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Investment strategies with rebalancing: How could they serve Sukuk secondary market?

Rida Ahroum, Othmane Touri, Fatima-Zahra Sabiq and Boujemâa Achchab

Borsa Istanbul Review, 2018, vol. 18, issue 2, 91-100

Abstract: Although the Sukuk market is rapidly growing, it still faces many challenges. The “Buy and hold” effect slows down this growth as it freezes the exchange of these assets in the secondary market. In this perspective, this paper introduces an approach aiming at improving Sukuk exchange by using the diversity of the investors' risk profiles. Through this study that applies several investment strategies based on rebalancing, we demonstrate that these strategies have the potential to boost the Sukuk market's growth. This is actually due to the fact that the investor can choose among these strategies according to his investment profile and his market anticipation. However, this approach's effectiveness is conditioned to the adherence of a large number of investors. In terms of contribution, this paper fills the gap in the literature by introducing a pragmatic approach to reduce the impact of the “Buy and Hold” effect on the Sukuk market.

Keywords: Sukuk; Buy and hold effect; Investment strategy; Rebalancing; Secondary market (search for similar items in EconPapers)
JEL-codes: C01 C49 C52 D49 G11 G15 (search for similar items in EconPapers)
Date: 2018
References: Add references at CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:bor:bistre:v:18:y:2018:i:2:p:91-100

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