UNCERTAINTY AVOIDANCE, RISK AVOIDANCE AND PERCEIVED RISK: A CULTURAL PERSPECTIVE OF INDIVIDUAL INVESTORS

Risk serves as an important aspect that can change the decision making of individuals, especially if it is related to investment decision making. The effects of risk on investment decision making have been extensively discussed in the literature but little of it assessed the dominance of various risk-related factors in investment decision making by individuals. In order to make up for this lack,  this research studies the impact of risk avoidance,  uncertainty avoidance and perceived risk on the investment intentions of individual investors in Pakistan and relate it to Hofstede’s cultural dimension. The data was collected from individual investors and after screening, a sample of 548 was found useable for further analysis. Using SEM-PLS, it was found that risk avoidance and uncertainty avoidance significantly influence the investment intention of individual investors. On the other hand perceived risk does not influence the investment intentions of individual investors. In the evaluation of dominating factors, it was found that   risk avoidance is the most significant and the strongest factor that influences the individual investors’ investment intentions. This paper suggests that investment managers should work on strategies to change the risk avoidance behaviour of investors. Moreover, findings suggest that the cultural aspect is more important, and the level of risk avoidance should be kept in mind while offering stocks in the market. The Security Exchange Commission of Pakistan can prepare risk-adjusted products to enhance the level of intentions among the individual investors in Pakistan

Islamic bond and the wealth effects: Evidence from Malaysia

The fast growing of Islamic bonds issuance in Malaysia and worldwide, coupled with the lack of corporate finance literature that integrates the development of lslamic capital market motivate us to study the wealth effects of Islamic debt oferings and their determinants. It is found that the market reaction is significantly positive during event windows -3, 0 and -3, 3 surrounding the announcements of lslamic debt issuance. Five variables suggested by the capital structure literature, namely firms size (SIZE), issue size (AMT), leverage (LEV), free cash flows (FCF) and investment opportunity (Te) together with two new variables, the syariah compliant status (SYAR) and the Security Commission's (SC) approval (APPROVAL) were modeled as potential explanatory variables of the wealth effects.The analysis conclude that the wealth effect of lslamic bond issuance announcements is positively influenced by the issuer S investment opportunity and negatively influenced by the issue size, ,firm size and whether the announcement is accompanied by the SC approval. The finding implies that the positive reaction is not due to investors ' preference for Islamic compliant activities but it is due to similar factors,found in studies on conventional bonds.The negative influence of SC approval on the wealfh efect indicates that many listed companies issuing lslamic debt are not complying with the information disclosure requirement

Perbandingan antara tabung perniagaan kecil seliaan kerajaan dan pinjaman biasa dari perspektif pegawai bank

The Malaysian government has established various types of funds to cater the needs of small and medium industry (SMI). These funds are made available to entrepreneur through participating financial institutions such as commercial banks and development financial in institutions. Thc success of commercial banks in their roles, among others depends on certain characteristics of the people that are actually dealing with the funds. This article highlights the perceptions of commercial bank officers on several aspects of both ordinary loans and loans given from the government funds. Opinions sought from these officers include factors relating to the administration of the funds, the profitability of the funds, the contribution of the funds to job promotion, and the tendency of the loan under the funds becoming problematic loans. Divergence of opinions between branch managers and credit oficers, as well as between officers in town/metropolitan areas and rural areas, are investigated. Findings from this study would be useful to various parties, especially the government and financial institutions, in making the financial assistance programme for small and medium scale entreprises a successful endeavour

Understanding the nature of dropouts in MFIs: Evidence from rural Bangladesh

The present study aims to comprehend the nature of drop out from the microfinance institutes (MFIs) in Bangladesh.To this aim, the research incorporates several variables ranging from the demographic to demandled factors that may affect the dropping out behavior of the rural poor in MFIs.Multiple regression model has been used to analyze the data (n = 280) that are collected from the dropout-members from six regions of Bangladesh.The findings demonstrate that eleven of fourteen explanatory variables including the demographics are statistically significant to influence the dropping out behavior of the dropouts in rural Bangladesh

Examining the impact of product involvement, subjective norm and perceived behavioral control on investment intentions of individual investors in Pakistan

This study aims to examine the impact of product involvement, subjective norm and perceived behavioral control on investment intentions of individual investors in Pakistan. The data were collected from 548 individual investors in Pakistan using systematic random sampling. The data analysis was done using descriptive and inferential statistics. The results of the analysis showed that product involvement and subjective norm have a significant impact on investment intention of individual investors in Pakistan. On the other hand, the perceived behavioral control appears as insignificant in influencing the investment intentions of individual investors. The results of the analysis can be helpful for the investment advisors in efforts to increase the level of involvement. They need to develop and promote customized investment portfolios for their customers that suit their risk profile, investment objectives and financial constraints

