Natural Disasters and the Philippine Stock Exchange Index: A Garch-M Analysis by Adrian L. Gallido, Ph. D. and Martites A. Khanser, D. B. A
This analyze examines the effect of earthquakes, tropical cyclones and scenic eruptions on the Philippine Stock market index (PSEi) over the amount of 2 January 1985 to 30 Dec 2010. Inside the context from the Philippine Marketplace, the amalgamated index is visible to support the “gaining from loss speculation of Shelor et al. (1990), exactly where it was implied that inventory prices will be positively inspired by problems.
The losses derived from catastrophes contribute to increases in some business sector.
As an example, the 1989 California earthquake can be viewed as negative to real estate property firms (Property index) however in contrast, beneficial on the share price of insurance firms. The adverse response of the stock prices on real estate firms was regarded as signal of the bad location of the houses. In contrast, the positive market response on the share price of insurance organizations was deemed likely due to investor targets of higher with regard to property-liability insurance-related products.
We have also learned that there are standards of incidents to be regarded as a disaster, In respect to Urgent Events Databases (EM-DAT), a meeting is considered a disaster when it complies with at least one of the ff. criteria: i) 10 or even more people are slain; ii) 100 or more individuals are affected; iii) a state of emergency is definitely declared; iv) a require international assistance was made.
A good point within this study that I’ve likewise learned is usually that the future work can also consider other occasions including technological disasters along with disasters of human origins such as terrorism (man-made disaster).
In my individual opinion, as investors sell shares with the slightest touch of anything that might effects stocks in a negative way, and that promotes the currency markets down. The reverse is likewise true” the good news is, the demand for stocks can be higher and it motivates shareholders to obtain. And as to get the effect of natural devastation on the stock market, specifically, I do believe investors dread, at least in part, that when our region broadcasts or perhaps announces a few disaster, it will contribute huge sums of money and personnel to devastation aid, and it spots a strain about our economic system.
Overall, Problems have an minor effect on marketplace returns and investors may consider which includes market actions in measuring the impact of natural catastrophes, and can produce disaster-based approaches.
This is a unique study for those who wanted to commit or other stakeholders such as investors to know the degree disasters that can affect marketplace performance for us to make appropriate steps to better manage each of our portfolio and also to be guaranteed if the companies are doing good, resistant or strong.
Alissa D. Munez
Dr . Trinidad
MBA- Colegio sobre San Juan de Letran
Profile Management
Response Paper
The Study of Marriage between Hard anodized cookware Stock Exchanges and Nyse by Neda Bashiri, Amir Mohammad Zadeh
This analyze investigates the linkages between equity marketplaces of a few Asian countries, which includes Malaysia, Indonesia, Philippines, The japanese and Turkey and those in USA using correlation analysis and Vector Auto Regressive (VAR). Study regarding relationship between ASE and NYE gives knowledge of the degrees of romance and co-movement among worldwide financial markets that can help both equally individual and company investors to handle their portfolios for increasing their risk and returning trade-off. Also, co-movements between two countries can affect the pattern of the economy.
It was learned that time series will be correlated and correlation between markets is positive, which will tends to suggest that there is common trend/factor that may be driving the markets in the same direction. Based on the result in among this research, the US was found to be the most exogenous. These results are achieved intended for Asian Markets, USA and Philippines influence Malaysia. USA as well influences Poultry. The Philippines are affected by Malaysia, Indonesia, and USA whilst Indonesia can be affected by Malaysia and the Philippines, while Asia is afflicted with Malaysia plus the USA. This study may help investors to look out for the movements or within different economical markets around Asia.
It was learned that there is absolutely no stock exchange that can affect the UNITED STATES stock exchange although actually NEW YORK STOCK EXCHANGE influences almost all developed markets. The explanation for the US is the fact that it must be the largest and a lot dominant industry in the world. One of the ideas for this kind of study stems from the fact that globalization is a crucial trend. Considerable involvement of globalization to get the financial markets comes form the Modern day Portfolio Theory, which allowed all international investors to diversify globally in order to reduce their portfolio’s risk level to a level lower than their house country’s organized risk level.
