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Application of Delphi Process and Rasch Analysis in the Development of Shariah-Compliant Gold Investment Instrument 

Dr. Najahudin Lateh
Profesor Dr. Muhamad Rahimi Osman
Prof. Madya Dr. Ghafarullahhuddin Din
Siti Noorbiah Md Rejab

Academy of Contemporary Islamic Studies (ACIS)
Universiti Teknologi MARA, Shah Alam

The objective of this study is to describe the design process for Shariah-Compliant Gold Investment instruments (SCGI-i) using the Classical Delphi Technique (CDT) and Fuzzy Delphi Method (FDM). Rasch measurement model was used to examine the validity of items by two criteria; (1) point measure correlation (PTMEA CORR) and (2) fit statistics (infit/outfit MNSQ and z-std). As a result, this study is successfully able to form SCGI-i consisting of three dimensions and 33 items have good validity. These instruments can potentially be used by Islamic financial institutions to create new products or shariah audit of existing gold investments to comply with the requirements of Islamic Muamalat.

- Current reality shows overwhelming response from the public towards gold investments
- This is shown by the appearance of numerous companies offering a variety of investment and most are not in accordance with law
- MPS financial institutions in Malaysia in the resolution of discussion of the 8th time which concluded that Parameters of Gold Investment need to be updated and further studies need to be done (JAKIM, 2012).

This study is based on Design and Developmental Research (Richey & Klien, 2007)

To develop and evaluate SCGI instrument agreed upon by Islamic muamalat experts

Phase 1 – Need analysis
Phase 2 – Design and develop SCGI-i
Phase 3 – Usability evaluation

1. Need Analysis
Questionnaire 56 gold investors and interview 3 expert review

2. Design
Modified Delphi Technique (2 round) 13 experts

  • 2 members of the National Fatwa Council
    2 members of the Shariah Advisor at BNM
    2 members of the Shariah Advisor at SC
    2 researchers ISRA
    2 heads department of Shariah (Islamic Banking)
    3 academicians (in Muamalat) public universities

Round 1 - validate data and get expert consensus on 34 items were built based on a literature review

Round 2 - aims to get agreement among experts on items that have not been agreed in 1st round

(i). Classical Delphi Analyzes
Determination of an agreement is based on:
- the median score for four-point scale is at least 3.25 (Green, 1982)
- IQR score 0.00 – 1.00 (high consensus), 1.01 – 1.99 (medium consensus), ≥ 2.00 (no consensus) (Saedah & Paris, 2011)

(ii). FDM analyzes (triangular fuzzy number):
The expert consensus has been reached:
- if the value less than 0.2 ( d≤ 0.2) (Chen, 2000; Cheng & Lin, 2002)
- when the percentage of the experts consensus is more than 75% ( ≥75%) (Chu & Hwang, 2008; Murray & Hammons, 1995)

3. Usability Evaluation
- Evaluate using Rasch Measurement Model (Questionnaire 40 Investors and gold investment institution)
- The rating scale for the statistic data: PTMEA CORR > 0.4 – 0.8 (Linacre, 2011; Azrilah, 2010), MNSQ infit and outfit of 0.5 - 1.5 (Linacre, 2011; Linacre, 2002), separation value ≥ 2.0 (Linacre, 2011, Fisher, 2007) and reliability value> 0.8 (Bond & Fox 2007)

1. Need Analysis
- 100% respondent need to the SCGI-i
- SCGI-i containing 3 dimensions and 34 items: (i) investor & investment institutions (5 items); (ii) products & prices (19 items); and (iii) the contracts offered (10 items)

2. Design : Modified Delphi Technique
- Round 1: the score IQR=0.00-1.00; Mdn=4.00 to accept these 3-dimensional, 32 of the original item and the new item (C11) and rejected two original item (B05; B15).
- Round 2: the total of experts agreed for 33 items SCGI instrument which is embedded in 3 dimensions (IQR=0.00-1.00; mdn=4.00)
- FDM analyzes indicate that the constructs of d threshold and all items d≤ 0.2 and expert consensus is ≥75%

3. Usability Evaluation: Rasch Model Measurement
- SCGI can be accepted and has a high reliability (person = 91; item = 81) with Cronbach alpha 0.93
- the item separation is 2.07 while the person separation is a value of 3.15
- only one item (A03) was identified as a misfit and had to be eliminated (PTMEA CORR= -0.17logit infit MNSQ=+1.27logit; z-std=2.9;)
- the rest of the items were maintained due to their high validity characteristics (positive PTMEA CORR values; infit MNSQ=+0.44logit to +1.66logit; and z-std> -/+2)
- the final instrument contained only 32 items 

Phase 1: Need Analysis
- The need to the Shariah-Compliant Gold Investment instrument (SCGI-i)
Product: Research papers - Data being analyzed: Conference Paper and Indexed Journal - SCGI-i Around the World

Phase 2: Design
The design of SCGI-i according to the expert of Islamic Muamalat
Product: MyIPO Copyright Version of SCGI-i and Fuzzy Delphi Analyzes Template

Phase 3: Usability Evaluation
Usability with high validity and reliability of instrument according to Rasch Measurement Model.
Product: SCGI-I Booklet and SCGI-i Test Template

Academy of Contemporary Islamic Studies (ACIS) 
Universiti Teknologi MARA (UiTM) 
40450 Shah Alam, Selangor

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