Sectoral Betas: Pre and Post CPEC Announcement Comparison

Proceedings of the 29th IBIMA Conference, 3-4 May 2017

10 Pages Posted: 30 May 2017

See all articles by Maryam Zafar

Maryam Zafar

Institute of Business Management (IoBM)

Nawaz Ahmad

RTS (Research, Trainings, and Solutions); Institute of Business Management (IoBM)

Date Written: May 4, 2017

Abstract

CPEC, a mega project that aims to connect Gwadar from Kashghar, is not only a game changer for China and Pakistan but it is for the whole region. This research paper will disclose the impact of the announcement of CPEC on different sectors including cement, automobile, banking, insurance and steel. Excess returns of stock were determined and taken as dependent variable, whereas; excess returns of KSE 100 were taken as independent variable. Simple regression technique was used to interpret beta and sig values. Because of the increased local demand and high import rate, 4 out of 5 betas showed downfall, however; sig values remained highly significant. More local industries to be setup to meet the rise in demand and to maintain the level of betas. It will be a win-win situation for foreign investors as the rate of local manufacturing is comparatively lower than the current demand of goods because of the increased rate of CPEC related developments.

Keywords: CPEC, Sensitivity, Beta, CAPM

JEL Classification: C12, G11

Suggested Citation

Zafar, Maryam and Ahmad, Nawaz, Sectoral Betas: Pre and Post CPEC Announcement Comparison (May 4, 2017). Proceedings of the 29th IBIMA Conference, 3-4 May 2017. Available at SSRN: https://ssrn.com/abstract=2975786 or http://dx.doi.org/10.2139/ssrn.2975786

Maryam Zafar

Institute of Business Management (IoBM) ( email )

Plot # 84
Korangi Creek
Karachi, Sindh 75190
Pakistan

Nawaz Ahmad (Contact Author)

RTS (Research, Trainings, and Solutions) ( email )

9th Nishat Lane, DHA 6
9th Nishat Lane, DHA 6
Karachi, Sindh 75500
Pakistan
00923009292422 (Phone)

Institute of Business Management (IoBM) ( email )

Plot # 84
Korangi Creek
Karachi, Sindh 75190
Pakistan

HOME PAGE: http://www.faculty.iobm.edu.pk/staff/nawaz-ahmad/

Register to save articles to
your library

Register

Paper statistics

Downloads
78
Abstract Views
343
rank
305,900
PlumX Metrics