FAANG Stocks, Gold, and Islamic Equity: Implications for Portfolio Management during COVID-19
During the COVID-19 pandemic, technology stocks, such as FAANG stocks (Facebook, Amazon, Apple, Netflix, and Google), attracted the attention of global investors due to the vast use of technology in daily business. However, technology stocks are generally considered risky stocks; hence, efficient ri...
| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
| Published: |
MDPI AG
2023-01-01
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| Series: | Risks |
| Subjects: | |
| Online Access: | https://www.mdpi.com/2227-9091/11/1/19 |
| _version_ | 1797437342486626304 |
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| author | Kashif Saleem Osama AlHares Haroon Khan Omar Farooq |
| author_facet | Kashif Saleem Osama AlHares Haroon Khan Omar Farooq |
| author_sort | Kashif Saleem |
| collection | DOAJ |
| description | During the COVID-19 pandemic, technology stocks, such as FAANG stocks (Facebook, Amazon, Apple, Netflix, and Google), attracted the attention of global investors due to the vast use of technology in daily business. However, technology stocks are generally considered risky stocks; hence, efficient risk management is required to construct an optimal portfolio. In this study, we investigate the volatility spillovers and dynamic conditional correlations among the daily returns of FAANG company stocks, gold, and sharia-compliant equity to construct the optimal portfolio weights and hedge ratios during the COVID-19 pandemic period by utilizing a multivariate GARCH framework. The dynamic conditional correlations reveal that both gold and sharia-compliant equities exhibit lower correlations with FAANG stocks during the COVID-19 pandemic, implying opportunities for portfolio diversification. The findings indicate that gold and shariah-compliant equity are good candidates to hedge FAANG stocks. These findings are highly relevant for international investors, asset managers, hedgers, and portfolio managers. |
| first_indexed | 2024-03-09T11:18:49Z |
| format | Article |
| id | doaj.art-10a84d50e64a4cef954a34a2f43f0aa4 |
| institution | Directory Open Access Journal |
| issn | 2227-9091 |
| language | English |
| last_indexed | 2024-03-09T11:18:49Z |
| publishDate | 2023-01-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Risks |
| spelling | doaj.art-10a84d50e64a4cef954a34a2f43f0aa42023-12-01T00:23:34ZengMDPI AGRisks2227-90912023-01-011111910.3390/risks11010019FAANG Stocks, Gold, and Islamic Equity: Implications for Portfolio Management during COVID-19Kashif Saleem0Osama AlHares1Haroon Khan2Omar Farooq3Faculty of Business, University of Wollongong in Dubai, Dubai P.O. Box 20183, United Arab EmiratesFaculty of Business, University of Wollongong in Dubai, Dubai P.O. Box 20183, United Arab EmiratesFaculty of Business, University of Wollongong in Dubai, Dubai P.O. Box 20183, United Arab EmiratesSchool of Business, ADA University, Baku P.O. Box AZ1008, AzerbaijanDuring the COVID-19 pandemic, technology stocks, such as FAANG stocks (Facebook, Amazon, Apple, Netflix, and Google), attracted the attention of global investors due to the vast use of technology in daily business. However, technology stocks are generally considered risky stocks; hence, efficient risk management is required to construct an optimal portfolio. In this study, we investigate the volatility spillovers and dynamic conditional correlations among the daily returns of FAANG company stocks, gold, and sharia-compliant equity to construct the optimal portfolio weights and hedge ratios during the COVID-19 pandemic period by utilizing a multivariate GARCH framework. The dynamic conditional correlations reveal that both gold and sharia-compliant equities exhibit lower correlations with FAANG stocks during the COVID-19 pandemic, implying opportunities for portfolio diversification. The findings indicate that gold and shariah-compliant equity are good candidates to hedge FAANG stocks. These findings are highly relevant for international investors, asset managers, hedgers, and portfolio managers.https://www.mdpi.com/2227-9091/11/1/19COVID-19FAANG stocksIslamic Equityportfolio management |
| spellingShingle | Kashif Saleem Osama AlHares Haroon Khan Omar Farooq FAANG Stocks, Gold, and Islamic Equity: Implications for Portfolio Management during COVID-19 Risks COVID-19 FAANG stocks Islamic Equity portfolio management |
| title | FAANG Stocks, Gold, and Islamic Equity: Implications for Portfolio Management during COVID-19 |
| title_full | FAANG Stocks, Gold, and Islamic Equity: Implications for Portfolio Management during COVID-19 |
| title_fullStr | FAANG Stocks, Gold, and Islamic Equity: Implications for Portfolio Management during COVID-19 |
| title_full_unstemmed | FAANG Stocks, Gold, and Islamic Equity: Implications for Portfolio Management during COVID-19 |
| title_short | FAANG Stocks, Gold, and Islamic Equity: Implications for Portfolio Management during COVID-19 |
| title_sort | faang stocks gold and islamic equity implications for portfolio management during covid 19 |
| topic | COVID-19 FAANG stocks Islamic Equity portfolio management |
| url | https://www.mdpi.com/2227-9091/11/1/19 |
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