The Causes and Effects of World War II Essay Example For Students

The Causes and Effects of World War II Essay Outline1 Introduction2 Causes of World War I3 Effects of World War II4 Conclusion Introduction World War II was a conflict that touches many nations and had a duration for almost 6 years. It was not the first time when people lost peace among them. Those who are aware of history know that previously World War I was taken place and it was not resolved as needed. On this ground, the second conflict burnt out and spread all over Europe and involved the United States. It was a difficult time for each person. The war is associated in people’s mind with horrible pictures of the loss of close family, the poverty, the fear that filled the heart of individuals, and the loss of a significant part of the generation. We will write a custom essay on The Causes and Effects of World War II specifically for you for only $16.38 $13.9/page Order now World War I was definitely the difficult experience, but World War II appeared to be the worse. Zit took too many lives, and lots of innocent residents suffered without even knowing how the conflict started and what the purpose of their hard condition was. The great list of countries took the participant on this occasion including the European countries, Japan, and the United States. Each of them has their own goals and purpose to fight. Some of them could not stand the growth of Adolf Hitler position and his racist politics. When the conflict started not many people would say it will long for such a period and bring so many troubles for the world. In this argumentative essay, you are going to see what the main causes of World War II were and how the conflict impacted the different spheres of the human’s life. Causes of World War I Among the long list of causes that scholars are struggling to define the greatest and the main reason is an unstable condition in the relationships after the World War I. It was the conflict that covered such massive territories and after its end, it was not actually resolved in a proper way. The United States took part in that first conflict in order to establish democratic positions in the world. This is obvious from the speech of the president of the United States, Wilson. However, the end of the first conflict filled the hearts of the residents with a deep feeling of the bitterness that eventually burnt into the second war. People eventually obtained the peace, but it was not accomplished in their conscious. Among the list of others extremely significant were economic causes. Adolf Hitler and his country were defeated in the previous conflict, and they were supposed to repay for the damages they created. The problem of unemployment aroused with rapidness in Germany and quickly spread into the other countries of Europe. Terrific inflation turned the German’s money into nothing. There was no time for Japan, countries in Europe, and America to solve the problem of the world condition as each of them was involved in the inner problems of the country. The economic depression of the large standards met the world. Citizens struggle for changes, but there was not a leader who would help them with this. After World War I, Adolf Hitler appeared in the Germany government becoming a large influencer with his propaganda of Nazism. Adolf Hitler settled himself as a strong influential leader people were forced to obey. This obedience was one of the main prompts of his politics. Such strong leaders appeared in other countries, and their politics was followed by racism and violence. The persuasive claim states that the war began by the leader of Italy and his use of weapons. It quickly spread having involved Spain, Russia with its fascism system and German with its politics of the highest race. In the middle of the conflict, Japan was also involved. Americans tried to avoid their participation but it was impossible, and they took a participant eventually. .u5613ea696354eb80bda28365b99d8c20 , .u5613ea696354eb80bda28365b99d8c20 .postImageUrl , .u5613ea696354eb80bda28365b99d8c20 .centered-text-area { min-height: 80px; position: relative; } .u5613ea696354eb80bda28365b99d8c20 , .u5613ea696354eb80bda28365b99d8c20:hover , .u5613ea696354eb80bda28365b99d8c20:visited , .u5613ea696354eb80bda28365b99d8c20:active { border:0!important; } .u5613ea696354eb80bda28365b99d8c20 .clearfix:after { content: ""; display: table; clear: both; } .u5613ea696354eb80bda28365b99d8c20 { display: block; transition: background-color 250ms; webkit-transition: background-color 250ms; width: 100%; opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #95A5A6; } .u5613ea696354eb80bda28365b99d8c20:active , .u5613ea696354eb80bda28365b99d8c20:hover { opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #2C3E50; } .u5613ea696354eb80bda28365b99d8c20 .centered-text-area { width: 100%; position: relative ; } .u5613ea696354eb80bda28365b99d8c20 .ctaText { border-bottom: 0 solid #fff; color: #2980B9; font-size: 16px; font-weight: bold; margin: 0; padding: 0; text-decoration: underline; } .u5613ea696354eb80bda28365b99d8c20 .postTitle { color: #FFFFFF; font-size: 16px; font-weight: 600; margin: 0; padding: 0; width: 100%; } .u5613ea696354eb80bda28365b99d8c20 .ctaButton { background-color: #7F8C8D!important; color: #2980B9; border: none; border-radius: 3px; box-shadow: none; font-size: 14px; font-weight: bold; line-height: 26px; moz-border-radius: 3px; text-align: center; text-decoration: none; text-shadow: none; width: 80px; min-height: 80px; background: url(https://artscolumbia.org/wp-content/plugins/intelly-related-posts/assets/images/simple-arrow.png)no-repeat; position: absolute; right: 0; top: 0; } .u5613ea696354eb80bda28365b99d8c20:hover .ctaButton { background-color: #34495E!important; } .u5613ea696354eb80bda28365b99d8c20 .centered-text { display: table; height: 80px; padding-left : 18px; top: 0; } .u5613ea696354eb80bda28365b99d8c20 .u5613ea696354eb80bda28365b99d8c20-content { display: table-cell; margin: 0; padding: 0; padding-right: 108px; position: relative; vertical-align: middle; width: 100%; } .u5613ea696354eb80bda28365b99d8c20:after { content: ""; display: block; clear: both; } READ: Pearl Harbor EssayEffects of World War II Those who are close to history know that World War I had awful consequences, but the effects of World War II were even worse. People obtained the peace on their territories, but there were so many effects of World War that were impossible to be solved easily. The huge number of individuals was lost in the battles, and many of them afterward had lost their homes. The terrific pictures were hard to be destroyed, and they suffered from the emotional pressure. Europe had eventually met the changes and peace, but they were reached by the too expensive methods. World War II stopped the dictatorship among the nations, and this fact belongs to the positive effects of world war. The USA and Russia showed themselves as powerful influencers in the world. Presidents discussed how to save the peace for the later years and continued the formation of Europe borders. The most successful in the territorial division was the Soviet Union that received large parts of the world. Germany was divided into several parts and was controlled by different countries. However, nothing was too simple as the end of World War II did not mean the end of the Cold war between Russia and the USA that lasted until 1999. There were also visible effects of World War in the economic sphere of the world. The great depression that was appeared between the two conflicts was urgent to be solved. It should be said that they are positive enough and led to enormous changes. At the same time, everything was in a huge mess and chaos after the war and was complicated to remain the previous condition. During the war, lots of jobs appeared that solved a little bit the problem of massive unemployment. However, other industries were not necessary, and the economics during the war was paused. It was a great challenge for people to find a second life and relive everything. Actually, it took several years to be established well and to find proper vision how to act further. Conclusion World War II was a second conflict that covered almost all nations in the world. It was aroused on the base of unsolved consequences after the end of World War I and took a long time to be stopped and resolved. This conflict was not between concrete people but touched the whole of Europe, Japan, and even the United States. Each of them has its own special goals. For example, the president of America stated that Europe was not ready to meet the democracy and the country saw its mission to prepare the way for democratic positions. However, the plain citizens who were involved in the war did not even understand what they were fighting for. The conflict took huge massive spread and had horrible complicated consequences. The end of the war has brought peace for nations and huge changes. People need several years to find new forces and energy to live further and develop their economic conditions. It was not easy for all of the countries to relive, but the eventual consequences led to extraordinary results. The world has turned into a new one, and the words of American president Roosevelt came to life. He stated that the world would come to the state when every nation knows how to live in peace with each other.

How to become an OTR driver

How to become an OTR driver When you think of the phrase â€Å"truck driver,† you’re probably envisioning an over-the-road (OTR) truck driver: someone who drives a big rig long distances to deliver a load of freight. As opposed to delivery drivers, who typically have set local routes, OTR truckers can transport goods across the county, state, or even country. There’s something very appealing and old-school about the idea of hitting the open road- is it the right option for you? What does an OTR trucker do?OTR trucking (also known as long-haul trucking) is a type of driving that involves using large tractor-trailer trucks to haul freight of all kinds (including heavy loads of goods, machinery, or other equipment) long distances. Routes are typically across state lines, and may include parts of the United States and Canada- basically anywhere accessible by main roads and highways.This is definitely not your typical 9-to-5 job. These drivers work on demanding schedules and can be away from hom e for weeks at a time. These schedules may require driving nights, weekends, or holidays to meet unforgiving deadlines. It can also be a very solitary job, with drivers often traveling alone on long trips.What skills does an OTR trucker have?OTR truckers are masters of logistics and need to have a number of skills ready to go, on the road or not.Driving Skills:  This may seem like a no-brainer, but OTR drivers require some next-level driving skills. Drivers should drive with an eye on safety and their freight at all times. And in addition to a commercial driver’s license (CDL), a clean driving record is essential for scoring a job in OTR trucking.Mechanical Skills:  Out on the road, you may need to be your own mechanic, if something happens out of AAA range or a place where the nearest mechanic is miles away. OTR drivers should have a solid base set of mechanical skills to be able to troubleshoot minor mechanical difficulties along the way.Time Management Skills:  Nothi ng drives (pun mostly intended) a trucker’s world more than the delivery schedule. Truckers need to be able to manage their time independently and efficiently to make sure they’re delivering their freight on schedule.Self-Starter Skills:  Out on the road, you won’t have a boss looking over your shoulder to make sure you’re doing everything that needs doing or staying on task and on time. Truckers should be able to independently determine what needs to be done and develop a game plan for delivering the load on schedule and without major issues.What do you need to become an OTR trucker?The most essential step in becoming an OTR driver is getting your CDL certification. The licensing process may vary by state, but will involve a combination of a written test and a practical driving test. As with any driving test, you can go it alone and try to cram on your own, but there are many commercial driving schools that offer programs that train you, walk you throu gh testing, and prepare you for what life will be like as an OTR driver. The CDL focuses on the skills and mechanical know-how necessary to operate large tractor trailers. You can also get optional certification in specialties like transporting hazardous materials.How much do OTR drivers get paid?According to the U.S. Bureau of Labor Statistics, the median annual salary for delivery drivers is $41,430, or $19.87 per hour. This can vary pretty widely, depending on factors like the driver’s experience level, the type of freight being transported, and the distance. Some drivers are paid a flat rate for an entire trip, while others are paid by the mile.What’s the outlook for OTR drivers?This is a very steady field and will continue to be so. The U.S. Bureau of Labor Statistics anticipates that the OTR driving field will grow by about 5% by 2024.

