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Revised Malaysian Shariah screening: Its impact on Islamic capital market

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dc.contributor.affiliationsFaculty of Economics and Muamalat
dc.contributor.affiliationsUniversiti Sains Islam Malaysia (USIM)
dc.contributor.authorNor F.M.en_US
dc.contributor.authorShaharuddin A.en_US
dc.contributor.authorMarzuki A.en_US
dc.contributor.authorRamli N.A.en_US
dc.date.accessioned2024-05-28T08:26:02Z
dc.date.available2024-05-28T08:26:02Z
dc.date.issued2019
dc.description.abstractShariah Advisory Council (SAC) of Securities Commission (SC) formulated a new revised Shariah screening methodology of two-tier quantitative assessment for activity-based screening benchmarks and the newly- formulated financial ratio benchmarks, while the qualitative assessment remains the same. The revised methodology is an effort to expand the Islamic capital market's (ICM) international reach which is in line with the SC objectives. The objective of this paper is to examine the impact of the recent announcement of new changes in the Shariah screening methodology by the Malaysian Securities Commission on the share prices of the affected companies and Islamic capital market. We use an event study method to see if the changes have a significant reaction from the market, specifically, from investors and fund managers. On the announcement date, that is, on 29 November 2013, 158 non-Shariah compliant stocks were removed from the previous list of Shariah compliant stock that was issued in May 2013 and 16 stocks were added to the approved list. Out of 158 non-Shariah compliant stocks, only 137 stocks are available for the analysis. For the new Shariah compliant stocks, only 16 stocks are included in the sample. We find an immediate but short lived negative impact on the stock returns towards the deletion, but none towards the addition of new stocks to the Shariah index. However, the announcement has no significant impact on the overall return of the FBM Emas Shariah index.en_US
dc.description.natureFinalen_US
dc.identifier.doi10.5430/rwe.v10n1p17
dc.identifier.epage30
dc.identifier.issn19233981
dc.identifier.issue1
dc.identifier.scopus2-s2.0-85071195320
dc.identifier.spage17
dc.identifier.urihttps://www.scopus.com/inward/record.uri?eid=2-s2.0-85071195320&doi=10.5430%2frwe.v10n1p17&partnerID=40&md5=d7563115b092a48497744c259f2eee07
dc.identifier.urihttps://www.sciedu.ca/journal/index.php/rwe/article/view/15626
dc.identifier.urihttps://oarep.usim.edu.my/handle/123456789/8702
dc.identifier.volume10
dc.languageEnglish
dc.language.isoen_USen_US
dc.publisherSciedu Pressen_US
dc.relation.ispartofOpen Accessen_US
dc.sourceScopus
dc.sourcetitleResearch in World Economy
dc.subjectIslamic capital marketen_US
dc.subjectIslamic financeen_US
dc.subjectShariah screeningen_US
dc.titleRevised Malaysian Shariah screening: Its impact on Islamic capital marketen_US
dc.title.alternativeRes. World Econ.en_US
dc.typeArticleen_US
dspace.entity.typePublication

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