Terms Of Market Capitalization Research Articles

An Empirical Assessment of the Impact of Nigerian all Share Index, Market Capitalization, and Number of Equities on Gross Domestic Product

A stock exchange is an exchange where stock brokers and traders can buy and sell shares of stock, bonds, and other securities. All listings are included in the Nigerian Stock Exchange All Shares index. In terms of market capitalization, the Nigerian Stock Exchange is the third largest stock exchange in Africa. Objectives: The paper assesses the impact of Nigerian Stock Market (all share index, market capitalization, and number of equities) on Gross domestic product (Economic Growth). Materials and Methods: Regression analysis and ordinary least square technique were employed. Result and Discussion: The series was stationary at 1%, 5%, and 10% α level; the residuals were normally distributed but not serially correlated at 5% α level. All Share Index, Market Capitalization and Total Number of listed Equities have a joint and individual significant effect on Economic Growth (Gross Domestic Product) with Total Number of listed Equities having a negative (opposite) linear relationship with the Gross Domestic Product. The Durbin-Watson statistics (R2 = 0.9910 = 1.3686) suggest that the model is not spurious and it is devoid of positive and negative autocorrelation (DW = 1.3686 > dl = 1.07 and DW = 1.5033 - du = 2.17). Therefore, it can produce meaningful result when used for forecasting a positive relationship between gross domestic product, all share index and market capitalization with a 99.1% R-square value. Significant Positive connection between all share index, market capitalization, the number of equities and gross domestic product suggests that government policies and bills aimed towards rapid development of the capital market should be initiated.

АНАЛІЗ ОСОБЛИВОСТЕЙ ІННОВАЦІЙНОЇ ДІЯЛЬНОСТІ ФАРМАЦЕВТИЧНИХ ПІДПРИЄМСТВ НА РИНКУ УКРАЇНИ

The article analyzed the peculiarities of the pharmaceutical industry in Ukraine, its structure. Unlike other areas of the domestic economy, during the period of Ukrainian independence the pharmaceutical industry developed quite dynamically, more or less successfully overcoming economic crises, which Ukraine experienced. The pharmaceutical market belongs to the group of highly competitive and mature markets in Ukraine. This is largely due to innovative activities of modern pharmaceutical companies. The specificity of the pharmaceutical field, the difference of medicines from other goods on the market and the dependence of pharmaceuticals on the dominant model of medicine of a particular market (country) determines the uniqueness of the innovation process of the enterprises of the pharmaceutical market. The relevance of the research is due to the need to further increase the innovation potential of the domestic pharmaceutical industry, as it is directly related to the health of nations. The article identified the subjects of economic relations of the pharmaceutical market, which constitute it. The capacity of the pharmaceutical market was considered and the main key factors of its success were identified (innovation, product portfolio, sales development, new markets, modernization of fixed assets). The top 20 global innovative companies in terms of market capitalization are presented. The features of innovative activity of modern pharmaceutical companies such as: PAT "Farmak", PAT "Scientific-production center" Borshchagivskiy chemical-pharmaceutical plant", Corporation "Arterium", LLC "FK "Health", PF "Darnitsa", LLC "Kusum Pharm", PF "Viola". The classification of innovations in terms of possible directions and capital intensity of innovation activities in the pharmaceutical field was analyzed. The article also examined the structure of costs for external and internal research and development by pharmaceutical companies. The volume of investment in R&D (Research and Development ) by different pharmaceutical companies was analyzed.

Young Stakeholders’ Perception of Public Companies Responsibility: An Empirical Study on Business-to-Customer Markets

The present research aims to investigate business-to-customer Italian public companies and their relationship with young stakeholders. The focus is to analyse the correlation between young stakeholders’ perception of company environmental and social sustainability and the market capitalisation. The approach of the present research has been used to structure the literature and to conduct an empirical analysis on a sample of public companies chosen among the Italian larger 150 in terms of market capitalisation. Through a qualitative research based on focus groups and individual interviews, a sample of 33 public companies has been selected and tested by using an online survey of 420 Italian youth. The analysis of firms’ young stakeholders’ responsibility perception has taken to confirm those authors and managers sustain that the more the firm market capitalization is, the more the organization is perceived as responsible.

