A STUDY ON DEVELOPING SINGAPORE AS A CAPTIVE INSURANCE CENTRE

Abstract

With the recent appreciation of the Yen, Japan is beginning to exhibit significant impact on the global financial markets. This study investigates the resilience of the systematic risk, market variance and the total risk of stocks traded on the Tokyo Stock Exchange following the Tien An Men Square incident in Beijing, China on June 4th, 1989. It also sets out to discover if the incident resulted in significant abnormal returns for the shareholders of the common stocks of the Japanese companies with and without vested interest in China. It was found that there was no significant change in the systematic risk and total risk following the disorder in China. The market variance was found to be different before and after the incident. There was also no significant abnormal returns gained from the vested or non-vested company's stocks.