Background of the Study

Malaysia is one of the largest producers of palm oil. It exports large amount of the crude palm oil to all over the world and that is why it is the leading palm oil exporter in the world. However, it is found that the business of palm oil is associated with high risk as its production is dependent on weather condition and the demand for the product is dependent greatly on the demand from the abroad countries (Chong, 2021). Therefore, it can be said that the market of palm oil is uncertain and has risk. Due to this reason, the millers, producers and exporters of palm oil sell futures commodities of crude palm oil in order to lower the burden of risk. This generated the market for Futures Crude Palm Oil (FCPO) commodities market. Now, with gradual advancement of technology most of the possible financial transactions are getting shifted to online platform. Likewise, the commodities market for FCPO has been introduced to online platform of Bursa Malaysia. An investor can invest in FCPO commodities by purchasing them from online portal of Bursa Malaysia or by getting assistance from brokerage firms. It should be noted that even the brokerage firms are providing service through the online medium. However, it is found that investors are not able to trust the online trading medium for investing in FCPO commodities. Therefore, it can be said that there are factors that are affecting investors that are leading to trust issues related to the online market for FCPO commodities (Nik Ibrahim et.al., 2022). Therefore, in this research study the major aim is to find the factors that could affect the investor’s trust to trade FCPO commodities online. In order to do so, the author would set research questions such that study can be done in a more robust way.

Online trading is the newest mode of trading in shares and stocks. With this new mode of trading the investors are able to trade in stocks, shares, derivatives and futures in a much less time but along with that there generated various kind of issues. It should be noted that the system has various issues such as less transparency maintained by the brokers or agents who manage the money of the investors. It is further found that in order to make most of the investments it is required to have high end systems in order to take fast decisions. In addition to that, using slow or unstable connections by the agents might delay the process of investment and leads to higher loss or less gain (Drachal and Paw?owski, 2021). The chance of loss increases when the market on which the money is invested becomes more volatile that is the price of the product varies more abruptly. This would mean the FCPO commodities online market would exhibit the similar characteristics and that is why the investors might become skeptical about investing in the market. The industry of crude palm oil in Malaysia is a lucrative business and that is why the investing in the futures of such a product could gain high return. However, if the issues persisted in case of online trading would definitely the affect the online trading of FCPO commodities. It would mean that with that with lower level of investment in the FCPO commodities market and thereby the industry of palm oil would suffer which would in turn affect the economy of Malaysia adversely. This report research will include the study of FCPO and oil industry in details. After that a detail introduction about online platform and its impact on FCPO market.

Background of FCPO

FCPO commodities in Malaysia are being traded for long years. The reason behind choosing this trading platform is it will be helpful for managing wide range of online platform and deals with investors investing factors with FCPO commodities via online platform. It would mean that even after fluctuation in the industry with ups and downs. It should be noted that the economy of Malaysia is greatly impacted by the industry of palm oil. It is thus obvious that the GDP of Malaysia is highly influenced by the business of crude palm oil. Hence, it can be said that FCPO commodities market too have impact on the economy of the country (Cao and Garcia-Feijóo, 2021). It should be noted that main objective of introducing FCPO commodities is to stabilize the palm oil industry in the country. The investment in these commodities would lower the risk associated with the industry and thereby the hit to the major stakeholders of the industry would be lower and that leads to more stability in the industry of palm oil. It further can be said that oil industry in the Malaysia can lead the success and provide significant growth to the different investors who can improve their lifestyles.

Palm oil industry is of great importance in the economy of Malaysia because of its great contribution to the economy of the country. It should be noted that, Malaysia is the second largest producer of palm oil after Indonesia. If the production of these countries are combined then it can be observed that more than 80% of the palm oil production of the world are produced by the said two countries (Barrett, 2021). It is one of the greatest provider of employment in the country. It should be noted that many countries are unwilling to use palm oil due to the environmental concern. It should be noted that with time the revenue of the industry has declined which is why the contribution of the industry to the GDP of Malaysia has declined. However, it is expected with improvement in the FCPO market there will be growth in economy of Malaysia. The main reason behind founded oil industry is to provide heat to the building, produce electricity and for providing fuel to the vehicle.

