Abstract
This paper investigates the impacts of index additions on the return and liquidity of Shariah-compliant shares in Kuwait, Oman, Qatar, and UAE. The author uses the sample of companies added to the Dow Jones Islamic Market index over the period of January 2008-December 2009. The findings show that stock prices respond positively to index addition events. However, evidence in support of the changes in the liquidity of added shares is mixed, depending on the country and the liquidity measures. These findings have important implications for Shariah-complaint investors, showing that companies whose activities reflect the beliefs and ethos of their investors in the Middle East may also be attractive from an investment point of view.
| Original language | English |
|---|---|
| Pages (from-to) | 53-62 |
| Number of pages | 10 |
| Journal | Investment Management and Financial Innovations |
| Volume | 8 |
| Issue number | 1 |
| Publication status | Published - 2011 |
Keywords
- Abnormal returns
- Event study
- Index addition
- Liquidity effects
- Shariah-compliant investment