Testing The Islamic Stock Market Efficiency:, The Case Of Ftse Shariah Indexes

Abstract

: This study aims to test the hypothesis of the weak level of the efficiency of Islamic stock indices. The data consists of the daily market prices for the Financial Times Islamic indicators expressed in US dollars and covers the period from October 14, 2013 to August 20, 2018. The study was conducted using various statistical tests to check the weak level of efficiency. All tests rejected the null hypothesis that Islamic stock indices are characterized by the characteristics of the weak level of efficiency. This means that future changes in prices do not move independently, and therefore the Islamic stock markets do not follow the random walk model, and therefore future returns can be predicted using historical prices, and this proves that they prove to be inefficient.