The price of FCPO commodities are completely dependent on the price of palm oil in Malaysia. It is found that in the recent times the price of palm oil in the country has fluctuated significantly but the price trend within the country is upward sloping. Based on this behaviour of the market for FCPO commodities. Therefore, with continuous rise in price of palm oil there will be high FCPO commodities price as well (Li and Semedi, 2021). However, due to high price of the FCPO commodities the investors would make low investment in the product causing cessation of leading businesses in Malaysia. Therefore, it can be said that FCPO market is going through a weak phase during this time. Therefore, it can be said that investment in eh FCPO commodities due to tis reason would fall. Due to the tight supply chain of palm oil, and a mixture of the palm oil with sunflower oil can become the reason for large scale conflicts in different sectors.

Background of Oil Industry

It is found from data that in the last three years the performance of palm oil industry has been good in terms of production. The industry currently contributes nearly the 3% to the GDP of Malaysia. The majority of the export revenue comes from sales of palm oil. Therefore, it can be said that the employees working in this industry is very high compared to the population (Thévenot, 2022). Again, it should be noted that price of palm oil in Malaysia was rising in the initial months of 2020 but after advent of COVID 19, the price fell significantly. Again, it should be noted that the price fell continuously till May of 2020 but after the pandemic situation the price of palm oil in latter of half of the year. Hence, it can be said that the current situation of the palm oil in industry in Malaysia.

The research study is conducted in order to find the factors that affect the investors trading FCPO commodities online. The main issue which is needed to identify in this research is to explore the ways and impact of investors that they can faced due to purchase of FCPO commodities through online platform. It is found that people have not yet able to make transactions using online platform. This thing is more prominent in case of online trading platforms (Barrett, 2021). It should be noted that, investors cannot completely trust the agents who provide the service of share, stock and derivatives market such that the investors get higher return on their investment. It should be further noted that FCPO commodities are highly fluctuating due to abrupt change in price of palm oil in the market since its price is highly affected by international economic changes (Alwi et.al., 2021). Further, production of palm oil is highly uncertain as weather condition could hamper the production of palm trees and thereby the oil production in the country would fall. Further, it should be noted that many investors are not comfortable in using online trading platforms. Again, it should be noted that behaviour of people is a great factor that influences the use of online platform be it for online trading or learning. This can be analysed using Technology Acceptance Model (TAM). The framework helps to understand the factors that may impact the investor’s trust in using the online trading platform used for trading of FCPO commodities.

The research questions of the study are given as follows:

1. How acceptance of online platform by investors could impact the trading of FCPO commodities?
2. How the intention of investors to use online platform could impact the trading of FCPO commodities online?
3. How knowledgeable are the investors in using online trading platform?

Current Situation of the Study

The study is conducted based on the online trading of FCPO commodities and it aims to study the factors that have impact on investors trading FCPO commodities online. Based on the aim of the study the objectives are given as follows:

1. To analyse the use of online platform by investors for making trade of FCPO commodities.
2. To determine the intention of investors to use online platform for making trade of FCPO commodities.
3. To evaluate about the ability of the investors to use online platform.

The financial products are now sold in online platform just like any other consumer goods. It should be noted that the futures commodities of crude palm oil in Malaysia is one of the greatest trading market. It has great potential of boosting the stock market transaction in the country and if the online trading of the product runs in a smooth way then the economy of Malaysia could gain from it significantly (Lubis et.al., 2021). Hence, this study will put light on the factors that would impact the trust of investors and thereby help to find out the loopholes, solving which boost the use of online trading of FCPO commodities. It will be helpful for ensuring the factors which may affect the investor’s investment while they doing online purchase of FCPO commodities. 

The research study would explore the trade pattern of FCPO commodities online. It means the study only focus on online trading but not delve into non-online trade of FCPO commodities. The study investigates upon the factors that could influence the trust of investors who are engaged in trading of FCPO commodities and try to find out how the variation in those factors alter the trade pattern of the commodities (Khatiwada, Palmén and Silveira, 2021). However, the study is conducted within a limited time frame with study of limited amount of data. The findings for study would lead to the answers of the research questions. The respondents who are agree for providing information are also gain the value of scope and gain the profit for FCPO commodities within market.

Commodities: The purchase of future contract of a commodity that will be delivered in a future date after expiry of the contract.

Online trading: Mode of stock market trading through online platforms.

Investors: A person or company who put money in any type of financial scheme.

Online platform: A platform where digital services are provided for facilitate the interaction with set of wide independents individuals.

The chapter described the topic of the research study. In addition to that described about the industry and the product associated with it. Further, the chapter described the problem statement. Addressing the problem statement, research questions and objectives are formed. Finally, the significance of the study is mentioned.