Statement of professional Goals Essay Example | Topics and Well Written Essays - 250 words - 1

Statement of professional Goals - Essay Example This will help me in my career progression in that it will enable me to go for leadership and managerial positions in reputed organizations. This degree will prove to be a fruitful extension of my qualification in that I will become a competent professional in fields like tourism and hotel management. I anticipate that organizational expectations of hospitality managers have increased. In today’s modern business world, a hospitality manager conveys a strong impression when she looks for a job. She is given more supervisory duties, which I am sure that I am capable of performing. I believe that keeping in view my academic qualification, and my need to complement my previous degree, the authorities will definitely consider my application for admission in their reputed university. I assure that I shall prove to be a competent student for your university and a reputed professional in the

Argumentative (Should marijuana be legalized in the U.S.) Essay

Argumentative (Should marijuana be legalized in the U.S.) - Essay Example The legalization of marijuana is the focus of contemporary debate in the US. Colorado and Washington have legalized its use and several other states appear poised to follow suit. Legal penalties for the possession of marijuana are being lifted and decriminalized. This legalization of marijuana is extremely bad for society and deserves to be strongly opposed. Marijuana should not be legalized in the US because it has adverse health effects, and legalization will increase its use and its cost burdens. Marijuana has adverse physical and mental effects, as illustrated by the health problems associated with its usage. According to the National Institute on Drug Usage, marijuana smoking affects the brain and leads to impaired short-term memory, perception, judgment and motor skills. Marijuana users also experience difficulty in concentration, trance-like states, lowered driving and other psychomotor skills, slowed reaction time, impaired goal-directed mental activity, and altered periphera l vision. In another example in the New England Journal of Medicine, 45% of reckless drivers (excluding those under the influence of alcohol), tested positive for marijuana.   Intense anxiety, panic attacks or paranoia are also seen in cases of marijuana usage. Marijuana cigarettes contain the carcinogen Benzopyrene which is linked to lung cancer. Other symptoms include airway injury, acute  and chronic bronchitis, inflamed sinuses, lung inflammation, and vulnerability to pulmonary infection. Marijuana weakens the body’s immune system and leads to decreased motivation. It affects the hormones, resulting in delayed puberty, low sperm count and menstrual disruption  (Frontline). The legalization of marijuana will increase its availability and its use. This is particularly disturbing as â€Å"Marijuana is the most commonly used illicit drug in the United States, with nearly 17 million Americans age 12 and older reporting past?month use, and 374,000 people entering an emer gency room annually with a primary marijuana problem† (White House web site). Legalization would naturally result in a steep fall in marijuana prices, making it affordable to more users, especially adolescents. This is illustrated by the case of gambling, tobacco and alcohol: statistics show that legalization increased use and availability. The Netherlands is a real-time example. Data from the Rand Corp. shows that, with marijuana legalization, its use â€Å"increased consistently and sharply† and tripled among young adults. Legalization â€Å"triggered commercialization† (Sabet). This result will be multiplied in America's ad-driven culture. The promise of profit will encourage aggressive marketing. Closer to home, we have the example of Alaska. Alaska legalized marijuana in the 1970’s. Subsequently, â€Å"teen marijuana use jumped to twice the national average† (CNBC). The state recriminalized marijuana in 1990.    The legalization of marijuana will increase cost burdens. The tax revenue generated through the legalization of marijuana will be off-set by higher social costs. This is again illustrated by the precedent of tobacco and alcohol. The Federal and State tax on alcohol is â€Å"less than 10 percent of the estimated $185 billion in alcohol?related costs to health care, criminal justice, and the workplace in lost productivity† (White House).   Similarly, the annual social cost of smoking lags far behind the tax revenue generated by tobacco. It is estimated that 9 percent of marijuana

Describe Fingerprint photographic technique you would use to recover Assignment

Describe Fingerprint photographic technique you would use to recover such marks following U.K. guidance - Assignment Example In general we have three types of fingerprints mainly latent, plastic and patent prints. Latent prints are formed from oils and sweat from the skin surface. They are invisible to un-aided eye, therefore; they require additional treatments. Patent fingerprints are made from ink, grease, dirt and blood. They are visible to the naked eye. Finally, the plastic fingerprints are in three-dimension, and they are made after pressing the hands on fresh soap, wax or paints. The prints are visible to the naked eye (Houck and Siegel, 2010, p. 29). To improve the visibility of latent fingerprints various lighting techniques can be used to obtain the invisible surfaces. According to Chaikovsky, Argaman, Batman, Sin-David, Barzovski and Yaalon (2005, p. 574), digital multiple exposure technique is applied. The process is simple and productive. Digital photography and computerized image processing with application of layers methodology produce many images that are easily controlled by computer programmes. Production of many images that are combined into a single image enables improved visualization of the selected portions of the latent print without affecting the rest part of the image. According to SIRCHIE (2013, p. 1), Crime scene photos are important in the crime scene inquiry. The photographs complement the investigator data in the form of data. A camera can be used to capture every object of importance within the crime scene. Warren (2014, p. 1), conducted a research to determine usage digital photography for forensic purposes. It was found out that digital imaging devices with spectral filters are very effective in the identification of untreated latent fingerprints in that it is viable and non destructive. According to the National Law Enforcement (2011, p. 6), it is believed that every individual has different body parts hence comparison of the measurements can be used to distinguish between two individuals. The method was developed by

