The relationship between unit trust (mutual funds) performance and subsequent investment flows into and out of funds has been, for decades, the focus of many international studies. This study builds on the prior findings of the flow-performance relationship and aims to quantify the inflow into...

Valuation is the heart of finance and investment decision making. Shareholders, analysts and company officers all need to be able to measure the worth of a company if they are to make investment decisions or alternatively create value within the company. Although several methods exist to value...

Effective working capital management assists a firm in achieving improved liquidity through the management of the components of receivables, inventory and payables. Previous studies have established that changes in working capital have a strong positive correlation to profitability and that...

The ability to accurately price equity is an ineluctable requirement within businesses where decisions need to be taken daily that impact upon the future viability of that business. The Capital asset pricing model (CAPM) is the preeminent tool, that has become entrenched within academia and...

Financial theory posits a positive relationship between the value of investment that firms undertake and subsequent shareholder returns. Surprisingly, recent studies on United States data have found a negative relationship between investment and subsequent shareholder return. This anomaly...

The ability to accurately estimate systematic risk (or beta) when reference-day risk is considered is an ineluctable requirement for all applications of the capital asset pricing model (CAPM). This research documents evidence of reference-day risk for shares on the Johannesburg All Share Index....

Fund managers earn a portion of their fees by out-performing a benchmark, typically an index. To out-perform, they may leverage the fund or engage in scrip lending, but usually they 'stock-pick', taking positions in the market which differ from those of the benchmark, namely: 'active share'....

Fama and French (1992), in a controversial paper at the time, noted strong associations between cross-sectional equity returns and so-called style variables including size, the price to earnings (P/E) ratio, gearing and the book to market (B/M) ratio. Other researchers have subsequently...

Fama's (1970) efficient market hypothesis (EMH) and the capital asset pricing model (CAPM) jointly ascribed to Markowitz (1952), Treynor (1961), Sharpe (1964), Lintner (1965) and Mossin (1966) remain the foundation of most finance and investment courses. This is surprising, given the sustained...

The Insider Trading Act of 1999 and Johannesburg Stock Exchange (JSE) regulations require transparency in director dealings. Directors are required to report all share trading in companies of which they are principals, and this information has been regarded as a signal to the market. We examine...