Exchange Market Research Articles

The Early Warning of Financial Failure for Iraqi Banks Based on Robust Adaptive Lasso Logistic Regression

It is well known that there are many mathematical financial failure models that have been proposedin the financial literature for specific stock markets. Some researchers are not aware these mathematical modelswere constructed to be fitted for that market data, not for other markets. Iraq stock market exchange is one of thesemarkets in which the researchers used imported models such as Kida, Sherrod, Altman, and others to predictfinancial failure. Therefore, the development of a financial failure warning model for banks has become verycrucial for the Iraqi bank sector in the stock market exchange. Unfortunately, there is no clear information aboutthe financial failure of Iraqi banks as a response variable, and the financial indicators contain outliers. Theobjective of this paper is to propose an algorithm to know the performance of efficient and inefficient banks basedon their indicators during specific time periods. The output of this algorithm will be considered as responsevariables. Then, a weighted adaptive lasso logistic regression algorithm that has a high breakdown point is used totackle outliers’ problem. Thirteen banks have been chosen as the most traded during the period (2010-2017), andfor each bank (27) financial indicators were collected. Our proposed model is compared with adaptive lassologistic regression by using Deviance, Misclassification, Area Under Curve, Mean Square Errors, and MeanAbsolute Errors. Consequently, the results showed that the weighted Adaptive Lasso Logistic Regression model ismore robust and relevant than others to be a financial model to warn of the failure of the banks in Iraq's stockmarket.

The changing performance of inbound tourism under the fluctuation of the Renminbi exchange rate

In the context of the information age in the post epidemic period, China's inbound tourism is increasingly recovering, and related tourism products are gradually coming into the view of foreign consumers. The development of tourism is an important way to promote international relations and improve international influence, while the exchange rate plays an irreplaceable role as one of the important influencing factors of international trade. In addition, the exchange rate reflects the price conversion index between the two countries can effectively explain the international economic situation and the continuous reform of the exchange rate system on China's foreign exchange market has caused different impacts, the exchange rate fluctuations of the RMB may be outside the part of the population with the intention of coming to China to cause a certain impact. In order to explore the impact of exchange rate fluctuations on the inbound tourism industry, this paper combines the background of the post-epidemic period with a view to empirically analysing the issue through macro data, and then exploring the changes in China's inbound tourism market under the fluctuation of the RMB exchange rate from multiple perspectives, as well as the transmission mechanism of exchange rate fluctuations on the inbound tourism market. Ultimately, it will provide certain reference value for the Chinese government and the related tourism industry, so as to effectively promote the development of China's tourism industry and improve China's international influence.

MODERATING EFFECT OF INFLATION RATES ON THE RELATIONSHIP BETWEEN FOREIGN EXCHANGE RATES AND STOCK PRICES IN THE KENYAN CAPITAL MARKET

<p>There has been a downward trend in the equities market with NSE 25, NASI, and NSE 20 declining by 9.9%, 3.5%, and 5.7% respectively from 2012 to 2015 and 2017. Ever since the Shilling was allowed to float freely, the unpredictability of Nairobi’s exchange market has been largely observed and in 2006 February, the index in NSE 20-Share rose to 4057, 2007 January it went further to 5774, but in February 2009 it hit a low of 2475. The drop went further in 2011 by 27%. This brought about losses to investors for example in 2009 when brokerage firms collapsed. This has led to a loss of confidence in investors in the Nairobi Securities; and for this reason, researchers have to come in and work together to find ways of stabilizing our stock market. This research seeks to add value to the literature by analyzing whether the regulation of the interaction of inflation rates with exchange rates on stock prices will stabilize the undesirable situation. Stock market plays an important role of intermediation in the economy and enhancing investors’ confidence in the market can have a positive impact on resource allocation hence economic growth. Reviewed literature has found the effects both in the short-run and the long-run. The disparity of their results might be attributed to different countries that are being analyzed on different capital mobilities, economic links, trade volumes, and methodologies among others. This study established the moderating effect of inflation rates on the relationship between foreign exchange rates and stock prices. The study is built on the theory of stock prices. The research adopted a correlational research design. Time series monthly secondary data was collected from January 1998 to December 2018. Multivariate analysis was employed. The 2-step hierarchical regression which resulted in an R<sup>2 </sup>change of 3% was fairly a good increase in the predictive capacity for stock price changes. The study therefore concluded that Inflation Rates moderate the relationship between stock prices and exchange rates and recommends that the Central Bank of Kenya as the regulator and Capital Markets Authority (CMA) should consider formulating favorable policies to manage Inflation rates as it is an investment driver in the economy.</p><p><strong> </strong></p><p><strong>JEL</strong>: E31; D53; E44</p><p> </p><p><strong> Article visualizations:</strong></p><p><img src="/-counters-/soc/0603/a.php" alt="Hit counter" /></p>