Current Situation of FCPO

A literature review or review of literature is said to be a critical analysis of the topic chosen by the researcher. This research will help the researcher in showcasing some of the past as well as recent dynamics of Future Crude Palm Oil in Malaysia. However, in this literature review, the researcher will consider some of the significant theoretical frameworks, methodologies in order to frame and analyse the logic behind every statement. Sometimes, most of the researches illuminates major debates and controversies happened within the discipline. This provides an extra edge to the research report, and determines the researcher’s contribution in this field which is importantly considered as valuable. Therefore, all the information provided in this perspective will be according to the market and palm industry in Malaysia. However, the market of palm oil in Malaysia was prominent in terms of increasing the economy of the nation. On the other hand, weakening in the market provided opportunities to the European countries to put allegation on the activities regulated under the palm oil industry. Thus, this present report will provide with an overview about what went wrong for the palm industries and how they lose their dominancy from the market.  

Across the world, Malaysia is considered to be the largest producers of palm oil, and labelled as the largest exporter of crude palm oil. The main reason is because of the large export of the crude palm oil around the world by Malaysia. Even though, the business in Malaysia seems to be profitable but the business is also associated with high risk, and it is generally due to two reasons first, the farmers very much depend on the weather conditions. Secondly, huge dependency on the demands of the foreign countries (Alii, Karimi and Febriamansyah, 2021). Thus, considering both the factors, it can be said that, palm oil business is full of uncertainties, and because of this, the miller, exporter and the producers are compelled to sell their futures commodities to the manufacturers of palm crude oil so that the risk can be minimised. However, now with the evolution of various kinds of technologies, the market of Future Crude Palm Oil has experienced a great change. For example, over the period of time, the financial transaction has transformed completely from offline to online. So, now buyers can directly purchase the commodities from online portal. Despite of providing such an easy method for making online transaction and purchasing goods, most of the investors developed a trust issue while doing online purchasing or investment in FCPO commodities (Baranidharan and Sutha, 2021). Hence, it put a huge impact on the online portal, and the market dedicated for selling and buying foods related to FCPO products. Therefore, the present research will completely focus on the behaviour of investors in context with the trading of FCPO commodities. Moreover, how effectively their behaviour has impacted the online platform will be determined through the following literature review.

Current Situation of the Industry

Since, 1980s the Future Crude Palm Oil is setting a benchmark for all the edible oils and fats industry players, as it has consolidated the higher position in the leading global market of Palm oil. In context of the GDP of Malaysia, it is highly dependent on the performance of the Palm oil industry. In the year 2018, Palm oil industry made its contribution of approximately 7 percent in the GDP of Malaysia. However, Malaysia was not the first country which planted palm oil rather it was West Africa where the evidence of first palm plantation was found. In later years it came to Malaysia and since then it is providing effective services and facilities to its investors (Kahar et.al., 2022).  Most of the crude palm oil were exported to different parts of the world, mainly in the western countries. But because of the improper trading activities the leading company lost its market share, and developed a sense of distrust amongst the investors.

As we have already mentioned in the above statements of the history of FCPO commodities, that from its establishment the company has been the most popular industry in the field of Palm oil. Nevertheless, the market share of the company has been increasingly growing with the passing years. For example, if we compare the interest of investors in commodity future market then in the year 2003 it was $20 billion, and by the year 2010 it significantly raised to $250 billion. This shows that trading related to the commodity future pointedly increase, and moving forward it provided benefits to the investors. Later on, after coming of the online platform, the trading became easier as the services were provided by the online brokers (Listiningrum et.al., 2021). Therefore, investors of FCPO shifted towards online trading but after some time, the investors faced trust issues, and preferred to purchase the commodities from service providers who are physically present. Considering the recent issues, the online portal or system was having various problems such as, proper transparency was not maintained. As a result, managing the activities for agents and brokers seemed to be unmanageable. It is important that to regulate a business and its functions like trading, the company should have proper connection so that, all the functions can be regulated in a smooth manner. But, in the case of FCPO, most of the time, the connection use to be very slow because of which the process of transaction faced a delay, and as a repercussion to this, the investors who invested their hard earn money experienced hug losses. Further, if the company doesn’t focus on the issues, it remains persistent then there can be a possibility that the online trading of FCPO commodities can lose its essence, and may direct the investors towards service providers who are physically present (Agustin, Astari and Rosmawati, 2021). As a result, Future Crude Palm Oil (FCPO) may face huge loses. This demonstrate that, FCPO should inculcate certain rules and regulations that can match the characteristics of successful business. This will attract large number of investors, and once again crude oil business in Malaysia will become lucrative and will get high returns from the market. FCPO will help the investors to make sure about the authorities and try to gain the global price at international level. This further helps in managing resources and provide information that are associated to the managing culture of the FCPO commodities.