Kingpins, Bottlenecks, and Value Dynamics Along a Sector

This paper explores the dynamics of value distribution within a sector, using data on the U.S. computer industry as an illustration. It provides exploratory quantitative evidence for the way in which conditions within the segments of a sector’s value chain affect the profitability of those segments compared with the sector as a whole. To consider how value shifts from one part of the sector (such as computer assemblers) to another (such as software and microprocessor makers), we look at how conditions within a segment (such as software developers) affect changes in the value share of that segment compared with the entire sector in terms of market capitalization. We find that the presence of what we call “kingpins”—firms with superior capabilities, modeled in our study as having superior market capitalization and as being disproportionately important in terms of research and development (R&D)—is correlated with a higher share of total sector value, suggesting that kingpins can help a segment to become a “bottleneck.” Sales concentration and the level of R&D expenditure are not always reliable predictors. Kingpins exert a positive externality on their direct competitors, yet their segments display increasing internal inequality over time, making the presence of kingpins a double-edged sword for their peers. Our findings extend recent work on industry architectures, highlighting the interconnectedness of different segments within a sector. They also provide a structure to help study the dynamics of “value migration,” which has not yet attracted much academic scrutiny.

Dividend Policy, Ownership Structure and Corporate Governance: An Empirical Analysis of Indian Firms

In this article, we investigate the possible association between the firm's ownership structure and dividend policy and whether the corporate governance (CG) practices adopted by the firm have any impact on dividend policy. In India the presence of family-run firms, with concentrated ownership, is a reality and we try to understand whether such firms have any significantly different approach to dividend policy compared to non-family-run companies.The use of debt by firms in their capital structure acts as an additional monitoring mechanism and we propose to analyse whether this has any impact on dividend policy.We explore the determinants of dividend policy of Indian firms. Thus, firm characteristics which seem to have an impact on dividend policy, like profitability, liquidity, growth, income volatility, size and age are investigated. We use a panel of 51 top Indian listed firms, in terms of market capitalisation (BSE 100 and NIFTY 100), over the 5-year period from 2007–2008 to 2011–2012 for our analysis.We conclude that the CG variables, namely, board size, independent directors and the proportion of non-executive directors on the board have significant impact on the dividend policy of the firm.The proportion of cash and cash equivalent to total asset, used as a measure of firm liquidity, also has an influence on the dividend policy. Growth opportunities have a positive influence on the dividend policy of firms.

Phd Thesis: International Perspective: The Impact of Corporate Social Responsibility Reports on Analysts' Coverage and Forecast Properties: Evidence from Ft Global 500

Phd Thesis: International Perspective: The Impact of Corporate Social Responsibility Reports on Analysts' Coverage and Forecast Properties: Evidence from Ft Global 500

The Contextual Prediction of South African Equity Returns Using Fundamental Analysis

Purpose: The premise underlying the practice of fundamental analysis is that accounting numbers are relevant to the prediction of security returns. The theoretical foundation for this proposition is well established. However, empirical evidence is less clear on whether a contextual partition of the securities universe, on the basis of value-growth or other characteristics, is a necessary precondition for the efficacy of fundamental analysis. This paper investigates the matter in the frame of reference of the South African equity market for the eleven-year period ended 30 June 2014.Design/methodology/approach: The paper applies the positive economics methodology of capital markets research in accounting. The relationship between a composite set of accounting ratios with subsequent equity returns is examined in various frames of reference. Findings: Statistically significant correlations are found between accounting ratios and subsequent equity returns. The observed relationships are most pronounced when the selected ratio set is applied to portfolios of shares that have neither value nor growth characteristics, and that are mid-sized in terms of market capitalisation. These findings are in support of the conjecture that a contextual partition of the equity market enhances an investment strategy based on fundamental analysis.Originality/value: There are significant differences in accounting standards, securities regulations and market microstructure between the US and other countries. This paper contributes to the capital markets literature by examining the efficacy of a US-developed fundamental analysis model in the South African equity market, in both context-specific and entire-market frames of reference.