Research And Analysis of IPO underpricing In the Market with Chinese Characteristics

This paper mainly introduces and popularizes science about IPO underpricing and discusses the characteristics and future development direction of China's securities market. This paper introduces the opinions of domestic and foreign scholars on the IPO underpricing phenomenon from different angles. Finally, through the analysis and summary of resources integration, this paper discusses how to deal with the new strategy of high underpricing rate, and further expounds the future direction of national efforts in the stock exchange market. This paper finds that there is a significant IPO price suppression phenomenon in China's A-share market, which is the IPO issue price of the stock is significantly lower than its listing price. This paper points out the negative impact of IPO price suppression on the effective operation of the securities market, and deeply analyzes the reasons for the existence of IPO price suppression in China.

The History of Fed Interest Rate Hikes and the Impact on Stock and Foreign Exchange Markets

Following COVID-19, America uses policies to boost its economy, inadvertently pushing inflation from 2018 to 2022. This paper discusses the history of the Federal Reserve rate increase and its repercussions on financial areas, especially on the stock and foreign exchange markets. The main analysis centers on the impacts of the markets and behaviors of the answers. Initially, the Federal Reserve rate increase seemed economically beneficial. However, long-term effects may negatively impact both domestic and international economies to some degree. By examining historical data, this paper dissects the rationale behind such moves and their direct outcomes. This offers a better perspective on potential future interest rate influences. For investors, to be positive and need to adjust their investment strategies to adapt when they face the Federal Reserve rate increase. For policymakers, during the fluctuations in interest rates, they need to maintain the global equilibrium as far as possible, without excessive disruption or impact.

Hedging Strategies with Derivatives after 2020

This paper examines the changes in the futures market and how Chinese companies have hedged in recent years. As is known to all, the world has experienced lots of events, such as the COVID-19 pandemic, the Ukraine Conflict, the economic recession, and the rising interest rate in the U.S. Under the risky circumstances, the foreign exchange market and commodity futures market have shown a larger volatility. During times of global economic turmoil, the investors in the financial markets are seeking opportunities to protect their investment portfolios and assets. Historically, the futures market can be seen as a safe haven for funds, mitigating losses caused by fluctuations in stock or commodity prices through proper hedging strategies. This paper analyses what the Chinese futures and spot markets are like and how Chinese companies use hedging tools to lock profits. Then, the paper gives suggestions and prospects for futures hedging and the development of markets.

Understanding Monetary Policy Communication in a Small and Open Economy Under an Exchange Rate Anchor: The Case of North Macedonia

ABSTRACT The aim of this paper is to provide insights into the readability, structure, and tone of monetary policy communication in the case of the National Bank of the Republic of North Macedonia (NBRNM), a small and open economy operating under an exchange rate anchor. The results indicate the NBRNM generally communicates with a neutral tone while its communication is complex in terms of syntax and structure. The dominant topic is inflation and financial markets, followed by monetary policy, economic growth, and the foreign exchange market. Further, topic proportions and tone are analyzed in relation to key macroeconomic indicators.

What influences the dynamic spillovers of China’s financial market uncertainties?

