• Liquidity Effect and Asset Pricing Tests in Karachi Stock Exchange 

    FARHAN AHMED    Muhammad Kashif
    07 Jul 2018

    Individual or institutional investors are always interested in devising the profitable portfolios to maximize the wealth. In the highly volatile market like Pakistan, liquidity needs to be considered as a crucial factor to price the returns. This study aims to test the basic liquidity measures known as a turnover ratio and trading volume. Using daily data from all shares listed on Karachi Stock Exchange over the period January 2005 – December 2015, equally weighted and value weighted decile portfolios are constructed. We found that the investors should take a short position in P10 with low turnover ratio and take a long position in P1 with the high turnover ratio. On the basis of trading volume, investors should take a long position in P10 with high trading volume and take a short position in P1 with low trading volume. The study is resulted in contradiction with mean-variance framework because the said portfolios fail to generate abnormal returns constructed on the basis of turnover ratio and trading volume. The results of the study are beneficial for brokerage houses in explaining the variations on portfolio performance in times and the investors to devise the optimal investment strategies in their portfolio choice decisions either investment portfolio based on liquidity turnover ratio or trading volume yields higher or lower returns.
  • Earnings Management and Dividend Policy: Empirical Evidence from Major Sectors of Pakistan  

    FARHAN AHMED    Neha Advani, Muhammad Kashif
    17 Jul 2017

    This paper means to inspect the regression between Price earning (P/E) ratio as a proxy of earning management and payout proportion that is dividend policy. This paper utilises multivariate analysis to examine the relationship between price-earnings ratio and dividend policy. Using 10 years annual data from 2006-2016, this paper delivers new confirmation demonstrating that when the return on equity is more prominent than the required rate of return, the P/E ratio and dividend payout ratio shows a negative relationship and positive convexity or vice versa.
  • Dynamic Relationship between Gold Prices, Oil Prices, Exchange Rate and Stock Returns: Empirical Evidence from Pakistan

    FARHAN AHMED    Muhammad Kashif, Farjad Feroz
    17 Jul 2017

    This study aims to analyze the dynamic relationship between key macroeconomic indicators of Pakistan including gold prices, stock market returns, and exchange rate and oil prices. Significant variations or shocks have been observed over time especially in the past decade among the stated macroeconomic variables. It is essential to validate the relationship between them periodically and this study will help investors who want to diversify their investment into various assets classes including financial assets and real assets.
  • Oil Price Shocks on the Industry Level Production Using Vector Auto Regression: Empirical Evidence from Pakistan

    FARHAN AHMED    Osama Daudpota, Muhammad Kashif
    31 May 2017

    Industrial production is one of the leading indicators of gross domestic product and economic growth of the country which reflects the overall economic performance of a country. In other words decreases or increases in industrial production point out a contracting or expanding economy. Therefore, changes in prices of oil are the crucial inputs to the overall industrial production. This study examines the effects of oil prices shocks on the industrial production in Pakistan during the period July 2000-June 2015 by using VAR model. This research has shown that oil price shocks had a negative impact on industrial production in Pakistan to some extent. It is recommended to forecast oil prices for future that can help take precautionary steps to be flexible enough to control the impact on industrial production level. 
  • Financial Literacy among University Students

    FARHAN AHMED    Syed Muhammad Ahsan Hussain
    22 Feb 2017

    Financial Literacy plays very vital role in the development and resource management of any economy. The focal point of the study is to extent the financial management practices with in the university students on the basis of their socio-demographic factors. Financial management practices or financial knowledge has impact on consumer policy that contributes to economic development based on family, peer and demographic factors. The term financial literacy is under practices or financial knowledge has impact on consumer policy that contributes to economic development on the basis of socio-demographic factors. The term financial literacy is under discussion by not only the financial institutions and professional bodies but also by student communities in order to have the sense of saving for better future. The financial knowledge gives insights to common people to save and make rational financial decisions in communities at large. Most of the researches have been undertaken on the usage of credit cards by students but no measures by authorities have been taken in order to promote this idea in case of Pakistan. In this study, the practical issues are the university students are not that much aware about the importance and pros-cons of savings, investments and other financial products like interest, risk, inflation etc. This research will provide insights by extending the impact of socio-demographics on the financial management practices by university students.
  • Measuring Service Quality and Patients Satisfaction: A Case of Agha Khan Hospital, Karachi

    FARHAN AHMED    Dr. Muhammad Zaki Rashidi
    22 Feb 2017

    Service quality in health care industry in Pakistan has become a big issue; there are lots of problems being faced by patients. But some patients on the other hand are satisfied with the services which they get from hospitals which may depend on socio-demographic factor of the patients. According to Andaleeb, (2001) the health care sector has a rapid growth in service economy. Padma et al., (2010) stated in developing countries heath care system is dependent on efficiency of management to increase and enhance the effectiveness of health care system, because of the fact that resources are not available according to the demand in service of healthcare institutions.
  • Exchange Rate Pass-Through To Domestic Prices: Evidence from Pakistan

    FARHAN AHMED    Syed Muhammad Ahsan Hussain
    21 Feb 2017

    Exchange Rate - Pass Through is the phenomena that explains to what extent the movements in exchange rate affect macroeconomic variables of any country. This paper analyses the movements of exchange rate that has affected on wholesale price index, consumer price index, large scale manufacturing, fuel and lightening and the growth of money supply. The data from June 2005 to June 2011 is analyzed by using the econometric framework. In this study, the results of impulse response have shown that impact of exchange rate pass through is high on WPI and low on CPI. The results of variance decomposition is as much as the 5.48%. For the WPI, the variance decomposition is as much as 10.15% and the other variations are explained by the other independents variables.