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Examining the Performance of Islamic and Conventional Stock Indices: A Comparative Analysis

Asutay, M.; Wang, Y.; Alija, A.

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Authors

Y. Wang

A. Alija



Abstract

Islamic indices encompass different fundamental principles to those held by conventional ones, which directs attention onto comparative financial performance. This paper offers a comprehensive performance comparison between Islamic indices and conventional indices, based on four main markets: worldwide, the US, Europe, and Asia-Pacific for the period of 2007 and 2017 through financial ratio comparison and also the CAPM-EGARCH model. The main finding shows that Islamic indices yield higher average returns and lower risks during the 2007-2009 and 2013-2017 periods for all four markets, compared with respective conventional markets. During 2009-2013 period, the comparison proves inconclusive, since Islamic indices demonstrate better performance in European and Asia-Pacific markets, while conventional indices operate at an enhanced level within other markets. Overall, Islamic indices outperformed conventional indices during the global financial crisis period (2007-2009) and the latter post-crisis phase (2013-2017), especially in the European and Asia-Pacific markets.

Citation

Asutay, M., Wang, Y., & Alija, A. (2022). Examining the Performance of Islamic and Conventional Stock Indices: A Comparative Analysis. Asia-Pacific Financial Markets, 29(2), 327-355. https://doi.org/10.1007/s10690-021-09351-7

Journal Article Type Article
Acceptance Date Sep 7, 2021
Online Publication Date Sep 24, 2021
Publication Date 2022-06
Deposit Date Sep 8, 2021
Publicly Available Date Oct 12, 2021
Journal Asia-Pacific Financial Markets
Print ISSN 1387-2834
Electronic ISSN 1573-6946
Publisher Springer
Peer Reviewed Peer Reviewed
Volume 29
Issue 2
Pages 327-355
DOI https://doi.org/10.1007/s10690-021-09351-7
Public URL https://durham-repository.worktribe.com/output/1242021

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Publisher Licence URL
http://creativecommons.org/licenses/by/4.0/

Copyright Statement
Open Access This article is licensed under a Creative Commons Attribution 4.0 International License, which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence, and indicate if changes were made. The images or other third party material in this article are included in the article's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the article's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder. To view a copy of this licence, visit http://creativecommons.org/licenses/by/4.0/.





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