ABSTRACT Uncertainty serves as a significant source of volatility in financial markets. The aim of this study is to examine the spillover effects of China’s financial market uncertainties (capital market, currency market, foreign exchange (FX) market and derivatives market) and their potential determinants. A large amount of economic and financial data is selected as the sample dataset to construct the financial uncertainty index by the combination of the stochastic volatility model and the Markov chain Monte Carlo algorithm. The TVP-VAR-DY model and the extreme bounds analysis model are also used to conduct spillover and determinant analyses. The results indicate that uncertainties in capital and currency markets primarily act as transmitters of spillover effects. The derivatives market uncertainty mainly serves as a recipient of influence from other markets, whereas the role of FX market uncertainty is relatively unstable. Moreover, international factors such as global economic policy uncertainty and the implied volatility index (VIX) have a more robust impact on spillover relationships among the four financial uncertainties, whereas domestic factors have the greater impact intensity.

Analyzing the Relationship Between the Fed Interest Rates and Foreign Exchange Markets

The research on analyzing the relationship between fed interest rates and foreign exchange markets aims to establish how fed interest rates and foreign exchange rates are related based on capital flow between different countries. The research is to answer the question of how changes in federal interest rates affect capital flow between other countries since it affects the foreign exchange market. The research reviews various scholarly journals as a source of literature on previous studies done within the research area. The methodology to be applied is the empirical research approach. Data is to be collected from verified journals and research papers. Linear aggression is the data analysis method for the research, and XSLAT software will be used in data analysis. Independent and dependent variables will be developed based on the research objectives to help the study. Secondary analysis using linear aggression has been preferred because of how reliable, time-saving and cost-effective. The expected results from the research show that changes in federal interest rates affect the flow of capital since foreign exchange is implicated. Factors such as currency value and economic level influence federal interest rates and foreign exchange.

Competitive Pricing Strategy of Wind-Solar-Fire Coupling System in Monthly Concentrated Market Considering the Uncertainty of Renewable Energy

Monthly centralized bidding is a key link in the transition from annual bilateral trading to spot trading, the research object of this paper is the multi-type power system (coupling system) which is integrated and coupled by thermal power and renewable energy under the same grid point, from the market point of view, this paper discusses its competitive strategy and revenue in the monthly centralized bidding market. First, an outer-level market clearing model that adapts to the participation of the coupling system is constructed to maximize the clearing in terms of social welfare. Secondly, considering the forecast error of scenery, the optimization model of the inner coupling system is established to analyze the cost of the coupling system, and the increment of the coupling system is evaluated quantitatively. Finally, a two-layer optimization model for coupling system to participate in the monthly centralized bidding market is formed, and then the optimal operation strategy of coupling system is studied. The simulation verification of the calculation example shows that participating in the monthly centralized bidding transaction in the mode of the coupling system will increase the income of each of the scenery and fire, the proposed coupling system model promotes changes in the energy structure of the power market, driven by improving the overall economic benefits, ensuring the economic benefits of traditional units and expanding the scope of the renewable energy market, so as to provide electricity to renewable energy and thermal power to improve auxiliary services. The development of the situation provides new ideas for the large-scale grid-connected consumption of new energy.

The interdependence and risk transmission between southward, northward capital and China’s stock, foreign exchange market

This paper mainly studies the interdependence structure and risk transmission between China’s north–south capital flow and the stock market and foreign exchange market. The results show that the correlation between southward capital and the mainland stock market is stronger, and the correlation between northward capital and the Hong Kong stock market is stronger. The correlation between northward capital and RMB exchange rate is greater than that between southward capital and RMB exchange rate. After the outbreak of COVID-19, the correlation between capital flows and the stock market has strengthened, while the correlation with the foreign exchange market has weakened. Furthermore, there is a bidirectional risk transmission between the north–south capital flow and China’s stock market and foreign exchange market. In general, the north–south capital flow has a greater impact on the stock market, and the exchange rate of RMB/US dollar has a greater impact on the north–south capital flow. This study has implications for investors and policymakers.

Financial Statement Analysis of Expedia and TCO before and after COVID-19

Due to the outbreak of the epidemic, the global economic situation has been greatly affected, among which the two most serious impacts are the fluctuations of the global financial market and the regression of the global tourism industry, whether it is the sharp decline of the stock market or the foreign exchange market, or the travel ban of many countries and the suspension of major airlines. All of these have led to severe turmoil in the global economy, so how to recover the economy has become a particularly critical global issue. In this paper, the financial statements of two well-known travel companies, Expedia and TCOM, are theoretically analyzed and calculated. It can be clearly seen that the post-epidemic economic recovery is remarkable when the epidemic is in progress, and the two companies are expected to reach the pre-epidemic peak point or even exceed the peak point in the next five years through discounted cash flow calculations.