In this examine, Mentalities triggers a great aspect on the a result of the activity of the stock exchange, it was seen as a a lack of identity, causing people to think and act like the general/major populace in the world. For this reason mentality, buyers become very sensitive regarding on the news of financial problems in USA and they quickly pull out by financial marketplaces. However , this does not necessarily mean innovations in other marketplaces should be entirely ignored. Even though, this is a fantastic study that people learned the partnership between ASE and NYSE. And found that the USA returns is a major market that influences the majority of markets. Alissa L. Munez
Have Filipino People Become Less Prudent? Simply by Akiko Terada-Hagiwara
It’s a fascinating study to be aware of why the regular household keeping rate inside the Philippines decreased by five. 2 percentage points to about a mere 5 percent disposable income from 1996-2006. By presenting the article depending on Surveys, Decomposition Analysis and Estimations it shows the declining financial savings rate have been due to the decreased precautionary purposes as partially expected by development including the expansion of social security alarm. I agree the slow shifting income development is amplified by even more extensive protection of the system to the informal sector employees, which seems to have decreased households’ precautionary savings.
In respect to this content, a number of elements are relevant in impacting the precautionary motive with the Filipino households. First, the Philippines’ Social Security System designed significantly during the 1990’s. Existing studies located that the coverage by cultural programs, including disability insurance, unemployment insurance and medical health insurance is in a negative way associated with personal savings. In 1988, simply less than half of the Filipino personnel were have the system. The machine now addresses 3 from every 4 staff (75%). This kind of expanded insurance coverage of the SSS implies a reduce need for the younger cohorts to accumulate precautionary savings.
I agree with the copy writer that the market factors will not fully clarify the declining timesaving level profile because it was more associated with the changing precautionary motives of Filipino households. The precautionary saving was good in nineties when the coverage of SSS is still limited. However , the precautionary motive does not appear to be present in the 2000s. The less wise behaviors are normally found to be significant with homes with informal sector jobs, but just in the 2000s validating the extended SSS being the major factor influencing the Filipino households’ cost savings behavior. Moreover, this impact is found especially strong with lower income people in 2000s.
Just to put another reason how come Filipino households’ savings prices declined can be our poor spending behaviors; we wanted to have latest devices and anything that is trending. As for the OFW’s, after they go home to get vacation, that they spend like a one day uniform and get back to abroad to earn money and to duplicate the cycle. Also, having less Financial Know-how, we know that Financing is a very challenging subject. I really believe that we should start to invest in the knowledge. Of course, if you ask the majority of Filipinos about where their very own savings happen to be, most of them will say that they retain their money in the Bank. Just few of all of us know about assets on stocks or mutual funds. Alissa L. Munez
Reaction Paper
Dynamic Correlation between inventory prices and exchange rates by Chin-Hao Lee, Shuh-Chyi Doong and Pei-J Chou
This article is interesting because it evaluated the discussion between inventory price and exchange rate and explored their energetic correlation motivated by the wall street game volatility. The correlation between stock market and foreign exchange market is affected by the stock market movements. The correlations become higher in Asian appearing countries apart from in the Thailand when their particular stock market can be volatile. Certainly with the copy writers that this research is particularly necessary for international shareholders and managers in diversifying their techniques for improving their investment efficiency because the correlations between stocks and options and forex trading markets become higher while the stock market volatility boosts in Dalam negri, Korea, Malaysia, Thailand and Taiwan, although not in the Philippines.
Moreover, depending on the conclusions of this article, shareholders can hedge risk among stock and foreign exchange market segments domestically when the domestic currency markets is secure. Otherwise, once stock market turns into volatile, buyers diversify their portfolios intentionally for hedging risk since the correlation among stock and foreign exchange prices becomes bigger.
So it was learned that an international company would certainly be directly affected by currency fluctuations. They will try to reduce this using a hedge pay for, so any kind of losses they get on one-currency balances with gains on another.
Perhaps the stock price of the company is based on perceived value, not necessarily for the predicted value of their assets and relationships. However , since currency exchange costs are merely signs of the standard state of the economy, a problem that would influence a product based company, may well or may not show up being a fluctuation inside the currency exchange. A financial services business is seriously influenced by exchange rates, but still, the perception of their value, would not immediately always be affected.
1 . Lean Department Banking
Practice: We are today implementing Lean Branch Financial, where we eliminate “deposit slip, disengagement slips and bills repayment slips for Over-the-counter deals (cash and check deposit/bills payment, withdrawals).
For Deposit- Each deposit or expenses payment should be supported by a duly validated slip or transaction invoice. The customer, payor or agent shall what is completeness and accuracy of the deposit or perhaps bills paymentaccepted via the issuance of purchase receipt simply by signing on the transaction receipt.
