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Stock performance under alternative Shariah screening methods: Evidence from Australia

journal contribution
posted on 2021-01-04, 05:49 authored by Ali El Saleh, Doureige JurdiDoureige Jurdi
© 2020 Accounting and Finance Association of Australia and New Zealand
This paper examines the effect of Shariah screening on performance. We use the constituents of the ASX200 to identify Shariah-compliant investments (SCI) using eight different Shariah screening methods (SSMs) and investigate the effect of quantitative screening ratios and purification ratios on performance. We find significant differences in the constituents of the SCI universe and performance across SSMs. Our results demonstrate consistent evidence that the debt and purification ratios are negatively associated with SCI performance. However, we find mixed results for the impact of liquidity ratios on performance.

History

Publication Date

2020-12-05

Journal

Accounting and Finance

Article Number

acfi.12735

Pagination

50p.

Publisher

WILEY

ISSN

0810-5391

Rights Statement

The Author reserves all moral rights over the deposited text and must be credited if any re-use occurs. Documents deposited in OPAL are the Open Access versions of outputs published elsewhere. Changes resulting from the publishing process may therefore not be reflected in this document. The final published version may be obtained via the publisher’s DOI. Please note that additional copyright and access restrictions may apply to the published version.

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    Keywords

    Social SciencesBusiness, FinanceBusiness & EconomicsEthical financeShariah screeningIslamic financeStock performanceWORKING CAPITAL MANAGEMENTCOMPLIANTINDEXESFINANCESININDEPENDENCEINVESTMENTSLEVERAGETESTSFAITHAccounting

    Licence

    CC BY 4.0

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