Problem Statement

However, the history of Palm oil is very old but it is from last five decades i.e., 1995 and 2015 that the production of Palm oil has steadily increased. This can be evident by analysing the annual production quadrupled that raised from 15.2m tonnes to 62.6m tonnes. Further, by the year 2050, the quadrupled will reach to 240m tonnes. The main reason behind this is the use of products containing palm oil by 3 billion people in around 150 countries. Tracing the history of Palm oil industry, before the mid-19^th century, the oil was produced by a handful of people (i.e., local livelihoods) in West Africa. Later, a surge in the demands of palm oil noticed during the industrial revolution (Sakai et.al., 2022).  Increase in the demands of palm oil led to the plantation of more palm trees in different areas so that, the suppliers can secure the reliable supplies of the same.  By the 1870s, the prime export of palm oil in many parts of the West African countries increased. In the year 1911, Oil Mill of the Belgian Congo was founded. Therefore, with the help of this project, the venture tried to export palm fruit and oil to Europe. However, even after the mechanism was successfully introduced the venture failed to attract a large number of workforce because which the production decreased and the venture faced a huge loss (An illustrated history of industrial palm oil, 2020).

Until 1948, palm oils didn’t arrive in the Southeast Asia, it happened when a Dutch botanists planted some seeds of palm oil tree in the botanical garden in Bogor on the Indonesian island of Java. Today, Southeast Asia has become one of the leading producers of Palm oil with around 85 percent of the world’s supply. With the setup of Indonesia’s first palm oil plantation at Poelae Radja in Sumatra in 1911, Indonesia took it first step in the world of Palm oil. Further in upcoming years in 1917, first commercial estate in Selangor was established by two French Planters. Therefore, with the help of the open-door policy, and by 1939, the country surpasses Nigeria in palm oil exports. After this, the country looked back and gained huge profits from palm oil business.

According to the recent report, the palm oil industry in Malaysia has a tough time ahead as the industry has been accused for many reasons, and some of them are: mechanization & advancement, supply & demand of oils, unfair & negative NGO reporting, European Union’s protectionist policies and many more. Considering the challenges from the west, palm oil sector is facing issues over policies or ban. For example, United States, recently bans two major Malaysian Palm oil producers named FGV and Sime Darby by claiming that both the companies are violating the human rights (Snashall and Poulos, 2021). Moreover, as the palm oil industry in Malaysia produces huge traded edible oil globally so, the industry is always exposed to the price volatility. This is the reason sometimes the palm oil industry faces backlashes from the investors, resultant in huge losses. However, despite of so many issues, the Malaysian government is looking for increasing the production of palm oil in the country so that exporting the same, the country can boost its economy (Challenges faced by Malaysian Palm oil & the way Forward. 2021). Therefore, by considering this move from the government, the Malaysian palm oil industry is way forward to adopt multi-prolonged strategy. For example, technological advancement in order to get higher output, providing valid certifications to the industry so that 100 percent sustainability can be retained. Malaysian Palm oil industry is looking for market expansion, the best and the easiest way to strengthen the position in the global market. Hence, as a whole, with a proper communication and with continuous engagement the Malaysian Palm oil industry can regain the position which it used to be years back.

The main purpose of doing this research is to know about the factors that are affecting the investors from trading online. From the time, when online platform was provided to the investors, they were facing huge issues in context to online transactions. As a result, investors lost their trust from agents who were responsible for regulating the activities. A high fluctuation in the rates of the commodities of FCPO were seen, therefore, all these factors put a huge impact on the market of the palm oil. Industries were uncertain whether they should continue with the production of the palm oils or not (Drachal and Paw?owski, 2021). Therefore, the obvious gap is the technology FCPO is using and the services they are providing. Without knowing how much the online platform is influencing the behaviour of the investors the company is providing them with the services. However, to deal with this, the company should adopt a model i.e., Technology Acceptance Model (TAM), thus, with the help of proper optimisation of this model, FCPO can determine the behaviour of investors can based on that FCPO can provide their services and facilities, whether it is related to online trading or any other activities. With the help of this literature review it can be said that palm oil industry will be helpful for create relationship and manage the growth in their business sectors.

