scholarly journals A Conceptual Framework for Islamic Institutional and Retail Investment in Maritime Assets

2018 ◽  
Vol 11 (2) ◽  
pp. 176
Author(s):  
Adam Abdullah ◽  
Rusni Hassan ◽  
Salina Kassim
Keyword(s):  
Conceptual Framework ◽  
Private Equity ◽  
Debt Financing ◽  
International Shipping ◽  
Retail Investors ◽  
Equity Finance ◽  
Alternative Sources

The purpose of this research is to provide a conceptual framework for Islamic institutional and retail investment in maritime assets. Our objectives are to provide an introduction to seaborne trade and analyze trends in institutional interest in alternative assets and international shipping as well as highlight Islamic and conventional equity structures for institutional and retail investors. Our findings reveal that an Islamic private equity framework involving an unlevered, tax-free investment in maritime assets provides a real alternative to conventional lending and even successful tax-efficient conventional equity structures, since they are not entirely without issues given the significant presence of debt financing from maritime banks. There is a demand for alternative sources of finance, such that Islamic equity finance, rather than conventional lending or structured debt can develop international shipping involving Islamic institutional and retail investment in maritime assets.

De-equitisation will boost share prices but hit capex

2021 ◽  
Keyword(s):  
Interest Rate ◽  
Initial Public Offerings ◽  
Private Equity ◽  
Business Models ◽  
Debt Financing ◽  
Equity Financing ◽  
Content Type ◽  
Public Offerings ◽  
Share Prices ◽  
Retail Investors

Significance More merger and acquisition (M&A) activity, shareholder activism and earnings-enhancing share buyback programmes have more than offset the supply of new equity from initial public offerings (IPOs). Institutional investors are increasingly seeking higher returns from alternative assets such as private equity and a rising number of companies now have capital-light business models. Impacts Greater interest from retail investors could boost demand for shares in companies with smaller market capitalisations. Rising concentration in many industries will attract interest from anti-trust authorities, particularly technology, retail and transport. If rising inflation eventually triggers interest rate increases, debt financing will be less attractive compared to equity financing.

scholarly journals Leveraged Buyouts and Private Equity

2009 ◽  
Vol 23 (1) ◽  
pp. 121-146 ◽  
Author(s):  
Steven N Kaplan ◽  
Per Strömberg
Keyword(s):  
Time Series ◽  
Empirical Evidence ◽  
Private Equity ◽  
Debt Financing ◽  
Leveraged Buyouts ◽  
Leveraged Buyout ◽  
The Future ◽  
Similarities And Differences ◽  
Investment Firm ◽  
A Company

In a leveraged buyout, a company is acquired by a specialized investment firm using a relatively small portion of equity and a relatively large portion of outside debt financing. The leveraged buyout investment firms today refer to themselves (and are generally referred to) as private equity firms. We describe and present time series evidence on the private equity industry, considering both firms and transactions. We discuss the existing empirical evidence on the economics of the firms and transactions. We consider similarities and differences between the recent private equity wave and the wave of the 1980s. Finally, we speculate on what the evidence implies for the future of private equity.

A real asset management approach for Islamic investment in containerships

2020 ◽  
Vol 11 (1) ◽  
pp. 27-48
Author(s):  
Adam Abdullah ◽  
Rusni Hassan ◽  
Salina Kassim
Keyword(s):  
Asset Management ◽  
Profit Sharing ◽  
Content Type ◽  
International Shipping ◽  
Investment Appraisal ◽  
Debt Finance ◽  
Equity Finance ◽  
Management Institutions ◽  
The Impact ◽  
Islamic Investment