Malaysian Conventional and Islamic Equity Mutual Fund

Malaysian Conventional and Islamic Equity Mutual Fund An Analysis Of Companies Portfolio Performance Using Sharpe Ratio: A Study On The Differences Of Performance Between Malaysian Conventional And Islamic Equity Mutual Fund In 2007 1.0 Introduction 1.0.1 Chapter Description In this chapter, explaining the background of the study, problem statement, objectives of the study, hypotheses, significance of this study, as well as the scope and limitations during the process of completing this study. 1.0.2 Background of the Study Portfolio evaluation is on the time before 1960. Investors evaluated portfolio performance almost entirely on the basis of the rate of return. They were aware of the concept of risk but did not know how to quantify or measure it, so they could consider it explicitly. Developments in portfolio theory in the early 1960s showed investors on how to quantify and measure risk in terms of the variability of returns. Still, because no single measure combined both return and risk, the two factors had to be considered separately as researchers such as Friend, Blume, and Crockett (1970). Specifically, the investigators grouped portfolios into similar risk classes based on a measure of risk (such as the variance of return) and compared the rates of return for alternative portfolios directly within these risk classes. Before 1960, investors evaluated portfolio performance almost entirely on the rate of return, although they knew that risk was a very important variable in determining investment success. The reason for omitting risk was the lack of knowledge on how to measure and quantify it. After the development of portfolio theory in early 60s, and CAPM in subsequent years, risk, measured as either by standard deviation or beta, was included in evaluation process. However, since there was not a single measure combining return and risk, two factors were to be considered separately that were researchers grouped portfolios into similar risk classes and compared rates of return of portfolios in the same risk class. There are many kinds of measurement such as Jensen, Treynor and also Sharpe to evaluate the companys portfolio performance. Jensens alpha has been a popular performance measure because it is a return concept. Related to Dr. William F. Sharpes contribution to style analysis of investment performance, the Sharpes alpha is related to the Jensens alpha in the sense that both measures excess returns. They differ, however, in the selection and construction of benchmarks. Sharpe (1966) developed a composite index which was very similar to the Treynor measure, the only difference was that it was being used as standard deviation, instead of beta. To measure the portfolio risk, the researcher needs the average rate of return for Portfolio during a specified time period, the average rate of return on risk-free rate during the same period, Sharpe performance index and the standard deviation of the rate of return for Portfolio during the time period. Sharpe preferred to compare portfolios to the capital market line (CML) rather than the security market line (SML). Sharpe index, therefore, evaluated funds performance based on both rate of return and diversification (Sharpe 1967). For a completely diversified portfolio Treynor and Sharpe indices would give identical rankings. Although the mutual fund industry in Malaysia started as far back as 1959 with the establishment of the Malayan Unit Trust Ltd, the development of the industry did not take-off until the 1980s with the launching of the Amanah Saham Nasional (ASN). In 2004, the Commission approved 17 new Syariah-based unit trust funds, bringing the total number of such funds to 71 or 24.4% of the total 291 approved funds in the industry as at the end of 2004 (2003: 55 funds or 24.3% of the total industry). Of the 71 Syariah-based unit trust funds, 14 were balanced funds, 14 were bond funds, 39 were equity funds, 2 two were fixed income funds and two were money market funds. The number of units in circulation for Syariah-based unit trust funds also increased from 8.59 billion units as at the end of 2003 to 13.16 billion units in 2004. The number of accounts registered an increase of 23.4% or 80,848 accounts, with a total of 427,000 accounts in 2004. One conventional fund made changes to its investment objectives and operations which enabled it to comply with the requirements of Syariah-based unit trust funds. In terms of value, the NAV of Syariah-based unit trust funds grew to RM6.76 billion representing 7.7% of the industry, an increase of 0.9% from the previous year. Over a 10-year period (1995-2004), the NAV of Syariah-based unit trust funds grew at a compounded annual growth rate (CAGR) of 26.18% while the overall industry CAGR was 7.89%. The recognition of the increasing dominance and importance of unit trusts as an investment instrument has spurred researchers to devise appropriate techniques to assess portfolio performance. The earlier works by Sharpe (1966), Treynor (1965) and Jensen (1968) represented significant contributions to the evaluation of portfolio performance. Therefore, the primary aim of this paper is to present new evidences for the analysis of companies portfolio performance using Sharpe ratio by studying the differences the performance between Malaysian conventional and Islamic Equity Mutual Fund in 2007. 1.0.3 Overview of Conventional and Islamic Mutual Fund Mutual fund or better known as unit trust in Malaysia is an investment vehicle created by asset management companies specializing in pooling savings from both retail and institutional investors. Individual investors seeking liquidity, portfolio diversification and investment expertise are increasingly choosing unit trust funds as their investment vehicle. However, these investors do differ in their preferences based on their risk threshold, liquidity needs and their needs to comply with religious requirement. In the Malaysian context, the performance of mutual funds or more popularly known as unit trust funds as reported by Shamsher and Annuar (1995), Tan (1995), Leong and Aw (1997), Annuar et al,. (1997) and Low and Noor A. Ghazali (2005) concluded that on average, funds were unable to beat the market. The number of unit trust has grown dramatically in recent years. Unit trusts are now the preferred way for individual investors and many institutions to participate in the capital markets, and their popularity has increased demand for evaluations of fund performance. Muslims are not allowed to invest in standard mutual funds since their religion prohibits them from investing in certain equities, like those of banks or companies that deal in pork, alcohol, pornography and certain entertainment related products. An Islamic mutual fund is similar to a â€Å"conventional† mutual fund in many ways; however, unlike its â€Å"conventional† counterpart, an Islamic mutual fund must conform to the Sharia (Islamic Law) investment precepts. The Sharia encourages the use of profit sharing and partnership schemes, and forbids riba (interest), maysir (gambling and pure games of chance), and gharar (selling something that is not owned or that cannot be described in accurate detail; i.e., in terms of type, size and amount) (El-Gamal 2000). The Sharia guidelines and principles govern several aspects of an Islamic mutual fund, including its asset allocation (portfolio screening), investment and trading practices, and income distribution (purification). When selecting investments for their portfolio (asset allocation), conventional mutual funds can freely choose between debt-bearing investments and profit-bearing investment, and invest across the spectrum of all available industries. An Islamic mutual fund, however, must set up screens in order to select those companies that meet its qualitative and quantitative criteria set by Sharia guidelines. 1.1 Problem Statement At some levels, people are always interested in evaluating the performance of their investments. Having to spend the time and incurred the expense to design an asset allocation strategy and select the specific set of securities to form their portfolios, investors whether they are individuals, corporations, or financial institutions. It must be periodically determined whether this effort is worthwhile. Investors in managing their own portfolios should evaluate their performance, as should those who pay one or several professional money managers to make these decisions for them. It is imperative to determine the realized investment performance which justifies the additional costs of engaging professional management. Comparing a portfolios historical returns to those produced by other managers or indexes can be instructive; such comparisons do not produce a complete picture of the portfolios performance. Indeed, the central tenet of the modern approach to performance measurement is that it is impossible to make a thorough evaluation of an investment without explicitly control the risk of the portfolio. Given the complexity and importance of the issues involved, it is not a surprise to learn that there is not a single universally accepted procedure for risk-adjusting portfolio returns. Nevertheless, there are several techniques that are commonly employed. Some previous studies found results that are inconsistent with Chuas findings. These studies include Ewe (1994), Shamsher and Annuar (1995), and Tan (1995). Shamsher and Annuar (1995), focused their study on the performance of 54 unit trusts covering the period of late 80s to early 90s. They found out that the returns on investment in unit trust were well below the risk free and market returns. Furthermore, the results indicated that not only the degree of portfolios diversification was below expectation but the actual returns and risk characteristics of funds were also inconsistent with their stated objectives. Tan (1995) analyzed performance of 12 unit trusts over a 10-year period, 1984-1993. He concluded that unit trusts in general perform worse than the market portfolio. Consistent with Chuas findings, Tan also concluded that government sponsored funds performed better than private funds. As we can see, there are three portfolio performance evaluation techniques that comprise the basic ‘toolkit for measuring risk-adjusted performance. Although some redundancy exists among these measures, each of them provides unique perspectives, so that best viewed as complementary measures. In particular, examining the controversy surrounding the selection of the proper benchmark to use in the risk-adjustment process and discussing why these benchmark problems become larger when beginning to invest globally. From here, how to evaluate the performance of the investments in order to reduce the risk taken? What measurement can contribute to evaluating a good investment? Therefore, it is interesting to analyze the companies portfolio performance by studying on the differences in the performance between conventional and Islamic equity mutual fund in Malaysia by using Sharpe ratio. 1.2 Objectives of Research The general purpose of this study is to analyze the companies portfolio performance using Sharpe ratio by studying on the differences in the performance between conventional and Islamic equity mutual fund in Malaysia. A careful review on those questions has led to the development of the following specific research objectives which are: i. To measure and rank both relative quantitative performances of mutual fund (conventional/Islamic) on the basis of their return, total risk, coefficient of variation and Sharpe ratio. The term performance contains both the return and the risk undertaken by these mutual funds. ii. To investigate whether both mutual funds (conventional/Islamic) are earning higher returns than the benchmark returns (or market Portfolio/Index returns) in terms of risk. iii. To determine the relationship between dependent variable and independent variable. 1.3 Scope of Study The study is on the analysis of the companies portfolio performance in determining the measure of average daily return, total risk (standard deviation), coefficient of variation and Sharpe ratio. Moreover, to observe the differences in terms of performance between conventional and Islamic mutual fund in the context of Malaysian capital market by comparing them to the stock market index or Kuala Lumpur Composite Index (KLCI) benchmark. The scopes of the study are stated as follow:  § The relationship between two variables: the return on equity mutual fund as the dependent variable whereas the return on stock market index (KLCI) as the independent variable for conventional and Islamic fund.  § The period of study will cover one (1) year starting from January 2007 to December 2007 using the daily basis collected from The Star and New Straits Times newspapers and also from the internet.  § This research will also focus on the conventional and Islamic Equity Mutual Fund companies available in Malaysia. 1.4 Theoretical Framework The theoretical framework shows the relationship between the independent variables and dependent variable. The independent variable is the return on KLCI while the dependent variable is the return of Equity Mutual fund companies in Malaysia. Schematic diagram for the theoretical framework in this study is as follows: Market Index Equity Fund Market Index Islamic Equity Fund Independent Variable Dependent Variable 1.5 Hypotheses According to Uma Sekaran (2003), a hypothesis can be defined as a logically conjectured relationship between two or more variables expressed in the form of testable statement. Hypothesis can be divided into two categories which are Ho which is a Null Hypothesis and Ha which is an Alternate Hypothesis. The term â€Å"null† can be thought of as meaning â€Å"no change† or â€Å"no difference†. The second hypothesis is called alternative hypothesis. It is summary of the case if the null hypothesis is not true. It is stated that Ha, the alternative hypothesis is a statement of a view that has been prepared to be accepted if Ho is rejected. The hypotheses of this study are: Hypothesis 1: Ho: There is no relationship between the return on KLCI and the return on Conventional equity mutual fund. Ha: There is a relationship between the return on KLCI and the return on Conventional equity mutual fund. Hypothesis 2: Ho: There is no relationship between the return on KLCI and the return on Islamic equity mutual fund. Ha: There is a relationship between the return on KLCI and the return on Islamic equity mutual fund. 1.6 Limitations of the Study Data Collection and Cost Limitation The major source of data gained is from the secondary sources. The data is only available at certain places and it requires cost to obtain the data. Besides, it also requires costs in the process of printing, photocopying, data services and transportations to obtain the information. The information about the topic studied is also difficult to search in the library because of the limited information. As a result, it causes problems to the researcher to gather and collect the information. The information and data related to the study is rather difficult to obtain. Thus, the accuracy of the study depends on the accuracy of the data available and may not perfectly precise. In addition, data is also limited since it relies on the secondary sources alone. Lack of Experience and Expertise Since this research is the first research experience for the researcher, undoubtedly there are still lots of things to improve. The lacks of experience especially in data collection and time management have been the limitations to the researcher. Moreover, the researcher has limited knowledge on the topic and needs more understanding on the topic studied. Time Constraint Time is very limited for the researcher to complete the research. The researcher has to be very smart in scheduling the time to make sure the research is completed in time. Thus, time constraint has been identified as one of the limitations for the researcher. 