DO ISLAMIC CRYPTOCURRENCIES PROVIDE DIVERSIFICATION OPPORTUNITIES TO INDONESIAN ISLAMIC INVESTORS?

DO ISLAMIC CRYPTOCURRENCIES PROVIDE DIVERSIFICATION OPPORTUNITIES TO INDONESIAN ISLAMIC INVESTORS?

Blog Article

This study examines whether Islamic gold-backed cryptocurrencies (Onegram and X8X) provide any diversification benefits to the Islamic investors of Indonesia.We study the co-movements between return and volatility of cryptocurrencies and Indonesian Islamic equity indices during the pre-COVID-19 and COVID-19 periods.We employ Multivariate Generalized Autoregressive Conditional Heteroscedastic-Dynamic Toddler Car Seat Accessories Conditional Correlation (M-GARCH-DCC) and Continuous Wavelet Transforms (CWT) for this study.We find that the COVID-19 crisis enhanced the spillover effect among the Islamic gold-backed cryptocurrencies and Islamic equities.We also provide evidence that Indonesian investors may invest in cryptocurrencies to minimize the equity sector Pressure Cooker risks during the pandemic.

Our results bear significant implications for portfolio diversification strategies for Indonesian investors.