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Analyzing Financial Performance Of Insurance Companies Traded In BIST via Fuzzy Shannon's Entropy Based Fuzzy TOPSIS Methodology

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  • Ahmet Aytekin
  • Çağlar Karamaşa

Abstract

Analyzing firms’ performance appropriately is essential issue for decision makers working in financial sector under the conditions of imprecise and incomplete information. Additionally it can be useful tool for firms in terms of competitive power and sector development. In this study financial performance of six insurance companies traded in BIST is analyzed by using six financial indicators within the period of 2011-2015. For this purpose firstly weights of criteria related to financial ratios are obtained by using fuzzy Shannon’s entropy based on -level set. Following to this firms’ final rankings are determined by means of fuzzy TOPSIS (Technique for Order Preference by Similarity to Ideal Solution) method.

Suggested Citation

  • Ahmet Aytekin & Çağlar Karamaşa, 2017. "Analyzing Financial Performance Of Insurance Companies Traded In BIST via Fuzzy Shannon's Entropy Based Fuzzy TOPSIS Methodology," Alphanumeric Journal, Bahadir Fatih Yildirim, vol. 5(1), pages 51-84, June.
    • Handle: RePEc:anm:alpnmr:v:5:y:2017:i:1:p:51-84
    DOI: http://dx.doi.org/10.17093/alphanumeric.323832
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    References listed on IDEAS

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    1. Liang, Gin-Shuh, 1999. "Fuzzy MCDM based on ideal and anti-ideal concepts," European Journal of Operational Research, Elsevier, vol. 112(3), pages 682-691, February.
    2. Choudhary, Devendra & Shankar, Ravi, 2012. "An STEEP-fuzzy AHP-TOPSIS framework for evaluation and selection of thermal power plant location: A case study from India," Energy, Elsevier, vol. 42(1), pages 510-521.
    3. Zhang, Hong & Gu, Chao-lin & Gu, Lu-wen & Zhang, Yan, 2011. "The evaluation of tourism destination competitiveness by TOPSIS & information entropy – A case in the Yangtze River Delta of China," Tourism Management, Elsevier, vol. 32(2), pages 443-451.
    4. Guangquan Zhang & Jie Lu, 2003. "An Integrated Group Decision-Making Method Dealing with Fuzzy Preferences for Alternatives and Individual Judgments for Selection Criteria," Group Decision and Negotiation, Springer, vol. 12(6), pages 501-515, November.
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    Cited by:

    1. Selcuk Kendirli & Muhammet Selcuk Kaya & Mustafa Bilgin, 2020. "Evaluation of Financial Performances of SME’s Listed in the Bist Sme Industrial Index by Using TOPSIS Multicriteria Decision Making Method," Journal of Economic Development, Environment and People, Alliance of Central-Eastern European Universities, vol. 9(3), pages 63-74, September.
    2. Tsvetkova, Liudmila & Okhrimenko, Igor & Belousova, Tamara & Khuzhamov, Leonid, 2022. "Relationship and mutual influence between poverty and insurance in a developing insurance market," Journal of Behavioral and Experimental Finance, Elsevier, vol. 36(C).

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    More about this item

    Keywords

    Fuzzy Shannon's Entropy; Fuzzy TOPSIS; Insurance Companies; Multi Criteria Decision Making; Performance Analysis;
    All these keywords.

    JEL classification:

    • C44 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Operations Research; Statistical Decision Theory

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