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Finance and Financial Management Commons™

Open Access. Powered by Scholars. Published by Universities.®

Edith Cowan University

Series

2021

Articles 1 - 8 of 8

Full-Text Articles in Finance and Financial Management

Impacts Of Combined Assurance On Integrated, Sustainability And Financial Reporting Qualities: Evidence From Listed Companies In South Africa, Augustine Donkor, Hadrian Geri Djajadikerta, Saiyidi Mat Roni Apr 2021

Impacts Of Combined Assurance On Integrated, Sustainability And Financial Reporting Qualities: Evidence From Listed Companies In South Africa, Augustine Donkor, Hadrian Geri Djajadikerta, Saiyidi Mat Roni

Research outputs 2014 to 2021

This study assesses the impacts of combined assurance (CA) quality on external reporting qualities (i.e., integrated, sustainability and financial reports). Data from listed firms on the Johannesburg Stock Exchange (JSE) in South Africa are used in this study. JSE is the largest stock exchange in Africa and, currently, the only capital market that mandates integrated reporting (IR) practice. This study uses content analysis to produce IR and CA quality data from IR reports and collects financial and sustainability quality data from the Bloomberg database. Ordinary least square (OLS) regression is used to test the models, together with a set of …

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Financial News And Cds Spreads, Paresh Kumar Narayan, Deepa Bannigidadmath Mar 2021

Financial News And Cds Spreads, Paresh Kumar Narayan, Deepa Bannigidadmath

Research outputs 2014 to 2021

© 2020 Elsevier B.V. This paper examines whether financial news moves CDS spreads for a large number of U.S. stocks sorted into 19 panels consisting of sectors, sizes and credit quality. Using a unique financial news data set, we discover that while both positive and negative news predicts CDS spread changes in most of the panels, annualised mean–variance profits and utility gains are dominated by forecasting models that use positive news as a predictor. At best, risk factors only account for around 31% of observed profits.

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Uncovering Real Earnings Management: Pay Attention To Risk-Taking Behavior, Samar Alharbi, Md Al Mamun, Nader Atawnah Jan 2021

Uncovering Real Earnings Management: Pay Attention To Risk-Taking Behavior, Samar Alharbi, Md Al Mamun, Nader Atawnah

Research outputs 2014 to 2021

We examine the impact of corporate risk-taking on firm-level real earnings management. We find that firms with higher risk-taking engage in higher real earnings management. Our results are robust to a series of robustness tests, including simultaneous least squares approach, firm fixed effect, change analysis, and pseudo difference-in-difference analysis. Additional analyses reveal that the impact of risk-taking on real earnings management is more pronounced among firms that experience prior-year loss and are run by top-echelons who are risk lovers. Sarbanes-Oxley Act (SOX) regulation does not attenuate the positive effect of risk-taking on real earnings management. However, external monitoring by institutional …

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Trading Macro-Cycles Of Foreign Exchange Markets Using Hybrid Models, Joseph Z. B. Ling, Albert K. Tsui, Zhaoyong Zhang Prof Jan 2021

Trading Macro-Cycles Of Foreign Exchange Markets Using Hybrid Models, Joseph Z. B. Ling, Albert K. Tsui, Zhaoyong Zhang Prof

Research outputs 2014 to 2021

Most existing studies on forecasting exchange rates focus on predicting next-period returns. In contrast, this study takes the novel approach of forecasting and trading the longer-term trends (macro-cycles) of exchange rates. It proposes a unique hybrid forecast model consisting of linear regression, multilayer neural network, and combination models embedded with technical trading rules and economic fundamentals to predict the macro-cycles of the selected currencies and investigate the predicative power and market timing ability of the model. The results confirm that the combination model has a significant predictive power and market timing ability, and outperforms the benchmark models in terms of …

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Does Corporate Eco-Innovation Affect Stock Price Crash Risk?, Rashid Zaman, Nader Atawnah, Muhammad Haseeb, Muhammad Nadeem, Saadia Irfan Jan 2021

Does Corporate Eco-Innovation Affect Stock Price Crash Risk?, Rashid Zaman, Nader Atawnah, Muhammad Haseeb, Muhammad Nadeem, Saadia Irfan

Research outputs 2014 to 2021

We examine the effect of corporate environmental innovation (hereafter eco-innovation) on stock price crash risk and document a significant negative association. Utilising a large sample of publicly listed U.S. firms for the period 2003 to 2017, we find that an increase in eco-innovation from the 25th to the 75th percentile is associated with 17.62% reduction in stock price crash risk. This outcome remains robust to a variety of sensitivity tests and after accounting for potential endogeneity concerns. Eco-innovative firms attract more institutional investors and equity analyst following and disclose more information leading to lower stock price crash risk. Additional tests …

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Short-Term Capital Flows, Exchange Are Expectation And Currency Internationalization: Evidence From China, Mingming Li, Fengming Qin, Zhaoyong Zhang Jan 2021

Short-Term Capital Flows, Exchange Are Expectation And Currency Internationalization: Evidence From China, Mingming Li, Fengming Qin, Zhaoyong Zhang

Research outputs 2014 to 2021

This paper intended to employ a portfolio approach to assess the effect of exchange rate expectation on Chinese RMB internationalization and empirically test the interactive effects among short-term capital flows, RMB appreciation expectation and the internationalization process using a VAR model with monthly data ranging from February 2004 to December 2020. The results suggest that RMB exchange rate appreciation could lead to an increase in the foreign demand for RMB and RMB denominated assets, while RMB internationalization would attract more short-term capital inflow due to the reduced transaction costs. The empirical evidence from the VAR model estimation confirms the finding …

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Impact Of Covid-19 On Cryptocurrencies: Evidence On Information Transmission Through Economic And Financial Market Sentiments, Irfan Haider Shakri, Jaime Yong, Erwei Xiang Jan 2021

Impact Of Covid-19 On Cryptocurrencies: Evidence On Information Transmission Through Economic And Financial Market Sentiments, Irfan Haider Shakri, Jaime Yong, Erwei Xiang

Research outputs 2014 to 2021

This paper investigates the relationship between the COVID-19 crisis and the two leading cryptocurrencies, Bitcoin and Ethereum, from 31 December 2019 to 18 August 2020. We also use an economic news sentiment index and financial market sentiment index to explore the possible mechanisms through which COVID-19 impacts cryptocurrency. We employ a VAR Granger Causality framework and Wavelet Coherence Analysis and find the cryptocurrency market was impacted in the early phase of the sample period through economic news and financial market sentiments, but this effect diminished after June 2020.

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Non-Traditional Systemic Risk Contagion Within The Chinese Banking Industry, Tonmoy Choudhury, Simone Scagnelli, Jaime L.P. Yong, Zhaoyong Zhang Prof Jan 2021

Non-Traditional Systemic Risk Contagion Within The Chinese Banking Industry, Tonmoy Choudhury, Simone Scagnelli, Jaime L.P. Yong, Zhaoyong Zhang Prof

Research outputs 2014 to 2021

Systemic risk contagion is a key issue in the banking sector in maintaining financial system stability. This study is among the first few to use three different distance-to-risk measures to empirically assess the domestic interbank linkages and systemic contagion risk of the Chinese banking industry, by using bivariate dynamic conditional correlation GARCH model on data collected from eight prominent Chinese banks for the period 2006–2018. The results show a relatively high correlation among almost all the banks, suggesting an interconnectedness among the banks. We found evidence that the banking system is exposed to significant domestic contagion risks arising from systemic …

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