1.7 Significance of the Study This research analyzes on the companies portfolio performance using Sharpe ratio by studying on the differences in the performance between conventional and Islamic Equity Mutual Fund in Malaysia. Therefore this study will provide some information that can be useful because the data and findings from this research will help other researchers to produce better result in their research. This research is also significant to: To Researcher As a finance student, issues in measuring portfolio performance are so much important and crucial. By studying about measurement of portfolio performance in depth, a better understanding and knowledge is gained. This research has given the researcher the opportunity to get the experience in practice as well as in theories. To other researcher This study also can be a useful reference to other researchers who are keen to carry on the study regarding the performance of mutual fund in Malaysia. There are several fruitful areas in this study that can be further examined by other researchers. Further study will give an opportunity to other researchers to expand their view and knowledge. To do so, they need to refer to numerous literatures and hopefully, this research can come in handy for them. To Finance Students This research will be very useful for finance students in having more knowledge about the companys portfolio performance and the differences in the performance between conventional and Islamic Equity Mutual fund in Malaysia. They can use this research as a guide and as references in their studies in portfolio management and mutual fund in Malaysia. To Businesses This research is very important to businesses in realizing the effects of portfolio management on their performance. This is important so that they will have clear direction in deciding their investment. To Investors This study plays an important role in decision making since it gives the investors a prior knowledge of which Equity Mutual Fund companies is the best to invest and whether those companies provide high returns on investment. Moreover, revealing the specific volatility patterns in returns might also benefit investors in risk management and portfolio optimization. This research is also important to investors so that they can have a clearer picture of their investment choices. For investors the study can help them to know the risk and return of their investment transaction. 1.8 Definition of Terms Portfolio A collection of investments are all owned by the same individual or organization. These investments often include stocks, which are investments in individual businesses; bonds, which are investments in debt that are designed to earn interest; and mutual funds, which are essentially pools of money from many investors that are invested by professionals or according to indices. Sharpe Ratio A risk-adjusted measure developed by William F. Sharpe, calculated using standard deviation and excess return to determine reward per unit of risk. The higher the Sharpe ratio, the better the funds historical risk-adjusted performance. Mutual Fund (Unit Trust) A form of collective investment constituted under a trust deed or a pooled investment plan where the capital contributions of investors are combined into a legally formed trust fund. Equity fund Equity fund or stock fund is a fund that invests in Equities more commonly known as stocks. Such funds are typically held either in stock or cash, as opposed to bonds, notes or other securities. Return Based on Investopedia definition, return can be defined as the gain or lossof an investment over a specified period, expressed asa percentage increase over the initial investment cost. Gains on investments are considered to beany income received from the security, plus realized capital gains. Risk The quantifiable likelihood of loss or less-than-expected returns Risk-adjusted return A measure of how much an investment returned in relation to the amount of risk it took on. Often used to compare a high-risk, potentially high-return investment with a low-risk, lower-return investment. Benchmark A standard, used for comparison. For example, the Nasdaq may be used as a benchmark against which the performance of a technology stock is compared. Regression Analysis A statistical technique used to find relationships between variables for the purpose of predicting future values. Coefficient of Determination A measure of the correlation between the dependent and independent variables in a regression analysis. R-squared A measurement of how closely a portfolios performance correlates with the performance of a benchmark index, such as the SP 500, and thus a measurement of what portion of its performance can be explained by the performance of the overall market or index. Values for r-squared range from 0 to 1, where 0 indicates no correlation and 1 indicates perfect correlation. Kuala Lumpur Composite Index (KLCI) The Kuala Lumpur Composite Index (KLCI) is a stock market index generally accepted as the local stock market barometer. KLCI was introduced in 1986 to public the need for a stock market index which would serve as an accurate performance indicator of the Malaysian stock market as well as the economy. It is used to be the main index, and is now one of the three primary indices for the Malaysian stock market which the other two are FMB30 and FMBEMAS, Bursa Malaysia. It contains 100 companies from the Main Board with approximately 500 to 650 listed companies in the Main Board which comprise of multi-sectors companies across the year 2000 to 2006 and is a capitalization-weighted index. 2.0 Literature Review 2.1 Chapter Description Literature review is the documentation of a comprehensive review of the published and unpublished work from the secondary sources of data in the areas of specific interest to the researcher. The reason of the literature review is to ensure that no important variable that has in the past been founded repeatedly to have an impact on the problem is ignored. (Uma Sekaran, 2005 page 63). 2.2 Literature Review of Evaluated Portfolio Performance Craig W. French (2003) discussed on what is involved in evaluating portfolio performance, including the need to adjust for differential risk and differential time periods, the need for a benchmark, and constraints on portfolio managers. It also considered the difference between the portfolios performance and the managers performance. For measurement this paper used well-known risk-adjusted (composite) measures of Sharpe portfolio performance. Investors who had all (or substantially all) of their assets in a portfolio of securities should rely more on the Sharpe measure because total risk is important. Joel Owen and Ramon Rabinovitch (1998), for the last four decades, numerous authors have been suggesting methods to evaluate portfolio performance. Sharpe (1966) proposed performance measures which had produced a score for every portfolio being evaluated. These scores were used to compare the performance of any two portfolios or rank the performance of all portfolios in a given set. The earlier works by Sharpe (1966), Treynor (1965) and Jensen (1968) represented significant contributions to the evaluation of portfolio performance. 2.3 Literature Review of Sharpe Ratio Francisco Peà ±aranda (2007) in her paper commented on developments beyond mean-variance preferences to some alternatives to the Sharpe ratio. The main goal of those measures was to give a similar ranking to Sharpe ratios when returns were symmetrically distributed and showed a preference for skewness when they were not. Moreover, performance measures could be used to guide asset allocation since they can be used as the criterion to maximize with portfolio. Raphie Hayat (2006), the attractiveness of the Sharpe Ratio came from its intuitiveness and simplicity. The Sharpe Ratio are simple because it could rank funds on the base of a single and intuitive since it only rewarded funds with a higher ratio if their returns were higher with the same level of risk or if the risk was lowered while keeping the same level of return. Zhidong Bai, Keyan Wang, and Wing-Keung Wong (2006) stated that the asset performance evaluation was one of the most important areas in investment analysis. In order to compare the performance among assets, several statistics had been developed and among them, the Sharpe-ratio statistic was the most prevalent. However, the major limitation of the Sharpe-ratio statistic was that its distribution is only valid asymptotically, but not valid for small samples. Nevertheless, it was important in finance to test the performance among assets for small samples. Tzu-Wei Kuo and Cesario Mateus (2006), the Sharpe ratio was well known risk-adjusted performance measures and easily understood by an individual investor. Thus, investors could evaluate the exchange-traded funds (ETFs) performance, based on the Sharpe ratio. However, the Sharpe ratio relied on the assumption that returns were normally distributed having these measures difficulty in evaluating the performance with skewed return distributions. Martin Eling and Frank Schuhmacher said that the classic Sharpe ratio was adequate in evaluating investment funds when the returns of those funds were normally distributed and the investor intended to place all his risky assets into just one investment fund. Because hedge fund returns differed significantly from a normal distribution, other performance measures had been proposed and encouraged in both academic and practice-oriented literature. The Sharpe ratio measured the performance of an investment fund by considering the relationship between the risk premium and the standard deviation of the returns generated by a fund. The Sharpe ratio were an adequate performance measure if the returns of the investment funds were normally distributed and the investor wished to place all his risky assets in just one investment fund. Andreas G Merikas, Anna A Merikas and Ioannis Sorros (2005) examined the exact relationship between the Sharpe ratio and the information ratio. Sharpe in 1994 asserted that the information ratio was a generalized Sharpe ratio. Sharpe ratios had been estimated for each fund in each category, and an average ratio for each category. The Sharpe ratio would generally be positive since excess returns of funds over the risk free rate would be positive, unlike excess returns of funds over the market, which could be negative, as the return of the risk free bond was smaller but at the same time less volatile than the return of the market. Cheryl J. Frohlich, Anita Pennathur and Oliver Schnusenberg in their research, Sharpe reward-to-variability ratio was used if total variability was thought to be the appropriate measure of risk, a stocks (portfolios) risk-adjusted returns could be computed using the Sharpe Index. The Sharpe and Treynor Index eliminated the problem of only considering return as a measure of performance. However, neither ratio was independent of the time period over which it is measured. This means that the ratio can change from one period to another with different results. Moreover, both ratios also ignored the correlation of a fund with other assets, liabilities, or previous realizations of its own return. Mario Onorato (2004), the Sharpe Ratio of any investment was defined as its excess return, it is return in excess of a benchmark return divided by the standard deviation of excess return. The benchmark represents a risk free investment alternative. Moreover, although the Sharpe ratio has become part of the modern financial analysis, its applications typically did not account for the fact that it was an estimated quantity, subject to estimation errors that would be substantial in some cases. The statistical properties of Sharpe ratios depended intimately on the statistical properties of the return series on which they are based. This suggests that a more sophisticated approach to interpreting Sharpe ratios is called for, one that incorporates information about the investment style that generates the returns and the market environment in which those returns are generated. Wei Zhen (2004), in his paper said that the Sharpe (1966) and Treynor (1965) performance measures were widely accepted in both academia and industry to assess the Risk-adjusted value of a particular portfolio. It could be shown, after some mathematical treatment, that the Sharpe performance measure was useful when the portfolio of interest represented all of the investors investment, while Treynors measure was preferred when the portfolio under discussion was only a portion of the whole investment package. Robert McCauley and Guorong Jiang (2004), through the Sharpe ratio it compared the returns of portfolios in relation to their risk by dividing their returns in excess of the riskless rate of return by the volatility of their returns. A portfolio with a higher Sharpe ratio was preferred in that it offered a higher return per unit of risk, as measured by return volatility. William Goetzmann, Jonathan Ingersoll, Matthew Spiegel and Ivo Welch (2002), the Sharpe ratio is one of the most common measures of portfolio performance. It was used as a tool for evaluating and predicting the performance of mutual fund managers. Since then the Sharpe ratio, and its close analogues the Information ratio, the squared Sharpe ratio and M-squared, have become widely used in practice to rank investment managers and to evaluate the attractiveness of investment strategies in general. The appeal of the Sharpe measure was clear. It was an affine transformation of a simple t-test for equality in means of two variables, the first variable being the managers time series of returns and the second being a benchmark. The Sharpe ratio was also ubiquitous in academic research as a metric for bounding asset prices. Andrew Worthington and Helen Higgs (2002), the Sharpe ratio (also known as the reward-to-volatility ratio) indicated the excess return per unit of risk and was calculated by dividing the return in excess of the risk-free rate by the standard deviation of returns. In the current context, the Sharpe ratio was the most appropriate performance measure for an investor whose portfolio was composed wholly of a given artists work. Verena Kugi (1999), the Sharpe ratio measured the change in the portfolios return with respect to a one unit change in the portfolios risk. The higher this Reward-to-Variability-Ratio the more attractive was the evaluated portfolio because the investor received more compensation for the same increase in risk. Graphically, the Sharpe ratio was equal to the slope of a straight line connecting the position of the evaluated portfolio, for example a fund, with the risk-free rate. To determine the quality of performance, the Sharpe index of the evaluated portfolio was compared to the Sharpe index of the market or benchmark portfolio. The portfolios Sharpe index being higher than the markets Sharpe index indicated that the portfolio manager had outperformed the market. Respectively, a lower Sharpe ratio was a sign of underperformance. Any portfolio that was positioned on the capital market line had a Sharpe ratio equal to that of the market and was therefore characterized by neutral perform ance. Youguo Liang and Willard McIntosh (1998), the Sharpes alpha captured the excess return of Malaysian Conventional and Islamic Equity Mutual Fund Malaysian Conventional and Islamic Equity Mutual Fund An Analysis Of Companies Portfolio Performance Using Sharpe Ratio: A Study On The Differences Of Performance Between Malaysian Conventional And Islamic Equity Mutual Fund In 2007 1.0 Introduction 1.0.1 Chapter Description In this chapter, explaining the background of the study, problem statement, objectives of the study, hypotheses, significance of this study, as well as the scope and limitations during the process of completing this study. 