Is the software industry environmentally benign?

A recent Wall Street Journal article by reporter Mike Ramsey characterized the electric car manufacturer Tesla as both a software company and a carmaker. Tesla will soon start to deliver wirelessly to its Model S cars a software upgrade to enable its autonomous driving on the highways. In addition, these cars will be smart enough to figure out at what point it needs to be recharged at the nearest charging station. Google’s electric car is already autonomous. It has not been sold commercially yet, but has been extensively road-tested in the United States without an incident. Google car was designed to have no steering wheel, although California regulations may force the company to introduce one for safety concerns. Airplanes have for some time been equipped with sophisticated software to cruise and land completely and safely on their own. Most product manufacturers have been increasingly dependent on powerful software to make the products easier to use, thereby increasing comfort and making user experience more versatile. The Federal Aviation Administration in the U.S. has just permitted Amazon to test small drones in real world situations of package delivery, though for now, the issued permit is limited in scope. It is, however, a good start, and many other companies are anxious to create a new market for package delivery directly to the consumers. Softwares can do amazing things these days that were not imaginable a decade or two ago. Two of the drivers for technology innovation are new business opportunity and profit potential. The company Apple computers has created a market for a new product again and again. Thanks to its rapid growth resulting from these innovations, it has just become a member of the Dow Jones Industrial Average Index, replacing AT&T. Apple has also attained the status of the largest company in the world in terms of market capitalization. Its nearest rival is the oil giant, ExxonMobil, which is almost 50 % smaller. Most product-manufacturing companies, although they are heavy users of efficiency–enhancing software, are not themselves in the business of selling software. But more and more the software companies have been making inroads into selling hardware where they find business opportunities. For example, even Microsoft manufactures game consoles. Thus, most companies find themselves somewhere in the continuum from purely software to purely hardware, the trend in the United States, being toward software. With all these innovations making life easier, more productive and more comfortable for man, are these businesses inherently cleaner from an environmental point of view? In the last 30 years, an enormous amount of wealth has been created by software companies. The benefits are seen every day and everywhere. We rarely post letters in the physical mail box anymore, the job of the typist has vanished from the office, most mechanical devices have become much safer owing to software, gathering knowledge from a computer terminal has largely replaced visits to the libraries, arguments among friends about the veracity of information can be settled in an instant by asking the computer or the smart phone, and so on. Overall we have been more productive because we are faster in achieving tasks. All of these efficiency–enhancing technologies are known as information technology. What about environmental and societal benefits and harms from information technology? There has been no study yet to capture a Subhas K. Sikdar—Editor-in-Chief.

Investment Returns to Quality in Developed Markets

Quality, defined as companies with high returns on capital, good quality of earnings, and low leverage, has substantial superior investment return predictability. Quality firms as selected by our strategy generate substantially superior returns even though they are significantly larger than the average company in terms of market capitalization. Further, returns from quality are higher than the benchmark even though risk as measured by standard deviations as well maximum drawdowns is lower than the market.

Corporate Governance and Firm Performance: An Exploratory Analysis of Indian Listed Companies

In this article we propose to study whether firm level good corporate governance (CG) leads to better firm performance, leading to higher value creation. Limited evidence exists concerning the impact of CG practices on firm level performance or valuations in the Indian context. This study attempts to fill this gap. Our motivation is to explore the linkage between good CG practices and firm performance in Indian listed companies. We use a panel of 58 top Indian listed companies in terms of market capitalisation (BSE 100 and NSE 100), over the five year period from 2007–08 to 2011–12 for our analysis. Our measurement analysis starts with a broad sample of 37 structural indicators of CG relating to directors, boards committees, audit considerations, ownership and capital structure characteristics and our defined set of control variables. We have used two measures of firm performance, Market to Book Value Ratio (MTBVR) and Return on Asset (RoA). We use principal component analysis to identify the underlying dimensions of CG and determine which indicators are associated with each factor. We conclude that firm performance, measured by RoA, results in R-square of 43.7 per cent, and is significantly influenced by the 7 factors. Firm performance, measured by MTBV Ratio, results in R-square of 34.5 per cent, and is significantly influenced by the 8 factors.

