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Behavioral Finance Biases in Investment Decision Making
Muhammad Atif Sattar,
Muhammad Toseef,
Muhammad Fahad Sattar
Issue:
Volume 5, Issue 2, June 2020
Pages:
69-75
Received:
11 September 2019
Accepted:
27 March 2020
Published:
14 April 2020
Abstract: Traditional finance suggests that investments made by rational behaviors investors examine risk and return before decision making to gain maximum profit later behavioral finance challenge traditional finance and introduce psychological factors affect decision making. The aim of this research paper is to explore how behavioral biases affect investment decision making under uncertainty. Dependent variable investment decision making is a composite activity, it never be made in a vacuity by depending on personal resources. Based on this study investment choices alternatives influence by human rational and irrational behavior, therefore, examine the impact of behavioral finance in the decision-making process. Behavioral finance phenomenon variables; heuristic, prospects, personality characteristics, feeling, moods and ecological factors explore under this research. Overconfidence, Representativeness, Anchoring, Regret Aversion, Hindsight, Herding Effect and Home Bias included in investors psychology behaviors. Survey questionnaire tool used to collect sample to conduct quantitative research. To test the hypothesis Regression analysis run by the SPS software. Findings revealed that there was an effect of behavioral biases on investment decisions. Empirical results concluded investment decision making influenced by heuristic behaviors more than prospects and personality characteristics. The originality of this study, it is very beneficial for investors and financial institutions to make decision by observation of psychological factors.
Abstract: Traditional finance suggests that investments made by rational behaviors investors examine risk and return before decision making to gain maximum profit later behavioral finance challenge traditional finance and introduce psychological factors affect decision making. The aim of this research paper is to explore how behavioral biases affect investme...
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The Implementation of Risk Management in Malaysian Public Sector to Sustain Federal Government’s Revenue
Ahmad Shukri Abdul Gani,
Basariah Salim,
Noraza Mat Udin
Issue:
Volume 5, Issue 2, June 2020
Pages:
76-83
Received:
23 February 2020
Accepted:
23 March 2020
Published:
14 April 2020
Abstract: The purpose of this paper is to examine the implementation of a risk management framework and process in the Malaysian public sector, particularly in the main collector agencies of the Federal Government of Malaysia (FGOM). The sustainability of the government’s financial situation became a concern among the public. The scrapped goods and services tax (GST), the reintroduction of the sales and services tax (SST) and level of national debt triggered various responses. The public expects the government to identify the risks systematically and take action to minimize the impact. Thus, the government should implement risk management to enhance the effectiveness of public sector financial management. The research method involved administering a questionnaire to five main revenue collector agencies of the FGOM. The respondents were staff members holding senior and middle positions in the accounts, finance, and revenue collection department or unit of the agencies. The significant findings on the extent of risk management in the Malaysian public sector were still not practiced systematically. The risk management framework was not sufficient and the risk management processes were not embedded to ensure that staff across the organization collaborate and co-operate to manage risks. In the Malaysian context, written policies should be published to practice risk management systematically in the public sector since it is the critical success factor in implementing any system in the government. The policies should be followed by further guidelines in phases to improve risk management implementation.
Abstract: The purpose of this paper is to examine the implementation of a risk management framework and process in the Malaysian public sector, particularly in the main collector agencies of the Federal Government of Malaysia (FGOM). The sustainability of the government’s financial situation became a concern among the public. The scrapped goods and services ...
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Improvement will Come from Industry Leaders in Global Financial Structure
Issue:
Volume 5, Issue 2, June 2020
Pages:
84-92
Received:
19 February 2020
Accepted:
9 March 2020
Published:
14 April 2020
Abstract: In this study, I aim to give special emphasizes on the status of Industry Leaders. I want to highlight the role of ignored but crucial associations specifically, Panel of Scholars, Groups of Donors, Research Clusters, Export Processing Zones Associations, Chambers of commerce & Industries Association, Experienced Business Professionals and Educational Institutions in shaping the global financial structure. Their involvement has great importance in the procedure of financial growth, because they have the power to answer the present change and to capture the current development in the business world. My purpose to examine the global financial structure was not to going behind the schedule but to focus on the power and importance of industry leaders and discover the solution of how to help the deprived citizen, how to use and manage the natural resources and what the motives of financial structure to shape it in better form. I want to make the Industry Leaders conscious about their supremacy, so that they could guide the both developed and developing countries to increase the international flow of capital and enlarge the earning through plenty of natural resources present in our universe, so that nobody would die without medicine and every one could get education in our world.