1.0.2 Background of the Study Portfolio evaluation is on the time before 1960. Investors evaluated portfolio performance almost entirely on the basis of the rate of return. They were aware of the concept of risk but did not know how to quantify or measure it, so they could consider it explicitly. Developments in portfolio theory in the early 1960s showed investors on how to quantify and measure risk in terms of the variability of returns. Still, because no single measure combined both return and risk, the two factors had to be considered separately as researchers such as Friend, Blume, and Crockett (1970). Specifically, the investigators grouped portfolios into similar risk classes based on a measure of risk (such as the variance of return) and compared the rates of return for alternative portfolios directly within these risk classes. Before 1960, investors evaluated portfolio performance almost entirely on the rate of return, although they knew that risk was a very important variable in determining investment success. The reason for omitting risk was the lack of knowledge on how to measure and quantify it. After the development of portfolio theory in early 60s, and CAPM in subsequent years, risk, measured as either by standard deviation or beta, was included in evaluation process. However, since there was not a single measure combining return and risk, two factors were to be considered separately that were researchers grouped portfolios into similar risk classes and compared rates of return of portfolios in the same risk class. There are many kinds of measurement such as Jensen, Treynor and also Sharpe to evaluate the companys portfolio performance. Jensens alpha has been a popular performance measure because it is a return concept. Related to Dr. William F. Sharpes contribution to style analysis of investment performance, the Sharpes alpha is related to the Jensens alpha in the sense that both measures excess returns. They differ, however, in the selection and construction of benchmarks. Sharpe (1966) developed a composite index which was very similar to the Treynor measure, the only difference was that it was being used as standard deviation, instead of beta. To measure the portfolio risk, the researcher needs the average rate of return for Portfolio during a specified time period, the average rate of return on risk-free rate during the same period, Sharpe performance index and the standard deviation of the rate of return for Portfolio during the time period. Sharpe preferred to compare portfolios to the capital market line (CML) rather than the security market line (SML). Sharpe index, therefore, evaluated funds performance based on both rate of return and diversification (Sharpe 1967). For a completely diversified portfolio Treynor and Sharpe indices would give identical rankings. Although the mutual fund industry in Malaysia started as far back as 1959 with the establishment of the Malayan Unit Trust Ltd, the development of the industry did not take-off until the 1980s with the launching of the Amanah Saham Nasional (ASN). In 2004, the Commission approved 17 new Syariah-based unit trust funds, bringing the total number of such funds to 71 or 24.4% of the total 291 approved funds in the industry as at the end of 2004 (2003: 55 funds or 24.3% of the total industry). Of the 71 Syariah-based unit trust funds, 14 were balanced funds, 14 were bond funds, 39 were equity funds, 2 two were fixed income funds and two were money market funds. The number of units in circulation for Syariah-based unit trust funds also increased from 8.59 billion units as at the end of 2003 to 13.16 billion units in 2004. The number of accounts registered an increase of 23.4% or 80,848 accounts, with a total of 427,000 accounts in 2004. One conventional fund made changes to its investment objectives and operations which enabled it to comply with the requirements of Syariah-based unit trust funds. In terms of value, the NAV of Syariah-based unit trust funds grew to RM6.76 billion representing 7.7% of the industry, an increase of 0.9% from the previous year. Over a 10-year period (1995-2004), the NAV of Syariah-based unit trust funds grew at a compounded annual growth rate (CAGR) of 26.18% while the overall industry CAGR was 7.89%. The recognition of the increasing dominance and importance of unit trusts as an investment instrument has spurred researchers to devise appropriate techniques to assess portfolio performance. The earlier works by Sharpe (1966), Treynor (1965) and Jensen (1968) represented significant contributions to the evaluation of portfolio performance. Therefore, the primary aim of this paper is to present new evidences for the analysis of companies portfolio performance using Sharpe ratio by studying the differences the performance between Malaysian conventional and Islamic Equity Mutual Fund in 2007. 1.0.3 Overview of Conventional and Islamic Mutual Fund Mutual fund or better known as unit trust in Malaysia is an investment vehicle created by asset management companies specializing in pooling savings from both retail and institutional investors. Individual investors seeking liquidity, portfolio diversification and investment expertise are increasingly choosing unit trust funds as their investment vehicle. However, these investors do differ in their preferences based on their risk threshold, liquidity needs and their needs to comply with religious requirement. In the Malaysian context, the performance of mutual funds or more popularly known as unit trust funds as reported by Shamsher and Annuar (1995), Tan (1995), Leong and Aw (1997), Annuar et al,. (1997) and Low and Noor A. Ghazali (2005) concluded that on average, funds were unable to beat the market. The number of unit trust has grown dramatically in recent years. Unit trusts are now the preferred way for individual investors and many institutions to participate in the capital markets, and their popularity has increased demand for evaluations of fund performance. Muslims are not allowed to invest in standard mutual funds since their religion prohibits them from investing in certain equities, like those of banks or companies that deal in pork, alcohol, pornography and certain entertainment related products. An Islamic mutual fund is similar to a â€Å"conventional† mutual fund in many ways; however, unlike its â€Å"conventional† counterpart, an Islamic mutual fund must conform to the Sharia (Islamic Law) investment precepts. The Sharia encourages the use of profit sharing and partnership schemes, and forbids riba (interest), maysir (gambling and pure games of chance), and gharar (selling something that is not owned or that cannot be described in accurate detail; i.e., in terms of type, size and amount) (El-Gamal 2000). The Sharia guidelines and principles govern several aspects of an Islamic mutual fund, including its asset allocation (portfolio screening), investment and trading practices, and income distribution (purification). When selecting investments for their portfolio (asset allocation), conventional mutual funds can freely choose between debt-bearing investments and profit-bearing investment, and invest across the spectrum of all available industries. An Islamic mutual fund, however, must set up screens in order to select those companies that meet its qualitative and quantitative criteria set by Sharia guidelines. 1.1 Problem Statement At some levels, people are always interested in evaluating the performance of their investments. Having to spend the time and incurred the expense to design an asset allocation strategy and select the specific set of securities to form their portfolios, investors whether they are individuals, corporations, or financial institutions. It must be periodically determined whether this effort is worthwhile. Investors in managing their own portfolios should evaluate their performance, as should those who pay one or several professional money managers to make these decisions for them. It is imperative to determine the realized investment performance which justifies the additional costs of engaging professional management. Comparing a portfolios historical returns to those produced by other managers or indexes can be instructive; such comparisons do not produce a complete picture of the portfolios performance. Indeed, the central tenet of the modern approach to performance measurement is that it is impossible to make a thorough evaluation of an investment without explicitly control the risk of the portfolio. Given the complexity and importance of the issues involved, it is not a surprise to learn that there is not a single universally accepted procedure for risk-adjusting portfolio returns. Nevertheless, there are several techniques that are commonly employed. Some previous studies found results that are inconsistent with Chuas findings. These studies include Ewe (1994), Shamsher and Annuar (1995), and Tan (1995). Shamsher and Annuar (1995), focused their study on the performance of 54 unit trusts covering the period of late 80s to early 90s. They found out that the returns on investment in unit trust were well below the risk free and market returns. Furthermore, the results indicated that not only the degree of portfolios diversification was below expectation but the actual returns and risk characteristics of funds were also inconsistent with their stated objectives. Tan (1995) analyzed performance of 12 unit trusts over a 10-year period, 1984-1993. He concluded that unit trusts in general perform worse than the market portfolio. Consistent with Chuas findings, Tan also concluded that government sponsored funds performed better than private funds. As we can see, there are three portfolio performance evaluation techniques that comprise the basic ‘toolkit for measuring risk-adjusted performance. Although some redundancy exists among these measures, each of them provides unique perspectives, so that best viewed as complementary measures. In particular, examining the controversy surrounding the selection of the proper benchmark to use in the risk-adjustment process and discussing why these benchmark problems become larger when beginning to invest globally. From here, how to evaluate the performance of the investments in order to reduce the risk taken? What measurement can contribute to evaluating a good investment? Therefore, it is interesting to analyze the companies portfolio performance by studying on the differences in the performance between conventional and Islamic equity mutual fund in Malaysia by using Sharpe ratio. 1.2 Objectives of Research The general purpose of this study is to analyze the companies portfolio performance using Sharpe ratio by studying on the differences in the performance between conventional and Islamic equity mutual fund in Malaysia. A careful review on those questions has led to the development of the following specific research objectives which are: i. To measure and rank both relative quantitative performances of mutual fund (conventional/Islamic) on the basis of their return, total risk, coefficient of variation and Sharpe ratio. The term performance contains both the return and the risk undertaken by these mutual funds. ii. To investigate whether both mutual funds (conventional/Islamic) are earning higher returns than the benchmark returns (or market Portfolio/Index returns) in terms of risk. iii. To determine the relationship between dependent variable and independent variable. 1.3 Scope of Study The study is on the analysis of the companies portfolio performance in determining the measure of average daily return, total risk (standard deviation), coefficient of variation and Sharpe ratio. Moreover, to observe the differences in terms of performance between conventional and Islamic mutual fund in the context of Malaysian capital market by comparing them to the stock market index or Kuala Lumpur Composite Index (KLCI) benchmark. The scopes of the study are stated as follow:  § The relationship between two variables: the return on equity mutual fund as the dependent variable whereas the return on stock market index (KLCI) as the independent variable for conventional and Islamic fund.  § The period of study will cover one (1) year starting from January 2007 to December 2007 using the daily basis collected from The Star and New Straits Times newspapers and also from the internet.  § This research will also focus on the conventional and Islamic Equity Mutual Fund companies available in Malaysia. 1.4 Theoretical Framework The theoretical framework shows the relationship between the independent variables and dependent variable. The independent variable is the return on KLCI while the dependent variable is the return of Equity Mutual fund companies in Malaysia. Schematic diagram for the theoretical framework in this study is as follows: Market Index Equity Fund Market Index Islamic Equity Fund Independent Variable Dependent Variable 1.5 Hypotheses According to Uma Sekaran (2003), a hypothesis can be defined as a logically conjectured relationship between two or more variables expressed in the form of testable statement. Hypothesis can be divided into two categories which are Ho which is a Null Hypothesis and Ha which is an Alternate Hypothesis. The term â€Å"null† can be thought of as meaning â€Å"no change† or â€Å"no difference†. The second hypothesis is called alternative hypothesis. It is summary of the case if the null hypothesis is not true. It is stated that Ha, the alternative hypothesis is a statement of a view that has been prepared to be accepted if Ho is rejected. The hypotheses of this study are: Hypothesis 1: Ho: There is no relationship between the return on KLCI and the return on Conventional equity mutual fund. Ha: There is a relationship between the return on KLCI and the return on Conventional equity mutual fund. Hypothesis 2: Ho: There is no relationship between the return on KLCI and the return on Islamic equity mutual fund. Ha: There is a relationship between the return on KLCI and the return on Islamic equity mutual fund. 1.6 Limitations of the Study Data Collection and Cost Limitation The major source of data gained is from the secondary sources. The data is only available at certain places and it requires cost to obtain the data. Besides, it also requires costs in the process of printing, photocopying, data services and transportations to obtain the information. The information about the topic studied is also difficult to search in the library because of the limited information. As a result, it causes problems to the researcher to gather and collect the information. The information and data related to the study is rather difficult to obtain. Thus, the accuracy of the study depends on the accuracy of the data available and may not perfectly precise. In addition, data is also limited since it relies on the secondary sources alone. Lack of Experience and Expertise Since this research is the first research experience for the researcher, undoubtedly there are still lots of things to improve. The lacks of experience especially in data collection and time management have been the limitations to the researcher. Moreover, the researcher has limited knowledge on the topic and needs more understanding on the topic studied. Time Constraint Time is very limited for the researcher to complete the research. The researcher has to be very smart in scheduling the time to make sure the research is completed in time. Thus, time constraint has been identified as one of the limitations for the researcher. 