Stock Market Development and Economic Growth: An Evidence from Saarc Countries

The stock market plays a pivotal role in the growth of an economy to a great extent. The study investigates the relationship between stock market development and economic growth in five SAARC countries: Bangladesh, India, Pakistan, Srilanka and Nepal using collected secondary data of 15 years for the period of 1996-2010. The relationship has been measured in terms of market capitalization, total value of stocks traded, stock turnover ratio and volume of the stock market determined through the total number of companies listed in the stock exchange of each country in this region. By using linear-log model, the study has found out that stock market affects economic growth significantly in SAARC countries. In addition, the result of the study by employing the stepwise regression analysis shows that the most representative indicator of capital market that is positively associated to the real economic growth of each country is market capitalization.

Growth opportunities and dividend policy: some evidence on the role of ethnicity in an emerging economy

This paper examines the association between growth opportunities and dividend payouts and moderates the relationship between growth opportunities and dividend payouts. Our sample consisted of the Malaysian top 300 public listed companies (in terms of market capitalization) for a period from 2004 to 2011. Based on a specified selection process, the sample contained 1330 firm-year observations, after excluding firms with missing data. This paper finds that growth opportunities is associated with less dividends payouts and that this relationship is weaker for Bumiputera ethnic controlled firms. Furthermore, the results show that this negative association exists only for non-Government Linked Controlled firms

Accruals, Conservatism and Value Relevance in a Transition Economy

The goal of this paper is to identify firm-level factors that affect the valuation of companies in a transitional economy of Poland in comparison to companies from developed continental markets of Germany and France. The novelty of our approach rests in a careful construction of the comparable sample, which is a challenge given that Polish companies are relatively small in terms of market capitalization. Therefore we limit our sample to companies for which we can find comparable companies in the other two markets and then use sample matching techniques to identify the comparables. We increase comparability by limiting the sample to IFRS reporting companies and studying only the period after the mandatory adoption of IFRS in the European Union. Then, we measure accruals intensity, conditional conservatism, intangibles intensity and control for negative earnings. Results of valuation model estimations show that cross-country differences in valuation can be explained by the level of accruals intensity and conservatism, the interaction between the two variables, and the interaction between conservatism and intensity of intangible assets. The results imply that it is firm-specific choices in accounting practice that affect the value relevance of earnings rather than the broad factors which characterize each country.

The Dynamics Of Stock Market Development In Kenya

This paper highlights the origin of the stock market in Kenya, and traces the reforms that have been undertaken to develop the stock market. It also highlights the growth of the Kenyan stock market, as well as the challenges currently facing the market. The country has one stock market, known as the Nairobi Securities Exchange (formerly the Nairobi Stock Exchange). It is one of Africas largest stock markets. Since the early 1980s, a number of stock market reforms have been implemented in Kenya. These include the formation of a regulatory body (Capital Markets Authority CMA) in 1989, the replacement of the "Call-Over" trading system by the floor-based "Open-Outcry System" in 1991, the reduction of listing costs, the relaxation of the exchange control for locally controlled companies, and the repeal of the Exchange Control Act. Following these reforms, Kenyas stock market has developed significantly in terms of market capitalisation, the total value of stocks traded, and the turnover ratio. Although the stock market in Kenya has developed over the years, like many other developing countries' markets, it still faces a number of wide-ranging challenges.

