Prestigious SC Capital Market Award goes to USM PhD holder

Kuala Lumpur, 12 July 2001

Securities Commission (SC) Chairman Datuk Ali Abdul Kadir presented the prestigious SC Capital Market Award 2000 to Universiti Sains Malaysia (USM) PhD holder Dr Ch'ng Huck Khoon at the SC here today.

Dr Ch'ng's entry, "How Many Securities Make a Diversified Portfolio: KLSE Stocks?", clinched the award in the postgraduate category and won the cash prize of RM15,000 and a trophy. There was no winner in the faculty category of the award.

The research paper, which forms a chapter in Dr Ch'ng's PhD thesis, examines the relationship between portfolio risk and the number of stocks in a well-diversified portfolio for a given portfolio return. Dr Ch'ng's research focused on a sample of Malaysian stocks traded on the Kuala Lumpur Stock Exchange (KLSE) from September 1988 to June 1997, using the random diversification approach and the Markowitz mean-variance optimisation approach to determine the optimum size for a portfolio of stocks.

The paper concluded that, on average, a well-diversified portfolio of Malaysian stocks is found to contain at least 27 randomly chosen securities whereas under the Markowitz approach, a portfolio of 22 securities is considered a diversified portfolio.

A remisier since 1995, Dr Ch'ng also lectures on capital market-related areas on a free-lance basis.

Other than USM's winning entry, there were two other submissions in the postgraduate category - from Universiti Putra Malaysia (UPM) and University of Warwick, United Kingdom. The four entries under the faculty category were from Universiti Malaysia Sabah, Universiti Malaysia Sarawak (UNIMAS), Griffith University, Australia and UPM.

The SC introduced the SC Capital Market Award in 1995 to create awareness of and encourage quality research on the Malaysian capital market. Entries have to be submitted through universities; each allowed to submit only one entry per category.

"Since 1995, the prestigious award had succeeded in promoting interest and research in the Malaysian capital market judging from the increasing number and quality of research papers received," said Datuk Ali in his opening remarks at the ceremony.

Datuk Ali also said the award, which is managed by the Securities Industry Development Centre (SIDC) of the SC, is in line with the SIDC's aspiration to be in the forefront of research in the Malaysian capital market, complementing its strength in training and education.

He added the dissemination of non-proprietary research will help promote the development of a sound, stable and sophisticated capital market.

The award entries are judged by the SC Capital Market Award Review Committee which comprises a director and two Members of the SC.

Entries for the award may be in the form of project papers, thesis or dissertations. The award is divided into two categories, Category A for postgraduates and Category B for faculty members of institutes of higher learning. The winner for each category receives a cash prize of RM15,000 and a trophy.

The SC Chairman also launched the SC Capital Market Award for 2001. Details of this year's competition are available on the SC website at


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