1.7 Significance of the Study This research analyzes on the companies portfolio performance using Sharpe ratio by studying on the differences in the performance between conventional and Islamic Equity Mutual Fund in Malaysia. Therefore this study will provide some information that can be useful because the data and findings from this research will help other researchers to produce better result in their research. This research is also significant to: To Researcher As a finance student, issues in measuring portfolio performance are so much important and crucial. By studying about measurement of portfolio performance in depth, a better understanding and knowledge is gained. This research has given the researcher the opportunity to get the experience in practice as well as in theories. To other researcher This study also can be a useful reference to other researchers who are keen to carry on the study regarding the performance of mutual fund in Malaysia. There are several fruitful areas in this study that can be further examined by other researchers. Further study will give an opportunity to other researchers to expand their view and knowledge. To do so, they need to refer to numerous literatures and hopefully, this research can come in handy for them. To Finance Students This research will be very useful for finance students in having more knowledge about the companys portfolio performance and the differences in the performance between conventional and Islamic Equity Mutual fund in Malaysia. They can use this research as a guide and as references in their studies in portfolio management and mutual fund in Malaysia. To Businesses This research is very important to businesses in realizing the effects of portfolio management on their performance. This is important so that they will have clear direction in deciding their investment. To Investors This study plays an important role in decision making since it gives the investors a prior knowledge of which Equity Mutual Fund companies is the best to invest and whether those companies provide high returns on investment. Moreover, revealing the specific volatility patterns in returns might also benefit investors in risk management and portfolio optimization. This research is also important to investors so that they can have a clearer picture of their investment choices. For investors the study can help them to know the risk and return of their investment transaction. 1.8 Definition of Terms Portfolio A collection of investments are all owned by the same individual or organization. These investments often include stocks, which are investments in individual businesses; bonds, which are investments in debt that are designed to earn interest; and mutual funds, which are essentially pools of money from many investors that are invested by professionals or according to indices. Sharpe Ratio A risk-adjusted measure developed by William F. Sharpe, calculated using standard deviation and excess return to determine reward per unit of risk. The higher the Sharpe ratio, the better the funds historical risk-adjusted performance. Mutual Fund (Unit Trust) A form of collective investment constituted under a trust deed or a pooled investment plan where the capital contributions of investors are combined into a legally formed trust fund. Equity fund Equity fund or stock fund is a fund that invests in Equities more commonly known as stocks. Such funds are typically held either in stock or cash, as opposed to bonds, notes or other securities. Return Based on Investopedia definition, return can be defined as the gain or lossof an investment over a specified period, expressed asa percentage increase over the initial investment cost. Gains on investments are considered to beany income received from the security, plus realized capital gains. Risk The quantifiable likelihood of loss or less-than-expected returns Risk-adjusted return A measure of how much an investment returned in relation to the amount of risk it took on. Often used to compare a high-risk, potentially high-return investment with a low-risk, lower-return investment. Benchmark A standard, used for comparison. For example, the Nasdaq may be used as a benchmark against which the performance of a technology stock is compared. Regression Analysis A statistical technique used to find relationships between variables for the purpose of predicting future values. Coefficient of Determination A measure of the correlation between the dependent and independent variables in a regression analysis. R-squared A measurement of how closely a portfolios performance correlates with the performance of a benchmark index, such as the SP 500, and thus a measurement of what portion of its performance can be explained by the performance of the overall market or index. Values for r-squared range from 0 to 1, where 0 indicates no correlation and 1 indicates perfect correlation. Kuala Lumpur Composite Index (KLCI) The Kuala Lumpur Composite Index (KLCI) is a stock market index generally accepted as the local stock market barometer. KLCI was introduced in 1986 to public the need for a stock market index which would serve as an accurate performance indicator of the Malaysian stock market as well as the economy. It is used to be the main index, and is now one of the three primary indices for the Malaysian stock market which the other two are FMB30 and FMBEMAS, Bursa Malaysia. It contains 100 companies from the Main Board with approximately 500 to 650 listed companies in the Main Board which comprise of multi-sectors companies across the year 2000 to 2006 and is a capitalization-weighted index. 2.0 Literature Review 2.1 Chapter Description Literature review is the documentation of a comprehensive review of the published and unpublished work from the secondary sources of data in the areas of specific interest to the researcher. The reason of the literature review is to ensure that no important variable that has in the past been founded repeatedly to have an impact on the problem is ignored. (Uma Sekaran, 2005 page 63). 2.2 Literature Review of Evaluated Portfolio Performance Craig W. French (2003) discussed on what is involved in evaluating portfolio performance, including the need to adjust for differential risk and differential time periods, the need for a benchmark, and constraints on portfolio managers. It also considered the difference between the portfolios performance and the managers performance. For measurement this paper used well-known risk-adjusted (composite) measures of Sharpe portfolio performance. Investors who had all (or substantially all) of their assets in a portfolio of securities should rely more on the Sharpe measure because total risk is important. Joel Owen and Ramon Rabinovitch (1998), for the last four decades, numerous authors have been suggesting methods to evaluate portfolio performance. Sharpe (1966) proposed performance measures which had produced a score for every portfolio being evaluated. These scores were used to compare the performance of any two portfolios or rank the performance of all portfolios in a given set. The earlier works by Sharpe (1966), Treynor (1965) and Jensen (1968) represented significant contributions to the evaluation of portfolio performance. 2.3 Literature Review of Sharpe Ratio Francisco Peà ±aranda (2007) in her paper commented on developments beyond mean-variance preferences to some alternatives to the Sharpe ratio. The main goal of those measures was to give a similar ranking to Sharpe ratios when returns were symmetrically distributed and showed a preference for skewness when they were not. Moreover, performance measures could be used to guide asset allocation since they can be used as the criterion to maximize with portfolio. Raphie Hayat (2006), the attractiveness of the Sharpe Ratio came from its intuitiveness and simplicity. The Sharpe Ratio are simple because it could rank funds on the base of a single and intuitive since it only rewarded funds with a higher ratio if their returns were higher with the same level of risk or if the risk was lowered while keeping the same level of return. Zhidong Bai, Keyan Wang, and Wing-Keung Wong (2006) stated that the asset performance evaluation was one of the most important areas in investment analysis. In order to compare the performance among assets, several statistics had been developed and among them, the Sharpe-ratio statistic was the most prevalent. However, the major limitation of the Sharpe-ratio statistic was that its distribution is only valid asymptotically, but not valid for small samples. Nevertheless, it was important in finance to test the performance among assets for small samples. Tzu-Wei Kuo and Cesario Mateus (2006), the Sharpe ratio was well known risk-adjusted performance measures and easily understood by an individual investor. Thus, investors could evaluate the exchange-traded funds (ETFs) performance, based on the Sharpe ratio. However, the Sharpe ratio relied on the assumption that returns were normally distributed having these measures difficulty in evaluating the performance with skewed return distributions. Martin Eling and Frank Schuhmacher said that the classic Sharpe ratio was adequate in evaluating investment funds when the returns of those funds were normally distributed and the investor intended to place all his risky assets into just one investment fund. Because hedge fund returns differed significantly from a normal distribution, other performance measures had been proposed and encouraged in both academic and practice-oriented literature. The Sharpe ratio measured the performance of an investment fund by considering the relationship between the risk premium and the standard deviation of the returns generated by a fund. The Sharpe ratio were an adequate performance measure if the returns of the investment funds were normally distributed and the investor wished to place all his risky assets in just one investment fund. Andreas G Merikas, Anna A Merikas and Ioannis Sorros (2005) examined the exact relationship between the Sharpe ratio and the information ratio. Sharpe in 1994 asserted that the information ratio was a generalized Sharpe ratio. Sharpe ratios had been estimated for each fund in each category, and an average ratio for each category. The Sharpe ratio would generally be positive since excess returns of funds over the risk free rate would be positive, unlike excess returns of funds over the market, which could be negative, as the return of the risk free bond was smaller but at the same time less volatile than the return of the market. Cheryl J. Frohlich, Anita Pennathur and Oliver Schnusenberg in their research, Sharpe reward-to-variability ratio was used if total variability was thought to be the appropriate measure of risk, a stocks (portfolios) risk-adjusted returns could be computed using the Sharpe Index. The Sharpe and Treynor Index eliminated the problem of only considering return as a measure of performance. However, neither ratio was independent of the time period over which it is measured. This means that the ratio can change from one period to another with different results. Moreover, both ratios also ignored the correlation of a fund with other assets, liabilities, or previous realizations of its own return. Mario Onorato (2004), the Sharpe Ratio of any investment was defined as its excess return, it is return in excess of a benchmark return divided by the standard deviation of excess return. The benchmark represents a risk free investment alternative. Moreover, although the Sharpe ratio has become part of the modern financial analysis, its applications typically did not account for the fact that it was an estimated quantity, subject to estimation errors that would be substantial in some cases. The statistical properties of Sharpe ratios depended intimately on the statistical properties of the return series on which they are based. This suggests that a more sophisticated approach to interpreting Sharpe ratios is called for, one that incorporates information about the investment style that generates the returns and the market environment in which those returns are generated. Wei Zhen (2004), in his paper said that the Sharpe (1966) and Treynor (1965) performance measures were widely accepted in both academia and industry to assess the Risk-adjusted value of a particular portfolio. It could be shown, after some mathematical treatment, that the Sharpe performance measure was useful when the portfolio of interest represented all of the investors investment, while Treynors measure was preferred when the portfolio under discussion was only a portion of the whole investment package. Robert McCauley and Guorong Jiang (2004), through the Sharpe ratio it compared the returns of portfolios in relation to their risk by dividing their returns in excess of the riskless rate of return by the volatility of their returns. A portfolio with a higher Sharpe ratio was preferred in that it offered a higher return per unit of risk, as measured by return volatility. William Goetzmann, Jonathan Ingersoll, Matthew Spiegel and Ivo Welch (2002), the Sharpe ratio is one of the most common measures of portfolio performance. It was used as a tool for evaluating and predicting the performance of mutual fund managers. Since then the Sharpe ratio, and its close analogues the Information ratio, the squared Sharpe ratio and M-squared, have become widely used in practice to rank investment managers and to evaluate the attractiveness of investment strategies in general. The appeal of the Sharpe measure was clear. It was an affine transformation of a simple t-test for equality in means of two variables, the first variable being the managers time series of returns and the second being a benchmark. The Sharpe ratio was also ubiquitous in academic research as a metric for bounding asset prices. Andrew Worthington and Helen Higgs (2002), the Sharpe ratio (also known as the reward-to-volatility ratio) indicated the excess return per unit of risk and was calculated by dividing the return in excess of the risk-free rate by the standard deviation of returns. In the current context, the Sharpe ratio was the most appropriate performance measure for an investor whose portfolio was composed wholly of a given artists work. Verena Kugi (1999), the Sharpe ratio measured the change in the portfolios return with respect to a one unit change in the portfolios risk. The higher this Reward-to-Variability-Ratio the more attractive was the evaluated portfolio because the investor received more compensation for the same increase in risk. Graphically, the Sharpe ratio was equal to the slope of a straight line connecting the position of the evaluated portfolio, for example a fund, with the risk-free rate. To determine the quality of performance, the Sharpe index of the evaluated portfolio was compared to the Sharpe index of the market or benchmark portfolio. The portfolios Sharpe index being higher than the markets Sharpe index indicated that the portfolio manager had outperformed the market. Respectively, a lower Sharpe ratio was a sign of underperformance. Any portfolio that was positioned on the capital market line had a Sharpe ratio equal to that of the market and was therefore characterized by neutral perform ance. Youguo Liang and Willard McIntosh (1998), the Sharpes alpha captured the excess return of