Stock Market Development In The United Kingdom: Prospects And Challenges

This paper highlights the origin and development of the U.K. stockmarket. The country consists of one major stock market, known as the London Stock Exchange, which is one of the worlds largest stock markets. Stock market reforms have been implemented since the Big Bang of 1986 and the Exchange responded positively to most of these reforms, but not so positively to others. As a result of the reforms, the U.K.s stock market has developed, in terms of market capitalisation, the total value of stocks traded and the turnover ratio.Although the U.K. stock market has developed over the years, it still faceswide-ranging challenges, such as the uncertainties that come with new regulation and regulatory changes dominating at both domestic and international levels and the sovereign debt crisis that has left the U.K. stock market volatile.

The Brazilian stock market development: A critical analysis of progress and prospects during the past 50 years

This paper highlights the origin of the stock market in Brazil, and traces the reforms that have been undertaken to develop the stock market. It also highlights the growth of the Brazilian stock market, as well as the challenges currently facing the market. The country has one big stock market, known as the BM&FBOVESPA, which is one of the world’s largest stock markets. Over the years, a number of stock market reforms have been implemented in Brazil. Among these reforms have been the restructuring of the financial market, the replacement of the traditional trading systems by full electronic trading systems, the enactment of new laws governing the stock market, as well as the revision of the existing laws. In addition, the formation of a regulatory body known as Securities and Exchange Commission (CVM) in 1976 also assisted in the creation of an environment conducive for the growth and development of the stock market. Since the implementation of these reforms, the Brazilian stock market has developed significantly in terms of market capitalisation, the total value of stocks traded, and the turnover ratio.

The dynamics of stock market development in the United States of America

This paper highlights the origin and development of the stock market in the United States of America. The country consists of several stock exchanges, with the three largest being the NYSE Euronext (NYX), National Association of Securities Dealers Automated Quotation (NASDAQ), and the Chicago Stock Exchange. Stock market reforms have been implemented since the stock market crash of 1929; and the exchanges responded positively to some of these reforms, but not so positively to some of the reforms. As a result of the reforms, the U.S. stock market has developed in terms of market capitalisation, the total value of stocks traded, and the turnover ratio. Although the U.S. stock market has developed over the years, its market still faces wide-ranging challenges.

Buying High Return Low Volatility Technology Stocks

ABSTRACT. Technology stocks provide higher returns but can be associated with high levels of volatility. This occurs are technologies go in and out of fashion, which impacts future profits and stock prices. This paper introduces the concept of Risk Weighted Alpha, which identifies stocks that have outperformed over a long period of time and there is usually a tendency for such stocks to keep growing further. When this trend breaks then this method also advises to keep reducing the weight of these stocks within the portfolio. As an example, the NASDAQ 100 index stocks are analysed to understand how the Risk Weighted Alpha method can be applied. Results show that the Risk Weighted Alpha portfolio delivered three times higher return than the NASDAQ 100 index with the same level of systematic risk.JEL Codes: R53; H54Keywords: indexation; portfolio theory; portfolio construction; stock selection; fundamental indexation and alpha1. IntroductionTechnology companies like Apple, Intel, Google and IBM for example have had exponential growth in stock prices over the years. However, there are numerous companies that have fallen over, especially during the dotcom bubble in 2001-02. So, how do you pick companies that will grow overtime? This paper takes the example of the NASDAQ 100 index to analyze companies that have grown and are expected to keep growing over time compared to those that have not performed. Before we move is discussion further, we need to realize that the NASDAQ 100 is a market capitalization based index. This means that the stocks that form the NASDAQ 100 index are the biggest companies in terms of market capitalization or value that are listed on this index. NASDAQ is primarily an index that lists technology related companies in the United States. Most major indexes like the Dow Jones Industrial Average, SP 2008; 2010) have provided the fundamental indexation method that utilizes five fundamental factors: revenue, sales, cash flow, employment and book value, in order to develop the index weighting of stocks. They argue that the fundamental index is a more efficient indexation method compared to the market capitalization weighted index method. Researchers (Kaplan 2008, Hemminki et al. 2008, Hsu et al. 2006, Blitz et al. 2008, Estrada 2006, Chen et al. 2007, Siegel 2006, Mar et al. 2007, Mar et al. 2009, Blitz et al. 2010 and Basu and Forbes 2013) argue that the evidence is inconclusive if the fundamental index method is actually more efficient than the market capitalization method and if it then this is mainly due to the value and small cap bias in the fundamental index method.An alternative to the market cap and fundamental indexation methods are the equal weighted and risk weighted indexes. Equal weighted indexes as suspected weight each stock with equal weight in the index and are seen to be profit taking indexes because over time they reduce the weight of the stocks that have increased in value and increase the weight of stocks that have decreased in value (Bemartzi and Thaler 2001, Winde liff and Boyle 2004 and DeMiguel et al, 2007). As a result, these indexes are seen to have a high tracking error to market cap based indexes and require frequent index rebalancing. There are a variety of risk weighted index methods that have been developed, which are the minimum variance (MV), equally weighted portfolio, maximum Sharpe ratio (MSR), most diversified portfolio (MDP), equally-weighted risk distribution (ERC) portfolio and semi-variance portfolio (Demey et al. 2010).While, risk weighted methods reduce risk through diversification, they also reduce the overall return. …

