Factors influencing the performance of I-REITS in Malaysia / Mimi Syahirah Abdul Latif

Malaysia's Islamic capital market is emerging in achieving a total worth of 1.9 million or 61 percent of the overall Malaysian capital market as of December 2018. The establishment of Islamic Real Estate Investment Trust (i-REIT) gained demand from investors in the Islamic capital market that claims to be a safe investment as it is attached to the real estate to generate the source of income. Nevertheless, the Islamic REITs are structured and operating in accordance with the Shariah principle laid out by the Malaysia securities commission, as it is beneficial to the potential investors given its high liquidity and diversification opportunity compared to investing in physical property. This study determines the factors influencing the performance of i-REITs in Malaysia by looking into dividend yield, interest rate, trading volume, and crude oil price. This study adopts a quantitative analysis approach. Panel data was performed on the collected data from the four listed i-REITS, Al-' Aqar Healthcare REIT, Axis REIT, KLCC REIT, and Al-Salam REIT. Data was extracted from annual reports on their websites, World Bank Data, and Bursa Malaysia of selected REIT for a six-year transaction period (2015-2020). The research suggested that dividend yield is positively significant to iREITs stock return. The results of the study also suggest and support rebutting the commonly held belief that crude oil price is correlated with the performance of the stock market. It is hoped that the study can contribute to a better understanding of this innovative investment product.
Keywords: i-REITs, Stock Return, Dividend Yield, Interest Rate, Trading Volume, Crude Oil Price