The Manicure - A Psycho-social Experience Essay -- Exploratory Essays

The Manicure - A Psycho-social Experience There’s nothing like Strawberry Champagne or Park Avenue Orchids to let the world know that you want to have fun. Peppermint and Funshine Pink exude youthful innocence while Chinese Red is downright sexy. Black Cherry adds a bit of serious sophistication to an already irresistible demeanor. And for those more mellow moods, Grand Canyon Sunset and Beach Blanket Mauve are sure to have a soothing impact. It’s true. Nail color can mirror the inner feelings and emotions of the person wearing it. In fact, there is an entire psychological dimension to nails—mental health being a primary reason why people get manicures. Few people will admit to getting their nails done solely for hygienic purposes. My purpose for getting my nails done is two-fold. Getting a manicure once a month keeps my nails healthy and gives my hands a softer and cleaner look, even when my nails are not polished. Besides that, though, it’s a relaxing and fun gift I give to myself. I figure that if I don’t spend $15.00 a month on myself, who will? People are constantly telling me that getting a manicure is a waste of time and money and that I could do my nails myself and donate to charity the money I â€Å"waste† each month. I’ll give twice as much money to charity, but I refuse to give up this precious monthly ritual. I am not the only one guilty of indulging in this ritual. Along with my fellow â€Å"manicurees,† I have made a personal investment in a billion-dollar business that has swept the U.S. in recent years. Each day, this growing sector of the personal service industry is responsible for making dozens of hands and people look and feel simply divine. The practice of nail co... ...o me. My nails looked fine; in fact, they looked great. But that wasn’t the point. The point was I didn’t feel relaxed, pampered, special, and great—like I usually did after a manicure. Manicures are all about looking great and feeling great. Base coat is not essential, and having your arms massaged is truly a luxury one can do without. Manicurists are paid to give their client a manicure, but in addition to the manicure the client receives an experience which provides an opportunity to relax, gossip, tell someone her problems, or do whatever she feels like doing. Red tips at the Indus Valley, polishing powder in Paris, liquid nail polish in New York, Fire and Ice across America, and nail salons in suburban towns all have one thing in common. They are all about doing something extra for yourself. Great looking nails aren’t a necessity; they’re a luxury.

My writing ritual

The writing process Is new to me since Vie been out of school for 2 plus years. I am a new writer thus I am learning new writing techniques that produces a more unique personalized writing for me. The new technique I have learned Is writing rituals which are a detailed act or series of acts carried out by an Individual to relieve anxiety or to forestall the development of anxiety. Also (psycho) any repetitive behavior, such as hand-washing, performed by a person with a compulsive personality disorder.These steps will explain its self and it'll show how it can also be plied to your everyday life. The rituals I use help to relieve stress when writing and is very important doing so. Although the steps I take are very tedious and well- structured, I put myself in a mind to produce well papers that represent not only me as a student but as a creative mouth piece generating an art. In order to succeed with a well-grounded paper I use these steps that I will explain in detail in following p ages. Introduction As for me to begin my process to write, I prepare my mind, body, and soul.Whether, for homework, a speech, guidelines, or announcements, I have to prepare yeses or I won't be able to focus and be easily distracted. I've noticed my preparations have made my writing extremely successful. These steps will explain it and it'll show how it can also be applied to your everyday life. Step by Step Beginning my days at 6 A. M. Get dressed, brush my teeth and wash my face. Then, I go downstairs to make coffee. I like everything to be clean and organized so I clean the kitchen, put all the clean dishes away (from the day before) and fix the couch.I make my coffee and go back upstairs. I play Soft Charlatans music to set the atmosphere. So I'm not so tense while I'm writing, I use the yoga ball to stretch my muscles. Then, I set up my computer, take out my notes that Ill need, and look at the assignments that are due. If I get overwhelmed, I like to go for a walk and think ab out the assignment. I ask myself how I can complete it successfully, have I ever done this type of assignment before, and can it be applied to reality? I also do research to further my understanding and to make sure I have the right ideas for the assignment.Before I get started, I like to get a cold glass of water, some fruit, rackets, or peanuts so I wont lose my focus. Think of this as food for thought! And these are my steps to succeed. With the writing rituals I listed above show what I use to create assignments and how important they are to me producing a well-organized paper. I like to succeed; I take my education very seriously so this exercise has shown me that I'm going down the right path. During this course, Vie learned in order to succeed; I have to take extra steps to accomplish my goals. I think this course has helped me improve in all aspects of my life.

Future of the Music Industry Essay Example

Future of the Music Industry Essay Example Future of the Music Industry Essay Future of the Music Industry Essay Future of the Music Industry It seems as though the first era of digital music may have come to an end. Napster died, P2P lived in some black market twilight zone, streaming services on ad-supported revenue were suffocated by unsustainably high licensing fees, and subscription services sputtered along, never quite capturing the imaginations of music fans. 2009 ended in a flurry of acquisitions (LaLa, iLike (Ilike)), launches (Vevo) and shutdowns (iMeem (imeem)), which dramatically rearranged the digital music landscape. When the dust finally settles, expect digital music to begin anew. With that in mind, here are my five predictions for music in the next 12 months. 1. Labels Will Get Smart It’s been coming for more than a decade, but major labels are starting to grasp the digital opportunity. They’re licensing music on more sustainable terms, diversifying their business model, investing in new technology and, most critically, understanding more than ever what it means to be truly consumer-led. As market leaders, major labels have the resources and the networks to profit most from the changes currently taking place. The move from physical to digital hasn’t been as fast as many people might have wished, but that’s because digital still doesn’t pay like physical does. CDs, when they sell well, still mean big money. Digital isn’t like that. But that’s changing, and as major labels have shrunk, their capacity for change has increased. Expect 2011 to be the year that the bad press on the major labels starts becoming more favorable. : The promises of the digital age, with a deeper understanding of the music consumer, integrated ticketing and merchandise, direct-to-consumer sales, and fans as marketing teams, are all about to become a reality, and major labels will lead the charge. 2. Physical CD Sales Will Continue to Decline To ensure at least one of my predictions comes true, I’m going to forecast that globally, sales of physical CDs will decline substantially by 2011. That’s one thing you can definitely count on. 3. Release Strategies Will Evolve The traditional model of building buzz through radio singles followed by a carefully timed album launch will still be the norm for commercial pop music. But at the edges, we’re going to start seeing a new model for releasing music that’s more attuned to the diverse community of music consumers. The new model, pioneered by Topspin Media, will be the multi-tiered, staggered release. Artists will offer free, full streams and selected downloads early to the curious and the devoted, building their fan-base as they grow. Traditional release schedules will follow, in tandem with more innovative products, at more diverse prices, to more accurately segmented groups of fans. Rather than just a plastic CD, we’ll start seeing multiple tiers of music product: free streams and low quality mp3s, simple digital and physical packages, enhanced audio and packaging on digital and physical releases, and then levels of premium products including vinyl, merchandise, and increased access to the artist. We still think of music in its physical form as a CD on the shelf. Increasingly, we’re going to understand it as a suite of music products, for example: T-Shirts, mugs, books, framed art, signed lyric sheets, USBs, and once-in-a-lifetime music experiences. 4. Music Will Live Legitimately in the Cloud It’s been talked about for a number of years now, but by 2012 we will start thinking of music less as a finite product and more as an infinite, on-demand reservoir to be accessed at any time for a fee. This process will roll out in tandem with the evolution of music â€Å"products. Even if music is universally accessible, it’s still key to people’s idenity. We still need something to put on a coffee table, something to pass to friends, something to put under the Christmas tree and something to signal to the world that â€Å"this music is part of me and I want you to know it. † iTunes, as ever, is in the driver’s seat to make the most of this change. Its acquisition of LaLa could see them own the streaming marke t as it currently owns digital music. Spotify’s buzz seems to have cooled, but it’s still the best-placed streaming service to take advantage of the cloud’s potential. Grooveshark’s growth, if it continues, is going to make it a serious player in the streaming game. MySpace (MySpace), with iMeem and iLike in its back pocket may also consolidate its place in the land of the streaming. And finally, Google (Google) –- who owns the bridge over the moat, digitally speaking –- could pull the rug from everyone and facilitate properly integrated music streaming into its search platform. Whoever emerges at the front of this pack will be in new territory, providing access to the world’s music, anytime, anywhere on any device. 5. Who Really Knows? There’s some as-yet untested consumer models building momentum. For example: Guvera is promising the world, not just to the music industry, but to advertisers as well. Whether consumers buy into its advertisement for content exchange remains to be seen. Rdio, with serious pedigree and some big money backing it, hasn’t poked its head up completely yet, but you can be assured that whatever it offers isn’t going to be lightweight. Lost in all the buzz is the fact that some legacy digital music companies - Last. FM (Last. fm), Pandora (Pandora) and MySpace to name a few - still have the established brands, the existing customer base, and the revenue streams that preserve their lives beyond the froth of the tech/music blogosphere. And of course, there’s Facebook (Facebook). The biggest virtual country in the world, Facebook and music have always been awkward bedfellows. If Zuckerberg and Co. an figure a way to integrate music with the Facebook platform, the existing user base would guarantee a big chunk of the market overnight. In conclusion, it all adds up to create a big void of uncertainty, one that will be filled in the way the web knows best - by its end-users. What those end-users decide they love will ultimately determine the winners and losers in the digital music economy. As a passionate music fan, I can’t wait for the competition to heat up. For those on the digital frontier, music rea lly is better than it’s ever been.