Do received remittances cause Dutch disease in developed and developing countries?

PurposeThe present study aimed to examine the effect of received remittance inflows on the price level ratio of the purchasing power parity conversion factor to the market exchange rate in 36 developed and developing countries from 2004 to 2020.Design/methodology/approachThe panel data conducted a comparative analysis and used panel least squares, regression with Driscoll-Kraay standard errors of fixed effect, random effect, feasible generalised least squares and maximum likelihood robust least squares to overcome the heterogeneity issue. Furthermore, the two-step difference generalised method of moments to overcome the endogeneity issue. Diagnostic tests were used to increase robustness.FindingsIn the studied countries, there was a statistically significant negative relationship between received remittance inflows and the price-level ratio of the purchasing power parity conversion factor to the market exchange rate. This relationship explains why remittance flows depreciate the real exchange rate. The study’s results also indicated that attracting investments can improve the quality of institutions despite high tax rates, leading to low tax revenue.Originality/valueThe current study findings enrich the understanding of policies of how governments should minimise tariff rates on capital imports and introduce export-oriented incentive programmes. The study also revealed that Dutch disease can occur due to differences in the demand structure and manufacturing development policy.

PASAR MODAL SYARIAH

This research aims to find out about the sharia capital market. This research method uses a literature study approach sourced from books according to the topic and focuses on research. The results of the literature review in this research conclude that the Islamic capital market is a capital market whose entire activity mechanism, especially regarding issuers, the types of securities traded and the trading mechanism is in accordance with sharia principles. The capital market or stock exchange has been around since the Dutch colonial era and to be precise in 1912 in Batavia. The capital market plays a role in carrying out two functions simultaneously, namely an economic function and a financial function. Legal entities in carrying out sharia capital market activities are regulated by Bapepam-Lk.

From Barter to Market: an Agent-Based Model of Prehistoric Market Development

Despite interest in preindustrial markets, archaeological discussions have largely been limited to proposing methods to determine the presence or absence of market exchange in ancient societies. While these contributions are important, methodological limitations have prevented theoretical considerations of the emergence and evolution of marketplaces and market exchange in prehistory. We propose that agent-based modeling provides a window to explore physical conditions and agent behaviors that facilitate the emergence of customary exchange locations and how such locations may evolve into socially embedded institutions. The model we designed suggests that simple bartering rules among agents can generate concentrated locations of exchange and that spatial heterogeneity of resources is the most important factor in facilitating the emergence of such locales. Furthermore, partner-search behaviors and exchange of information play a key role in the institutionalization of the marketplace. The results of our simulation suggest that marketplaces can develop, even with the absence of formalized currency or central planning, as a consequence of collective strategies taken up by agents to reduce exchange partner-search costs and make transactions more frequent and predictable. The model also suggests that, once established as a social institution, marketplaces may become highly conservative and resistant to change. As such, it is inferred that bottom-up and/or top-down interventions may have often been required to establish new marketplaces or relocate marketplaces to incorporate new resources, resolve supply–demand imbalances, or minimize rising economic costs that arise as a result of social, political, and economic change.

Analisis Pengelolaan Valuta Asing Serta Pasar Valuta Asing Di Indonesia

Muamala Fikh's research requires justification for currency transactions, because buying and selling foreign currency is closely related and cannot be separated from the functioning of the world economy. Foreign currency refers to foreign currencies such as US dollars, pounds sterling and ringgit. An efficient foreign exchange market means exchange rates will change in the future. Unpredictable. The marketing activities of international companies are often organized as separate and independent departments within the company.