A literature review, also known as a review of literature, is a critical examination of the study topic chosen by the researcher. Essentially, it is a synopsis of the questions that the researcher is seeking answers to. The researcher compares, contrasts, and analyses the variables to see whether there is any link between them. The nature of the issue determines whether or not a literature review may be used as a stand-alone piece. The primary goal of this literature study is to provide context so that a justification for the issue may be determined in accordance with the requirements (Nurkhoiry et.al., 2021). Furthermore, a literature study is a solid method for tracing any type of historical thinking progression. Considering the variables and dimension of this literature review it is revolving around the trust issues that investor develops because of the misconduct of the FCPO. Whatever the underlying reasons was it has against the ethics because investors however, invest their hard earn money and in return if they do not get the desired result than they feel devastated and hopeless. It is related to explaining wide range of factors which will be explain below and considered an effective growth to FCPO commodities and their variables.

There is a clear relationship between the trust and the increase in the sales of the commodity. If a particular company give better options in trading, then there is a possibility that the demands for the company may increase. More and more trading process with respect to the company in future may increase the market shares which will definitely improve the position in the market area. Further in order to understand the concept in better manner, a detailed analysis of the objectives are mentioned below:

Retailing is considered as the central function to all economies: it works as a bridge for consumers and sellers. Consumer can fulfil their needs by specialising what they actually want from the producers. Retailing function mainly includes legal transactions with consumers, physical logistics of merchandise, communicating in general and lastly, rendering ancillary the services. With the coming online platforms many stationary retailing shops shifted from store-based formats to internet-based platforms (Rosyidi et.al., 2021). Thus, digital transformation drastically changed the value creation process and provided the buyers and the investors with an opportunity to engage directly with the producers. Just like this, FCPO also constituted a platform for investors from where they are purchase the Crude Palm Oil. The online programme emerged as a powerful brand but gradually, after some time, people lost their interest. The main reason behind this was the structural formation of the prime interaction with the customers. Further, the transactions process became slow day by day because of bad internet connection. As a result, the investors developed a trust issue because they don’t find any means to have a look of the service providers physically. Therefore, the markets became more sceptical, and the demand and supply of the products gets highly influenced by the various kinds of macroeconomic variables.

However, after all these issues, the acceptance of online platform from investors could only be possible if FCPO, make effective strategy by considering all the inefficiencies FCPO had in the previous online service. Thus, after making all the alteration in the system, FCPO, will be able to attract investors, and possible contingencies that might have determined the nature of the competition can be avoided (Mizik and Gyarmati, 2021). Below are some of the positive consequences that can put an impact on the trading of FCPO commodities.

• Online acceptance will facilitate the value creation: the characterisation of the value creation is determined by the experience of customers with the buyers. In context with this report, the acceptance of online platform by the investors will fulfil the demands of long-standing needs of the investors. Notably, with more and more engagement with suppliers of FCPO commodities will significantly increase the revenues of the company. Individualisation will not be a concept anymore, as customization and personalisation of the needs according to the marketing efforts will be the highest priority (Arief, Antono and Nurhasanah, 2021). For example, a particular investor who buyers commodities on a regular basis wants to make a purchase. Here, the stores data in a central server will help the seller in subjugating individual on the basis of contextual and comprehensive digital information. Therefore, now with the proper assistance in online platform the broker can engage with the investor in real time.
• There will be proper transparency and control: transparency is an action that helps in providing customers with superior information related to the product. In context to this, with the use of online platform, it will simplify the access of the investors in retrieving the information about the comprehensive product i.e., FCPO commodities. Thus, in simple words, the more access to the information the more investor will feel connected with the product.

Use of online platform: The spectacular rise in the purchase of products online increased after the marketers provides customers with an opportunity to select their desired products through internet. Online platform became one of the integral tools for companies when there was a need for increasing the customer base. The online platform, provides the customers with all the information related to trading for example, the price of the product, demand of the product etc., therefore, it can be said that the online platform, has the intention to put an impact on the minds of investors regarding the purchase of the product (Yoesgiantoro, Fahrizki and Supriyadi, 2021). For instance, the seller on online platform has a clear picture about the behaviour of the buyer then, the process of purchase can be done effectively because as the seller knows the intent, it will use refine marketing strategy for designing a content that can easily attract the number of investors. Intention of purchasing goods online, is considered to be the one of the most reliable indicators for knowing the behaviour of customer.

