Risk and Return of the KLSE Finance Stocks and the Performance of Banking Stocks in Malaysia
The purpose of this study is to investigate the relationship between risk and return of fifty Finance Stocks listed on the Main Board of Kuala lumpur Stock Exchange for the period of 30th May 1995 to 30th May 1997. In addition to this objective, the performance of Big Five local Banks in relatio...
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| Format: | Project Paper Report |
| Language: | English English |
| Published: |
1997
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| Online Access: | http://psasir.upm.edu.my/id/eprint/7901/1/GSM_1997_18_A.pdf http://psasir.upm.edu.my/id/eprint/7901/ |
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| Summary: | The purpose of this study is to investigate the relationship between risk
and return of fifty Finance Stocks listed on the Main Board of Kuala
lumpur Stock Exchange for the period of 30th May 1995 to 30th May 1997.
In addition to this objective, the performance of Big Five local Banks in
relations to the KlSE FinanCe Index is also analyzed using the
Performance Measurement Indices of Sharpe, Treynor and Jensen.
The study found that during the above period, the Maybank stock is the
least riskiest finance stocks in the top Five local Banks. For other
finance stocks, Phileo Allied Berhad is the riskiest security while Bank
Islam Malaysia Berhad is least riskiest. The return for Finance Stocks is
60% more than the return on the Composite Index as reflected by the Beta
Coefficient. Finance Stocks have high positive correlations relative to the
Composite Index.
The study has also corraborates the hypothesis that the return of
securities with high betas to be greater than the returns of the securities
with low betas, consistent with risk-return theoretical relationship. |
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