfolios brings considerable diversification avenues for the investors who tend to take fewer risks in periods of economic stress and turbulence. The hedge ratio and hedge effectiveness estimates reveal that green bonds provide sufficient evidence of the hedge effectiveness for various international stocks. Practical implications The study has significant implications for faith-based investors, ethical investors, policymakers and regulatory bodies. Religious investors can invest in Sukuk to relish low-risk and interest-free investments, whereas green investors can satisfy their socially responsible motives by investing in these investment streams. Policymakers can direct the businesses to include these diversifiers for portfolio and risk management. Originality/value The study provides novel insights in the testing hedge and safe-haven attributes of green bonds and Sukuk while using unique methodologies to identify multiple low-risk investors for investors following the uncertain COVID-19 pandemic.

Safe haven, hedge and diversification for G7 stock markets: Gold versus bitcoin

2020 ◽  
Vol 87 ◽  
pp. 212-224 ◽  
Author(s):  
Syed Jawad Hussain Shahzad ◽  
Elie Bouri ◽  
David Roubaud ◽  
Ladislav Kristoufek
Keyword(s):  
Stock Markets ◽  
Safe Haven

scholarly journals The intertemporal relation between expected returns and conditional correlations between precious metals and the stock market

2018 ◽  
Vol 7 (1) ◽  
pp. 24
Author(s):  
Ryuta Sakemoto
Keyword(s):  
Stock Market ◽  
Empirical Evidence ◽  
Stock Markets ◽  
Precious Metals ◽  
Asset Market ◽  
Market Condition ◽  
Expected Returns ◽  
Trade Off ◽  
Conditional Correlations

This study explores whether conditional correlations between precious metals and stock markets impact upon expected returns on precious metals. The empirical evidence presents that there is no significant trade–off between conditional correlations and expected returns, which means that high returns on precious metals are not related to a lack of diversification benefits. Interestingly, high absolute values of conditional correlations lead to increases in expected returns, suggesting that the unstable cross-asset market condition is associated with the expected returns. This impact is stronger on silver than on gold.  

Are ESG stocks safe-haven during COVID-19?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ghulame Rubbaniy ◽  
Ali Awais Khalid ◽  
Muhammad Faisal Rizwan ◽  
Shoaib Ali
Keyword(s):  
Portfolio Choice ◽  
Stock Markets ◽  
Robustness Analysis ◽  
Wavelet Coherence ◽  
Safe Haven ◽  
Health Crisis ◽  
Content Type ◽  
Hedging Strategies ◽  
Stock Indices ◽  
Wavelet Coherency

Purpose The purpose of this study is to investigate safe-haven properties of environmental, social and governance (ESG) stocks in global and emerging ESG stock markets during the times of COVID-19 so that portfolio managers and equity market investors could decide to use ESG stocks in their portfolio hedging strategies during times of health and market crisis similar to COVID-19 pandemic. Design/methodology/approach The study uses a wavelet coherence framework on four major ESG stock indices from global and emerging stock markets, and two proxies of COVID-19 fear over the period from 5 February 2020 to 18 March 2021. Findings The results of the study show a positive co-movement of the global COVID-19 fear index (GFI) with ESG stock indices on the frequency band of 32 to 64 days, which confirms hedging and safe-haven properties of ESG stocks using the health fear proxy of COVID-19. However, the relationship between all indices and GFI is mixed and inconclusive on a frequency of 0–8 days. Further, the findings do not support the safe-haven characteristics of ESG indices using the market fear proxy (IDEMV index) of COVID-19. The robustness analysis using the CBOE VIX as a proxy of market fear supports that ESG indices do not possess safe-haven properties. The results of the study conclude that the safe-haven properties of ESG indices during the ongoing COVID-19 pandemic is contingent upon the proxy of COVID-19 fear. Practical implications The findings have important implications for the equity investors and assetty managers to improve their portfolio performance by including ESG stocks in their portfolio choice during the COVID-19 pandemic and similar health crisis. However, their investment decisions could be affected by the choice of COVID-19 proxy. Originality/value The authors believe in the originality of the paper due to following reasons. First, to the best of the knowledge, this is the first study investigating the safe-haven properties of ESG stocks. Second, the authors use both health fear (GFI) and market fear (IDEMV index) proxies of COVID-19 to compare whether safe-haven properties are characterized by health fear or market fear due to COVID-19. Finally, the authors use the wavelet coherency framework, which not only takes both time and frequency dimensions of the data into account but also remains unaffected by data stationarity and size issues.

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