The Effect of Use Passive Portfolio Management Strategy on The Efficient Portfolio of Common Stocks Application Study in Iraq stock market

Ali Jairan Abdul Ali, Ahmed Jabbar Gaid

THE IRAQI MAGAZINJE FOR MANAGERIAL SCIENCES
2018, Volume 14, Issue 57, Pages 181-217

Abstract

This study attempts to highlight the features of the investment portfolio, which is one of the most important tools that took an important place in investment studies, and took multiple forms and shapes, and this requires careful identification of all its elements and types, with a focus on some of these types that are of particular importance in investment. This study focused on the use of One of the portfolio investment strategies, which is the static management strategy for building a portfolio of shares in the Iraqi Stock Exchange to determine whether “the use of the static management strategy – specifically – the strategy of tracking the index by complete simulation outperforms the performance of ordinary stock portfolios that use one of the basic criteria for active management.” Using the monthly data of a sample consisting of (23) companies listed on the Iraqi Stock Exchange for the period from (2012-2016) assuming that the use of the static management approach can necessarily lead to improving the characteristics of the portfolio and its performance, and then measuring that performance. Among the conclusions, the most important of which was that choosing the stocks of the static portfolio according to the “highest liquidity criterion improves the characteristics of the portfolio in terms of return and risk.” Hence, it recommended choosing the portfolio using the static portfolio management strategy in accordance with this criterion.