Banks’ Participation in Small Enterprise Financing: Problems and Issues in Bangladesh

The economic and social importance of Small Enterprise (SE) sector nowadays is well acknowledged in academic and policy literature. SEs play a very momentous role in all countries including the developing economy like Bangladesh by contributing toward sustainable economic growth, employment creation, entrepreneurship development and export earnings. Focussing on the small enterprises’ lack of access to finance due to their own constraints as well as the financial institutions’ perception of high risk and high cost, this paper reveals the problems encountered by the small enterprises in obtaining loans from commercial banks in Bangladesh and the major problems faced by commercial banks while financing small enterprises. Primary data collection reaches three hundred forty one (341) small enterprises where they were interviewed using a set of questionnaires administrated directly by the researchers. The survey results indicate that 65.39% enterprises received loans from banks, while the rest did not receive any loan, and from other results it enables the researchers to conclude that the small enterprises face several problems in obtaining loans from banks. It is evident that high interest rate is the most significant problem followed by excessive security and guarantee requirement, working capital requirement, complexity of documentation, non availability of loan in due time,  non availability of the required amount, banker's reluctance and negligence, and mal-practices of bank officials. For the bank category, 22 different commercial bank managers were interviewed guided by the questionnaire, they have cited different problems related to the small enterprise financing, of which non availability of required documentation, absence of good record of transactions, bad repayment history, lack of financial capacity, lack of security and guarantee are very common. Based on the survey findings, a set of recommendations has been formulated for policy initiatives. Government and other related bodies should intensify their efforts to provide low cost funds to the commercial banks, FIs may concentrate on finding collateral substitute loan, documents issuing authorities should ease the process of getting documents, IT based loan approval procedures may be adopted to reduce loan processing time, banks have to adopt better internal control and governance mechanism to reduce malpractices, stakeholders should organize training activity to educate the SEs in recording business transactions, Government, should take initiative for building a good relationship between businessmen and bankers etc. may be considered to solve the prevailing problems. Key words: Small enterprises, Access to finance, Commercial banks, Banglades

Market and companies confidence index and their relation with stock return

This paper analyzes the relationship between market confidence and stock return.In addition, it also aims to analyze the relationship between company’s confidence and stock return. Based on principal component analysis (factor analysis), a confidence index will be developed for the Kuala Lumpur stock exchange with data from 2000 to 2010. The sample consisted of companies listed on Kuala Lumpur stock exchange which will be grouped into quartiles, each representing a portfolio.Next, the average return of each portfolio for every quarter is going to be calculated.Finally, the results will indicate a significant and negative or positive relationship between the market as well as company’s confidence index and the stock return

Effect of Board Diversity on Financial Performance of Firms in Malaysia: A Moderating Role of Corporate Sustainability Practices

The volatile financial performance (FP) of listed firms in Bursa Malaysia has been observed since 2008. The total earnings by companies in FTSE Bursa Malaysia KLCI index in 2016 dropped by 30 percent showing unusual performance pattern among the listed firms. Both FTSE Bursa Malaysia KLCI and EMAS index year on year capital return performance are also found negative from 2014 to 2016. The declining FP of firms is often associated with weak corporate governance (CG) practices. The board diversity (BD) under CG mechanisms induces the improvement of FP and long-term success of a firm. Since BD impacts on FP, this study proposes a conceptual framework by introducing corporate sustainability practices (CSP) to see how it moderates the relationship between BD and FP. The conceptual framework offers useful information which may help for further investigating in BD and FP. The future studies should validate empirically the proposed research framework. Keywords: Corporate Sustainability Practices, Board Diversity, Financial Performance, Stakeholder Theory, Bursa Malaysia. DOI: 10.7176/JESD/10-10-12 Publication date:May 31st 201

The pitfalls in entrepreneurship and small business research: A holistic view

The academic and practical interest in the field of small business and entrepreneurship has recently gained considerable attention. However, an important area of concern within this field has been to find appropriate and suitable research approach or technique that could assist the researchers to produce positive research outcomes.Many researches in this field have been conducted without paying attention to some of their unique characteristics.Therefore, this study identifies and documents various pitfalls associated with these types of researches.It also offers the guidelines and important considerations for researchers in this area with the intention of reducing future weaknesses