For Withdrawal- a duly validated Withdrawal/Debit slip or perhaps transaction invoice shall support each disengagement. The control teller shall ensure the completeness and accuracy from the posted revulsion. Any modification on the withdrawal/Debit slip will probably be signed TOTAL by the consumer.
This was executed to improve consumer experience upon making pay in, bills repayment or revulsion by moving to a paperless process.
Suggestion: The Trim Branch Version that was implemented inside our company was great nevertheless unlike various other Banking institutions that offer this kind of services, they use an even more systematic and enhance technology. Where consumers can be even more responsible on doing their particular banking orders. I’ve noticed that the implementation of the industry’s Lean Department Banking genuinely improves consumer experience since clients merely wait their particular numbers being called and just dictate their very own account figures and quantity they need to put in or to take away. The only thing that they may do is always to wait and confirm all their transaction ahead of they indication the fall.
But there are numerous instances of misposted transactions or wrong ventures that was overlooked by teller and was signed by the client. The client would not check his or her transaction and just sign the slip. If perhaps not properly handled, this kind of error may result to monetary and reputational risk of your bank. So I suggest that, since we are going to implementing a Lean Part Model we should update more on the system and provide queuing machines to the branches.
Exactly where their clientele could revise their own passbooks, check their account balances, etc . in the bank that could give understanding on their consumers and let all of them feel the Real Banking Experience. The bank should never limit technology just by providing an online financial transaction outside its divisions but must provide online banking purchase inside the limbs. Since our company is now in the present00 era, wherever technology is somewhat more advance. We need to help one another to be familiarized on how to utilized this technology for faster, impressive and superb banking knowledge.
2 . Rare metal Members OR Senior Citizens, PWD’s and Frequent Clients
Practice: Gold Members are clientele with VIP treatment who also maintains their very own PHP100, 500 Average Daily Balance in the bank. They are given a priority queuing the same as the senior citizens and PWD’s. There are occasions that the clients with top priority queuing receive inside the traditional bank all at once. Because they know that they must be prioritized, they will don’t get amounts for queuing and just proceed directly to the counter for his or her transaction.
Suggestion: Sometimes it just happened that your clients with top priority queuing gets inside the bank all at once and will also be disappointed should you will tell them to just wait for their switch because you will find a client together with the same standard of priority that transacts first. This kind of scenarios must be opened up to conferences or huddles on the Top quality Circle to mitigate the challenge and to take care of the quality service the company desires to implement. There should be a certain person/employee to collect as well as to receive their very own transactions in order that the process will probably be discreet simply by delivering the transaction for the processing teller and it will end up being delivered to the client, without requiring the clients to get in line in order to feel all their privileges and importance inside the organization.
a few. Human Resources
Practice: In a branch, there’s limited employees that operates the machine (4 personnel per branch). There are times which the clients started to be disappointed about Long Lines, Long is waiting, etc . and they’ll notice the quantity of employees should be increased to give faster assistance. Since we know that management contains a way upon determining about how many workers that is necessary in a department to operate, it requires time to wait for new seek the services of employee that will be given on the certain branch.
Recommendation: Since the Company can be implementing a Lean Part Model; they are going to hire even more competent people to be qualified, give satisfactory workshops and seminars to help their staff to develop and to be well prepared on theirassigned tasks. The organization must work with Auxiliary employees to fill up the difference of a branch office and prevent long term complaints.
some. Trainings
Practice: To the Faithful employees with the bank who have are working for many years in the organization, they are sometimes familiarized on the Job they’re performing and since that they almost know all about the operations as well as the systems with the bank, at times they’re having a hard time to know the new program without the current trainings and workshops.
Advice: Give staff the trainings and workshops they deserved especially for people who is employed by the company for many years. This is the one who remains devoted to the business and they must be given training on updated systems and functions.
5. Job Rotation/Employee Rotation
Practice: Because there are one-man staff inside the part, employees aren’t given the opportunity to be familiarized on one more job in order to learn how the entire branch runs. There are some circumstances you need to learn how to do one other job because your co-worker is usually sick or perhaps you need to be given to another branch because there’s also a risk about being familiar or placed on our clients.
Suggestion: Job rotation can help staff be more effective. Rotation may raise member of staff morale since they get to try new jobs, and so boredom and burnout are less of a problem. Sometimes employees may be more unlikely to get in touch with sick, appear late or quit. Personnel can also master skills on one job that can be applied to one more job, which in turn helps them perform job more efficiently. That is why cross schooling increases productivity to the staff.
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