Pre, During and Post Covid-19 Stock Returns and Volatility Comparison:

This study aims to study the pre, during and post-COVID-19 stock returns and volatility associated with Pakistan. For this study, daily financial data from 2018 to 2023. This study is based on daily prices and their returns. The data was divided into categories like Category A: Before the COVID-19 pandemic, Category B: during the COVID-19 pandemic and Category C: Post COVID-19 pandemic. The indices period is from 1st January 2018 to 25th February 2020 (Pre Covid-19), 26th February 2020 to 31st December 2021 (during Covid-19) and from 1st March 2022 to 8th May 2023 (Post Covid-19) period. The data were treated with Descriptive and Econometric Models using E-views, Microsoft Excel and SPSS. The findings of this research are that there is no stationarity issue in all the returns’ series, and the average return for Pre (Category A) and Post Covid periods (Category C) is positive; however, it is negative During the Covid period (Category B) which shows the bearish trend in Pakistan Stock Exchange market (PSX) due to the Covid-19 outbreak. Moreover, the coefficient of variation (CV) is computed, which shows that pre-COVID tenure has the highest relative dispersion (CV = 44.43), followed by during COVID (CV = 40.76), and post-COVID tenure has the most negligible coefficient of relative dispersion (CV = 23.1) which refers to the least volatile phenomenon. The findings also suggest no statistically significant difference among all average returns, and all are equal. The results from the econometric model show that the highest mean reversion value was 0.969991 During the COVID period. Post-COVID has a value of 0.449377, which indicates the quick mean reversion compared to the other two.

Constraints on provisioning at public versus private community banks

AbstractWe compare the responses of publicly held versus privately held community banks to the June 2016 issuance of the current expected credit loss (CECL) standard, which altered the way US banks provision for loan losses. We find that following issuance but before implementation, the relation between earnings and provisions strengthened among privately held banks but not among publicly held banks. This is consistent with US Securities and Exchange Commission regulation and market monitoring placing greater constraints on publicly held banks relative to privately held banks, preventing publicly held banks from moving toward the CECL standard early.

ОРГАНІЗОВАНІ ТОВАРНІ РИНКИ У СИСТЕМІ РИНКОВИХ ВІДНОСИН

The article highlights the concept of an organized form of trade. The economic essence of organized commodity markets is expressed through the prism of the market relations formation. It is noted that organized commodity markets occupy a prominent place in the market economy system due to their functions and economic purpose. The classification of organized commodity markets depending on the types of commodity assets is given, including agricultural markets, markets of metals, energy resources, timber and other assets. It was noted that organized commodity markets evolved over many centuries, therefore they adapted in their development certain joint achievements, as well as individual characteristics that arose on the basis of historically formed traditions, social and legislative norms, the formation of economic relations. The economic essence of organized commodity markets in the modern system of the market economy, which provides for the provision of an organized form of trade in commodity and financial markets, is defined. It is noted that the concept of "organized trade" can be replaced by the concept of "exchange trading", and "organized market" by the concept of "exchange market". It was determined that the characteristic features of an organized form of trade are the presence of an exchange infrastructure, specific rules of exchange trading. as well as the possibility of standardizing the parameters of exchange assets. An important place in the organized commodity market is given to organized platforms or commodity exchanges. The commodity exchange is a market institution that provides an efficient market environment for transparent pricing and forecasting of price risks. It was established that the importance of organized trade in commodity assets stems from the functional purpose of the organized commodity market due to the provision of: formation of a competitive environment in the market of real assets; transparent pricing of raw materials; price risk management mechanism; effective redistribution of financial resources; access to an open information environment. It has been established that the characteristic features of modern organized commodity markets are: electronicization; globalization; financialization; universalization.

Lay economic reasoning: An integrative review and call to action

AbstractConsumer psychology refers to how people think and act within an economic role in market exchange. However, we know little about how consumers actually perceive these roles, or how they understand markets and economic activity more broadly. That is, we lack an understanding of the economic reasoning of non‐expert consumers, how it departs from formal economic reasoning, and why. The current paper is intended to address this gap. We provide an integrative review of research on lay economic reasoning that consistently reveals how differently lay consumers and economists think about markets. We propose a unifying mental model to explain these divergences. Suggest why it is reinforced by what lay consumers observe (and do not observe) through firsthand marketplace experience, and note its potential evolutionary basis. We then highlight how understanding lay economic reasoning can not only help explain a wide array of marketplace phenomena, but also provide a novel lens to help advance, generate, and better integrate theory across many active literatures within consumer psychology. Without markets, there are no consumers and there is no marketing. We therefore call for consumer psychologists to take ownership of the study of lay economic reasoning and make markets more central to marketing scholarship.