/jurnalpengurusan Sun, 09 Oct 2022 04:37:46 +0000 en-US hourly 1 https://wordpress.org/?v=6.9.1 /jurnalpengurusan/article/risk-adjusted-performance-of-malaysian-real-estate-investment-trust-funds/?utm_source=rss&utm_medium=rss&utm_campaign=risk-adjusted-performance-of-malaysian-real-estate-investment-trust-funds Sun, 09 Oct 2022 04:37:46 +0000 /jurnalpengurusan/?post_type=article&p=4078 This study evaluates performance and risk features of Malaysian REIT funds from 2007-2012. Performance evaluation methods employed are Sharpe, Treynor, Jensen, and M-squared measures. The results indicate that beta values are all less than one and that the total risk of REIT funds comes mostly from the unsystematic risk component. While the results emphasize the importance of embedding risk into performance analyses, the findings also provide caution that differences in the risk measures employed give rise to contradictory performance rankings. The low R-squared values for REIT funds suggest low reliability of beta coefficients. The findings therefore imply that the Sharpe ratio and the M-squared measure which quantify risk using standard deviation of return provide more convincing and meaningful performance evaluation than the Treynor and Jensen measures. The results of M-squared measure also illustrate how leverage can be applied as a tool in achieving optimal REIT performance. The findings provide good insights to managers in assessing REIT performance and to investors who are considering REIT as a potential investment vehicle.

]]> /jurnalpengurusan/article/debt-and-financial-performance-of-reits-in-malaysia-a-moderating-effect-of-financial-flexibility/?utm_source=rss&utm_medium=rss&utm_campaign=debt-and-financial-performance-of-reits-in-malaysia-a-moderating-effect-of-financial-flexibility Sat, 08 Oct 2022 05:12:24 +0000 /jurnalpengurusan/?post_type=article&p=1827 The use of debt by REITs entity seems to be a puzzle in numerous REITs literature, as REITs are tax-exempted business entities. The trade-off theory implies that the financing strategy of using debt provides no value in a REIT entity with a marginal tax rate of zero. However, high dividend pay-out requirement has limit REITs’ ability to retain its internal earnings, thus require REITs to use debt to undertake its growth strategies. This study aims to investigate the great curiosity about the debt financing decision of REITs in Malaysia (MREITs) at all given no tax shield benefit and to examine the moderating effect of financial flexibility in a relationship between debt financing and the financial performance. Using the unbalanced panel data from all MREITs for the time period between 2005 and 2014, the results of this study are consistent with the pecking order theory in explaining the MREITs debt financing decision but are less supportive of the trade-off theory on tax benefits and agency theory of free cash flow on disciplinary tools. This suggests that MREITs use debt to support the growth needs than tax motives and the high dividend pay-out requirement behaves as a “disciplinary tool,” not through the use of debt. The findings also reveal that financial flexibility plays an important role to alter the negative relationship between debt financing and financial performance to positive relationship. This study serves as a useful guide for MREITs’ managers in managing financial flexibility as it has important moderating effects on the relationship between debt financing and financial performance.

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