Managing People at Heinz Company

Managing People at Heinz Company Introduction H.J Heinz Company is a well-established firm that operates in the US food industry. The firm has attained global market recognition due to its comprehensive internationalisation strategy. The firm is renowned for its nutritious and delicious convenient food products (Heinz 2015).Advertising We will write a custom proposal sample on Managing People at Heinz Company specifically for you for only $16.05 $11/page Learn More Despite its past market success, Heinz is focused on optimising its economic sustainability through formulation and implementation of effective corporate level strategies. One of the corporate level strategies that the firm has integrated in its strategic management entails the formation of merger and acquisition (Market Watch 2015). On 25th March 2015, Heinz announced its ambitious plan to merge with Kraft Foods, a US-based food company. The merger agreement will lead to the establishment of a new entity, which will operate unde r the name â€Å"The Kraft Heinz Company†. Heinz will have control of the new entity (DiChristopher 2015). Heinz shareholders will have a 51% stake in the new entity. The new firm will become the third largest food enterprise in North America. It is expected that the merger will increase the sales revenue of the two firms to $28 billion (Market Watch 2015). Problem statement Over the past decades, a number of merger and acquisition failures have been experienced due to ineffective post-acquisition integration processes (Lakhman 2011). One of the reasons for the failure is the lack of or poor adoption of strategic organisational management practices. The Heinz-Kraft merger is not shielded from failure. Despite this aspect, undertaking the intended merger between the two firms will present a major challenge to Heinz management team due to the complex issues associated with mergers and acquisitions. First, some employees might perceive the merger as a threat to their job. Moreov er, the two firms are characterised by distinct organisational culture, which they have developed over the years.Advertising Looking for proposal on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More The lack of or poor management of the existing organisational culture differences can lead to the failure of the merger. This aspect underscores the importance of integrating effective strategic human resource management practices in order to deal with possible culture shock and employee resistance. One of the critical strategic management issues that Heinz management team should consider in its quest to implement the merger is effective people management. Failure to take into account the two issues will increase the risk of failure (Holbeche 2007). Research objective The purpose of this research is to evaluate how H.J Heinz Company can successfully undertake the intended merger with Kraft Foods by appreciating the con cepts of employee involvement and engagement during its merger process. This move will culminate in the attainment of effective post-merger integration. Research question The research study will be based on the following research question. In what ways can Heinz Company adopt people management as one of the strategic management practices in its quest to foster organisational performance? Literature review Culture is one of the fundamental aspects in the existence of organisations (Schmitz 2009). Gill (2002) argues that can lead to a reduction in an organisation’s cost of operation through effective coordination of the employees’ efforts. Consequently, it can translate into attainment of a higher competitive advantage. However, most organisations do not appreciate the importance of culture in the course of implementing diverse change initiatives. A study involving over 100 senior organisational executives engaged in 700 merger and acquisition deals between 1996 and 19 98 revealed that 83% of the MA’s did not attain the desired outcome (KPMG 2000).Advertising We will write a custom proposal sample on Managing People at Heinz Company specifically for you for only $16.05 $11/page Learn More On the contrary, the MA initiatives led to the destruction of organisational value (Gill 2012). Gill (2002) further argues that the failure emanated from the existence of poor people and cultural management practices. The strong correlation between people and culture management to organisational performance underscores the importance of incorporating effective HRM practices (Holbeche 2007). Vazirani (2012) cites a number of factors that contribute to the failures of mergers and acquisitions. According to Vazirani (2012), imitation of the merger and integration strategy has greatly contributed to MA failure. This aspect underscores the existence of a gap in organisations’ commitment to formulate and adopt unique people manag ement strategies. Moreover, failures in mergers and acquisitions also arise from the adoption of ineffective leadership practices. According to Kiessling and Harvey (2006), most organisations do not adopt a knowledge-based view in their people management practices. Privately held knowledge comprises a fundamental source of an organisation’s competitive advantage. Thus, employees are fundamental intangible organisational resources. However, the capacity to tap into the tacit knowledge held by the employees is only possible if effective employee involvement and engagement strategies are adopted. This goal can be achieved by integrating the cultural orientation model, which is concerned with understanding the individuals’ cultural dimensions (Sparrow 2009).Advertising Looking for proposal on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Moreover, the extent to which organisational manager understands the employees’ appreciation of the organisational culture is subject to the type of leadership style. According to Cummings and Worley (2014), employee involvement is aimed at increasing the employees’ input in the decision-making process. Employee involvement culminates in the attainment of high organisational performance while at the same time taking into consideration the employees’ wellbeing. Cummings and Worley (2014) further contend that employee involvement increases the employees’ level of motivation and hence their productivity. Thus, ignoring employees during major organisational change initiatives may be counterproductive due to increased resistance to the intended transformation, which in extreme situations might culminate in turnover intentions (Galpin, Whittington Maellaro 2012). Thus, an organisation may experience loss of key talent hence hindering the attainment of the proj ected outcome. In a bid to promote effective employee involvement, organisational managers should integrate the path-goal theory. According to Griffin and Moorhead (2014, p.337), subordinates are ‘motivated by their leader to the extent that the behaviours of that leader influence their expectancies’. Methodology The study will be conducted by integrating the literature survey design. Consequently, the study will obtain data and information on the concept of employee involvement and engagement from credible sources such as peer-reviewed journals, books and reports conducted by credible institutions. However, the study will only evaluate past studies on change initiatives by different organisations. The choice of the aforementioned source of data will ensure that the data obtained is credible hence providing insight to Heinz Company’s management team on how to implement the two concepts in its merger and acquisition process. The data collected will be analysed qua litatively in order gain in-depth understanding of the importance of employee involvement and engagement during merger initiatives. Conclusion Contemporary business organisations are operating in an environment that has progressively become turbulent. Thus, their long-term sustainability depends on the efficacy of their strategic management practices. One of the issues that businesses will continue to face relates to change. The change may be either intentional or unintentional. Irrespective of the nature of change, it is imperative for organisational leaders to integrate effective change management practices. In its quest to undertake the intended merger and acquisition, it is imperative for Heinz Company to adopt effective strategic management practices. One of the areas that the organisations’ management team should focus on entails effective strategic human resource management practices. One of the most pertinent SHRM issues that organisational leaders should take into co nsiderations entails employee involvement and engagement. The study’s findings will provide Heinz Company management team a better understanding of how to undertake employee involvement and engagement in the MA process. Reference List Cummings, T Worley, C 2014, Organisation development and change, Cengage Learning, New York. DiChristopher, T 2015, Buffett’s HJ Heinz to merge with Kraft Foods, cnbc.com/id/102533153 Gill, C 2012, ‘The role of leadership in successful international mergers and acquisition; why Renault-Nissan succeeded and Daimlerchrysler- Mitsubishi failed’, Human Resource Management, vol. 51, no. 3, pp. 433-456.a Griffin, R Moorhead, G 2014, Organisational behaviour; managing people and organisations, South-Western Cengage Learning, Mason. Heinz: Welcome to our home 2015, heinz.com/our-company.aspx Holbeche, L 2007, Understanding change, Routledge, New York. Kiessling, T Harvey, M 2006, ‘The human resource management issues during an acquisition; the target firm’s top management team and key managers’, International Journal of Human Resource Management, vol. 17, no. 7, pp. 1307-1320. KPMG: Unlocking shareholder value; the keys to success 2000, http://people.stern.nyu.edu/adamodar/pdfiles/eqnotes/KPMGMA.pdf Lakhman, C 2011, ‘Post acquisition cultural integration in mergers and acquisitions; a knowledge based approach’, Human Resource Management, vol. 50, no. 5, pp. 605-623. Market Watch: H.J Heinz Company and Kraft Foods Group sign definitive merger agreement to form the Kraft Heinz Company 2015, marketwatch.com/story/hj-heinz-company-and-kraft-foods-group-sign-definitive-merger-agreement-to-form-the-kraft-heinz-company-2015-03-25 Schmitz, J 2009, Understanding the cultural orientation approach; an overview of the development and updates to the COA, viewed on culturalorientations.com/SiteData/docs/ArticleUnd/616d3a22b5d5d472/Article%20%20Understanding%20the%20Cultural%20Orientations %20Approach.12.06.2012.pdf Sparrow, P 2009, Handbook of international human resource management; integrating people, process and context, John Wiley, Chichester. Vazirani, N 2012, ‘Mergers and acquisitions performance evaluation; a literature review’, Journal of Management, vol. 8, no. 2, pp. 37-42.