On IMF Debt and Capital Control: Evidence from Malaysia, Thailand, Indonesia, the Philippines and South Korea


The Asian financial crisis was a time of financial catastrophe that grasped quite a bit of East Asia starting in July 1997 and raised reasons for alarm of an overall economic emergency. This study investigates the effects of capital control and external debts during the 1997 financial crisis, and whether a country should impose capital control or opt for external debt to recuperate from the crisis. Utilizing system estimation approach, an econometric model is devised by employing panel data for Malaysia, Thailand, Indonesia, the Philippines and South Korea over the period from 1990 to 2000. Our findings suggest that on average the ASEAN economies choosing external debt perform better in achieving greater economic growth and rebounding compared to economies that imposed capital control.

Order imbalance and selling aggression under a shorting ban: Evidence from the UK



Imtiaz Mohammad Sifat and Azhar Mohamad

Highlights of the Study

  • We employ high-frequency data from the London Stock Exchange during shorting ban in 2008.
  • We find that order imbalance rises after the FSA’s ban. 
  • Market quality deteriorates following the ban on naked short selling. 
  • Selling aggression and market quality markers fail to improve after the FSA’s ban.


Order imbalance is one of the indicators used by traders to assess the excess of buy or sell orders for a security traded on an exchange. Order imbalance data are made transparent to market participants so as to enhance the quality of the opening and closing auction in the exchange. While order imbalance can result from escalating volatility of security prices, traders can protect themselves by using a limit instead of a market order. The order imbalance and other market quality measures are expected to worsen when a market is experiencing heavy shorting. Based on a high-frequency intraday dataset from the London Stock Exchange from September 2008 through April 2009, our findings suggest that the order imbalance rose after the ban on short selling was enacted in the UK stock market and that selling aggression as well as other market quality measures showed no evidence of any marked improvement.

JEL classification
G14; G18
Short selling; Market quality; Order imbalance; Intraday volatility; Regulation


Tel.: + 603 61964752; fax: + 603 61964850.

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Implied Volatility in Singaporean Structured Warrants (2014-2015)


Options traders regard implied volatility a vital variable to determine profitability in options trading and use it to estimate the underlying stock’s volatility in the future. While it cannot predict market direction, it has a reputation for forecasting — to a certain extent — potential for large swings by the underlying stock. Once implied volatility is calculated, traders can estimate how high and low the stock can swing by the option’s expiration, and this probable estimation aids in making informed trading decisions. In this paper, we examine the information content of implied volatility of structured warrants in Singapore Stock Exchange (SGX). Using a daily dataset for 252 trading days for a period between August 1, 2014 and July 31, 2015, we test whether implied volatility is an unbiased estimate of realized volatility, if implied volatility contains information on future realized volatility, scrutinize the efficiency of implied volatility and its predictive power compared to historical volatility. Our findings suggest that for although implied volatility does contain some relevant information about future volatility, it is a biased forecast of realized volatility, the efficiency threshold of implied volatility is nugatory, and its predictive power is not superior to historical volatility.


Co-authored with Ismail, Najmi and Mohamad, Azhar

Under review for the 29th Asian Finance Association        Conference, 2017.

Predicting Financial Distress based on Corporate Actions: Malaysian Evidence


Despite abundance of literature in the area of financial distress prediction modelling, very little research has been conducted on the field of the ability of corporate actions in predicting financial distress. The current use of accounting information for financial distress prediction poses problem of information of not being current while corporate actions taken by firms are disclosed promptly. The objective of this study is to investigate which corporate actions can help to predict financial distress and to investigate whether prediction of financial distress using corporate actions can improve classification accuracy compared to accounting ratios. We also compare a model based on a combination of accounting ratios and corporate actions with models using these information separately. Using a Logistic Regression with a sample of 54 Malaysian Public Listed Companies we come up with three models- we find the use of corporate actions as financial distress predictors improves the classification accuracy of the model to 92.6 per cent, which is higher compared to the use of only accounting ratios or a combination of accounting ratios and corporate actions.  We also find that the frequency of new issue of capital and frequency of changes in Audit Committee are significant predictors of financial distress. Furthermore, we find that Working Capital to Total Assets Ratio and Asset Turnover Ratio are reliable predictors of financial distress among the accounting ratios.

  • Preliminary findings of this paper were presented at 3rd International Conference on Global Business & Social Entrepreneurship at Johor Bahru, Johor in 2016. The paper is presently submitted for consideration at a Scopus indexed journal. 
  • Co-authored with Dr. Azhar Mohamad and Mohamed Azad
  • In this study we analyze the predictive ability of a number of corporate actions taken by Malaysian public listed companies. We find that frequency of new issue of shares and changes in Audit Committee are statistically significant at predicting financial distress. We also find that the model using only corporate actions to predict financial distress can improve the classification rate of financially distressed firms to 92.6% compared with the baseline model of 66.7%.


Innovation in Classroom as a Means to Inspire Innovation in Society: The Case for Project Based Learning

Title of Project

Innovation in Classroom as a Means to Inspire Innovation in Society: The Case for Project Based Learning


Tanzima Sultana & Imtiaz Sifat

Name of Event

International Conference on Social Innovation 2016


ISM (Institut Sosial Malaysia)


Project Based Learning—learning by experience and doing—emerged as an experimental alternative to the conventional teaching methods in order to improve cognitive and meta-cognitive abilities of the students. Rote learning, which has long been the mainstay of orthodox educational system, stresses inordinately on the final result and has been linked with stifling creativity, innovation, and enterprise. Conversely, Project Based Learning adopts a unique approach by emphasizing the journey of learning rather than its destination. In other words, it is more a process than a product, which aims to incorporate higher order thinking skills and instill virtues of creativity, imagination, and innovation in students’ repertoire. In this paper we advocate embracing this method of pedagogy into the central curriculum and argue for its potency in fostering innovation and thus bringing a wave of change into the social structure as its implementation promises to nurture a group of skilled, creative, and productive citizens for the global community.


Factors Inhibiting Adoption of Green Investment: Evidence from Malaysia


Despite the surge of ethical and ecologically tenable green investing and banking alternatives worldwide, such options are yet to proliferate in frontier markets such as Asia. This green industry—if it can be called one—is still in an embryonic stage. Though prominent financial institutions like merchant banks and mutual funds have pledged to operate and invest in a green environment, the adoption rate is still painfully slow. Like most nascent products, the green investment industry still confronts challenges to generate enough interest to grow and stay competitive to the conventional counterparts. This study attempts to investigate the constraining factors which stifle the growth of the green investment industry from a Malaysian perspective. In addition, this study attempts to find ways on how they can increase their market share locally. To attain this objective primary data was collected through survey method in Selangor region. Upon analysis, we found that product awareness is positive and significantly determined the selection of green banking and investment products while rate of return negatively determined the customers’ selection. Hence, customers need to be made more aware of the existence and the philosophy behind such investment products before they choose to opt for it. In addition, rate of return appears to have a weak connection to customers’ preference towards green investment products. It is expected that this study would furnish ideas to the proponents of green philosophy and campaigners of sustainable practices on how to generate more interest in investing in sustainable and earth-friendly economic practitioners.