Abstract: In this study, I aim to give special emphasizes on the status of Industry Leaders. I want to highlight the role of ignored but crucial associations specifically, Panel of Scholars, Groups of Donors, Research Clusters, Export Processing Zones Associations, Chambers of commerce & Industries Association, Experienced Business Professionals and Educatio...
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Determinants of Smallholder Farmers’ Saving: The Case of Omo Microfinance Institution in Gimbo District of Kaffa Zone, Southern Ethiopia
Issue:
Volume 5, Issue 2, June 2020
Pages:
93-100
Received:
4 September 2019
Accepted:
26 October 2019
Published:
17 April 2020
Abstract: Despite the importance of saving to both savers and financial institution, different household and institutions related factors separated a lot of farmers from saving in Microfinance institutions. This study was conducted with specific objectives: to identify factors affecting farmers’ saving in microfinance institution and to assess challenges and opportunities in microfinance service provision in the Gimbo district of Kaffa zone, Southern Ethiopia. The study was based on the data collected from 200 sample households selected through two-stage sampling technique. Both descriptive statistics and econometric model were used to analyze the data. A Tobit model was used to assess the determinants of households’ saving. Econometric model result showed that education level, land size, farm income, household expenditure, distance from service provision center, and perception on interest rate were found to be significant in influencing the households’ saving in Omo micro-finance. Low loan recovery performance, low saving mobilization, lack of office facilities, lack of awareness on services and lack of coordination with other government sectors were major challenges in microfinance service provision in the district. The result suggests the need of microfinance institution and concerned government bodies playing role regarding improving saving culture of households through financial literacy, modernization of working procedures in saving service provision, and reviewing the saving interest rate for encouraging farmers to save.
Abstract: Despite the importance of saving to both savers and financial institution, different household and institutions related factors separated a lot of farmers from saving in Microfinance institutions. This study was conducted with specific objectives: to identify factors affecting farmers’ saving in microfinance institution and to assess challenges and...
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Responsibility Accounting and Profitability of Listed Companies in Nigeria
Adegbie Folajimi Festus,
Urewa Ochai-Adejoh,
Owolabi Babatunde Ayodeji
Issue:
Volume 5, Issue 2, June 2020
Pages:
101-117
Received:
24 February 2020
Accepted:
13 April 2020
Published:
28 May 2020
Abstract: Structuring activities into responsibility centers and optimization of resource is a priority in meeting investors’ performance and profitability expectations in both small and large organizations. Studies have shown that to meet these expectations, adequate performance evaluation and reward system are managers’ challenges. This study investigated the effect of responsibility accounting on profitability of listed companies in Nigeria. Ex-post facto research design was adopted. The population was 173 quoted companies on the Nigerian Stock Exchange as at 31st December 2016. Ten companies were selected using stratified and purposive sampling technique. Data were extracted from published financial statements of sampled companies; validity and reliability of the data were premised on the scrutiny of the external auditors. Descriptive and inferential (Panel data regression) statistics were used to analyze the data. The study revealed that profitability measured by NPBT, of listed companies in Nigeria is significantly influenced by responsibility accounting (RA), F-Stat=114.56, AdjR2=.0.6964, p=0.000. There is no significant difference in the result of NPBT with and without the control variable of firm size. The result with control variables revealed F-Stat=87.63; AdjR2=0.7242; P=0.000. The study also revealed that RA had a positive significant relationship with EPS with control variables of firm size, F-Stat=6.56, AdjR2=0.1442; P=0.000. However, without control variables, no significant effect of responsibility accounting on EPS was observed as shown in the following result: F-Stat=0.45, AdjR2=-0.0112, p=0.64. Furthermore, the study revealed that profitability measured by ROA exhibited an insignificant relationship with RA given the following results, AdjR2=0.0089; P=0.000. RA with control variables of firm size, insignificantly affected ROA while Firm Size exerted significant positive effect on ROA (as the size of the firm changes by a unit, ROA increased by 23.9% as seen in model 3b) given the following result: AdjR2=0.0399; P=0.782. This study concluded that responsibility accounting had an influence on profitability of listed companies in Nigeria. The study recommended that since profitability is the whole essence of responsibility accounting, managers should ensure delegation of task with responsibilities clearly spelt out, regular appraisal process, achievable project budgeting, instituting cross functional teams and efficient reward systems put in place towards achieving the corporate objective that would influence better profitability.
Abstract: Structuring activities into responsibility centers and optimization of resource is a priority in meeting investors’ performance and profitability expectations in both small and large organizations. Studies have shown that to meet these expectations, adequate performance evaluation and reward system are managers’ challenges. This study investigated ...
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