Purpose The purpose of this paper is to provide a real asset management investment appraisal of the performance of containerships as a primary segment within international shipping, to facilitate Islamic equity investment through a shipping fund. The objectives are to evaluate the risks and returns of shipping under the framework of Islamic equity finance, and to analyze the performance of investing in containerships over the long term, to appeal to retail and institutional clients of Malaysian asset management institutions. Design/methodology/approach Accordingly, the methodology adopts an investment analysis of a full population of historical data over a period of 20 years, to evaluate performance involving a maritime return on investment (MROI), internal rate of return (IRR), net yield and standard deviation measures of risk and return. Findings The findings reveal that while earnings are volatile in comparison to capital market expectations, unlevered, tax-free returns on containership investments outperform financial and other real assets. Research limitations/implications Shipping is a strong growth industry with about 84 per cent of global trade carried out by the international shipping industry. The problem is that many Islamic asset management institutions and investors have essentially no exposure to Islamic investment in international shipping. Practical implications However, shipping is a highly capital-intensive industry, and currently 75 per cent of ship lending has been conducted by European banks and financed on a conventional basis. Post-financial crisis, ship owners, ship lenders and shipyards have all been exposed to the impact of over-levered balance sheets and debt finance. There is a demand for alternative sources of finance. Social implications By communicating risk and reward more effectively, retail and institutional investors, as well as Islamic finance institutions, will realize that the social benefit of equity finance on the basis of profit sharing is more efficient at allocating investible resources than debt finance at interest, thereby increasing investment and economic growth. Originality/value The significance is that Islamic equity finance, rather than debt at the time-value of money, should enhance the development of international shipping.

scholarly journals Same same, but different: capital structures in single family offices compared with private equity firms

2021 ◽  
Author(s):  
Antonia Schickinger ◽  
Alexandra Bertschi-Michel ◽  
Max P. Leitterstorf ◽  
Nadine Kammerlander
Keyword(s):  
Private Equity ◽  
Order Theory ◽  
Debt Financing ◽  
Single Family ◽  
Firm Age ◽  
Pecking Order ◽  
Pecking Order Theory ◽  
Financial Decisions ◽  
Financing Choices ◽  
The Relationship

AbstractDespite the increasing interest in single family offices (SFOs) as an investment owned by an entrepreneurial family, research on SFOs is still in its infancy. In particular, little is known about the capital structures of SFOs or the roots of SFO heterogeneity regarding financial decisions. By drawing on a hand-collected sample of 104 SFOs and private equity (PE) firms, we compare the financing choices of these two investor types in the context of direct entrepreneurial investments (DEIs). Our data thereby provide empirical evidence that SFOs are less likely to raise debt than PE firms, suggesting that SFOs follow pecking-order theory. Regarding the heterogeneity of the financial decisions of SFOs, our data indicate that the relationship between SFOs and debt financing is reinforced by the idiosyncrasies of entrepreneurial families, such as higher levels of owner management and a higher firm age. Surprisingly, our data do not support a moderating effect for the emphasis placed on socioemotional wealth (SEW).

scholarly journals Analysis of Pre-existing Investment Behavior and Influence of Trading Apps

2021 ◽  
Vol 10 (4) ◽  
Author(s):  
Anish Guddati ◽  
Dhruva Bhat
Keyword(s):  
Private Equity ◽  
Industrial Revolution ◽  
Status Quo ◽  
Investment Behavior ◽  
Stock Trading ◽  
Behavioral Biases ◽  
Wharton School ◽  
The Us ◽  
Retail Investors ◽  
The Status

The last few years have seen a rise in trading apps, and Robinhood is one trading app that has attracted millennials. This paper explores trading apps such as Robinhood and their role in providing financial inclusion and safe trading opportunities. This paper discusses investment behavior in the status quo, explaining overconfidence, sociability, and the disposition effect. Investment behavior can include the behavioral biases and common notions investors utilize for trading. Furthermore, this paper assesses the design and business model of Robinhood. Five expert investors were interviewed (such as a professor and other MBA graduates from Wharton School of Business, financial experts from private equity firms in the US and Mexico, and a JP Morgan investment banking professional), and five casual investors were interviewed to understand their opinions on investment behavior, certain trading apps, common criticisms of stock trading, and solutions to these concerns. The findings led to the conclusion that investment behavior is harmful in the status quo. Results did indicate that Robinhood does promote at least some dangerous behavior through excessive active trading and is one example of a problematic trading app through the 4th Industrial Revolution, but trading apps can only amplify behavioral biases most retail investors already display.

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