Precious metals as hedge and safe haven for African stock markets

Muhammad Abubakr Naeem; Abraham Agyemang; Md Iftekhar Hasan Chowdhury; Mudassar Hasan; Syed Jawad Hussain Shahzad

doi:10.1016/j.resourpol.2022.102781

Precious metals as hedge and safe haven for African stock markets

Muhammad Abubakr Naeem, Abraham Agyemang, Md Iftekhar Hasan Chowdhury, Mudassar Hasan, Syed Jawad Hussain Shahzad^*

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

18 Citations (Scopus)

Abstract

This study investigates the diversification properties of precious metals for African stock markets. We report that gold offers the strongest safe haven and hedging potential for African equity markets. Our quantile-coherency analysis indicates a low safe haven ability of precious metals in the long-run. Palladium provides both safe haven and hedge opportunities in the short-term, while Platinum holds only its hedging potential in the same spectrum. The GFC period provides important revelations; gold joins platinum as a safe haven with silver as a hedge. Our results suggest dynamic diversification opportunities for investors in African equity markets using precious metals more so in the short-term.

Original language	English
Article number	102781
Number of pages	14
Journal	Resources Policy
Volume	78
Early online date	7 Jun 2022
DOIs	https://doi.org/10.1016/j.resourpol.2022.102781
Publication status	Published - 1 Sept 2022
Externally published	Yes

Keywords

African stock markets
Hedge effectiveness
Precious metals
Quantile coherency

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10.1016/j.resourpol.2022.102781

Cite this

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title = "Precious metals as hedge and safe haven for African stock markets",

abstract = "This study investigates the diversification properties of precious metals for African stock markets. We report that gold offers the strongest safe haven and hedging potential for African equity markets. Our quantile-coherency analysis indicates a low safe haven ability of precious metals in the long-run. Palladium provides both safe haven and hedge opportunities in the short-term, while Platinum holds only its hedging potential in the same spectrum. The GFC period provides important revelations; gold joins platinum as a safe haven with silver as a hedge. Our results suggest dynamic diversification opportunities for investors in African equity markets using precious metals more so in the short-term.",

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AU - Naeem, Muhammad Abubakr

AU - Agyemang, Abraham

AU - Hasan Chowdhury, Md Iftekhar

AU - Hasan, Mudassar

AU - Shahzad, Syed Jawad Hussain

PY - 2022/9/1

Y1 - 2022/9/1

N2 - This study investigates the diversification properties of precious metals for African stock markets. We report that gold offers the strongest safe haven and hedging potential for African equity markets. Our quantile-coherency analysis indicates a low safe haven ability of precious metals in the long-run. Palladium provides both safe haven and hedge opportunities in the short-term, while Platinum holds only its hedging potential in the same spectrum. The GFC period provides important revelations; gold joins platinum as a safe haven with silver as a hedge. Our results suggest dynamic diversification opportunities for investors in African equity markets using precious metals more so in the short-term.

AB - This study investigates the diversification properties of precious metals for African stock markets. We report that gold offers the strongest safe haven and hedging potential for African equity markets. Our quantile-coherency analysis indicates a low safe haven ability of precious metals in the long-run. Palladium provides both safe haven and hedge opportunities in the short-term, while Platinum holds only its hedging potential in the same spectrum. The GFC period provides important revelations; gold joins platinum as a safe haven with silver as a hedge. Our results suggest dynamic diversification opportunities for investors in African equity markets using precious metals more so in the short-term.

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KW - Quantile coherency

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Precious metals as hedge and safe haven for African stock markets

Abstract

Keywords

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