한국주요상장사 주가 실현변동성 추정시 시장미시구조 잡음과 최적 추출 빈도수

본 논문에서는 KOSPI 시가총액기준 상위 4종목(삼성전자, 현대차, 현대모비스, POSCO)의 고빈도 거래 데이터를 바탕으로 일중 수익률의 실현변동성과 시장미시구조잡음에 대해 연구한다. Volatility signature plot을 통해 실현변동성(Realized Variance; RV)과 편의수정 실현변동성(<TEX>$RV_{AC_1}$</TEX>)의 편의를 확인하고 시장미시구조 잡음의 특징을 실증적으로 파악한다. 또한, 잡음 대 신호비(Noise-to-Signal Ratio; NSR)를 사용하여, 평균제곱오차(Mean Square Error; MSE) 기준의 실현변동성(RV)과 편의수정 실현변동성(<TEX>$RV_{AC_1}$</TEX>)의 최적 추출 빈도수를 추정해본다. We have studied the realized variance(RV) of intra-day returns and market microstructure noise based on high-frequency stock transaction data for the four largest companies in terms of market capitalization in the KOSPI. First, non-negligible biases are observed for the RV and for the bias-corrected realized variance(<TEX>$RV_{AC_1}$</TEX>) which is constructed by adjusting RV for the first order autocorrelation in intra-day returns. Bias is more obvious for the RV and the <TEX>$RV_{AC_1}$</TEX> when intra-day returns are sampled more frequently than every 2 minutes. Transaction Time Sampling(TTS) is shown to be better than Calendar Time Sampling(CTS) in terms of biases of the RV and the <TEX>$RV_{AC_1}$</TEX> for the 4 companies. The analysis reveals that market microstructure noise is temporally dependent. Second, by using the Noise-to-Signal Ratio(NSR), we estimate sampling frequencies that are optimal in terms of the Mean Square Errors(MSE) of the RV and the <TEX>$RV_{AC_1}$</TEX>. The optimal sampling frequencies are around 200 for RV and is around 5000 for the <TEX>$RV_{AC_1}$</TEX> for all the four stock prices. For the 6 hour transaction period of the Korean stock trading, these correspond to about 2 minutes and 6 seconds.

The price discovery process and volatility linkages in a resource-based emerging market: evidence from the Saudi Stock Market

With the opening up of the Saudi Stock Market to foreign participation, international interest in this important oil dominated economy has intensified. This paper examines the interrelationships between the 12 sector indices in the Saudi Arabian Equity market - the largest equity market in the region in terms of market capitalisation. The vector error correction model shows that the petrochemical sector had the largest short run speed of adjustment followed by agriculture and building. This is consistent with the observation that many international investors use the Saudi petrochemical sector to achieve oil factor exposure. The study also investigates the cross sectional structure of innovations or volatility across the sectors using a low order GARCH representation. The contemporaneous correlation in standardised innovations across the sectors is relatively high, while lagged innovations in the banking and industrial sectors showed the largest impact on future volatility of the other sectors.