Impact of online platform: It has the potentiality to revel someone’s desire i.e., how much a person is more likely to purchase the good. Considering the intention of buyers, it can be classified into two categories, informational intent and transactional intent. In the former one, the investor is on hunt to find as much as information about the products so as to educate themselves about the product or the services. This behaviour will often increase the urge to get information and this gravitate the individual towards reading blogs, articles, guides and many mor things. Thus, the more the information, more the investor will look for the offers in the online trading. Therefore, the percentage of online platform for purchasing FCPO commodities will increase (Bastos Lima, 2021). As a result, it will automatically indicate the engagement of investors in the online platform, and by looking at this, other investors will also regain the trust, and the process will go on smoothly. In terms of transactional intent, as we know from the above statements presented in the situation of the FCPO that, the main reason why investor denied the online platform is because of the improper transactional facilities. The internet or the connection used by FCPO was slow because of which the investor faced challenges in purchasing goods. Thus, if the company manages to implement the changed strategy properly then, the change in the positive intention of investor will deviate towards meaningful actions no matter what was the situation previously.

An online trading platform is considered as a system, in which with the help of a computer software trades are executed under a networked environment. Considering the idea platforms, it is structures in a sophisticated manner that all the database are regulated under adequate security. Thus, it provides investors with information in a more transparent manner. Hence, it is important that, the person who is in trading has enough information about the trading process because one mistake can lead him/her to losses. In most of the cases, trading platform are equipped with various additional features like real-time quotes, news feeds, charting tools etc., hence, an amateur person, if he/she doesn’t have proper knowledge regarding the same then, even though there are real time benefits, the investor will not be able to acquire the same. Hence, the trading platform requires a particular need (Syed and McLean, 2021).

In context with FCPO, it is a commercial trading platform, from where the investors try to purchase the shares of FCPO commodities. But before this, it is important that they choose an appropriate trading platform as converse tool help in visualising the options and other strategies in an effective manner and provides traders with better options of trading. Some trading systems are only available when specific brokers are involved, while others are wary of certain middlemen. It means that the reputation of a broker or middleman should be taken into account before deciding on a trading platform.

Trust is any business whether the business is small, medium or large it plays a crucial role. It is the trust factor that make the process keep going like, investor shows the trust on broker after which the action is performed. Commodities are one of many items traded on the market, and the market has grown significantly. Profit in the trading sector is closely linked to risk and volatility. Commodity trading takes place in the future, that is, before the commodity is produced. Futures trading of commodities is the name given to this form of trade. Because commodity prices change substantially, it is associated with a high level of risk. Palm oil is a significant product in Malaysia, and it has been determined that it makes a significant contribution to the country’s economy. Malaysia’s palm oil sector provides around 7% of the country’s GDP (Reyseliani and Purwanto, 2021). It’s true that, however, because risk is inherent in the sector, refineries, plantation firms, millers, and exporters all trade Futures Crude Palm Oil (FCPO) Commodities. Investors in the trading market then purchase these futures. It’s worth noting that FCPO products have been traded in Malaysia since 1980. It is traded on the Malaysian stock exchange, Bursa. The price of commodity futures fluctuates a lot in the market, making it difficult for investors to judge the market’s state (Thévenot, 2022). Producers, hedgers, and investors risk uncertainty and loss as a result of this. Furthermore, it has been discovered that investors’ interest in the commodities futures market is growing, and the market is increasing significantly.

As a result, it may be stated that commodity futures trading has increased with the growth of the internet and information technology, commodity futures trading on an online platform has risen substantially. Online trading is available for the linked services (Sukiyono et.al., 2022). This led in online FCPO trading in Malaysia, and Bursa Malaysia adopted a similar approach of online FCPO trading. The internet brokers are the ones that supply this service. Online trading has been shown to have trust difficulties because investors are unable to physically contact with or see the service providers.  

Author	Title	Source	Link	Review
Josie Philips	An illustrated history of industrial palm oil	Online article	https://chinadialogue.net/en/food/illustrated-history-of-industrial-palm-oil/	Writer explain the history of industrial palm oil. It is further said the use of process of easy trade and gain industrial revolution. This further helps in analysing about the topic and gain wide range of information which are suitable and gain data to collect the resources in more efficient way.
Faisal Iqbal	Challenges Faced by Malaysian Palm Oil & the Way Forward	Online peer review article	Challenges Faced By Malaysian Palm Oil & The Way Forward	Author explain the challenges faced by company like unpredictable scenario, mechanism and advance use of technology. After that some growth and development strategies has been used to explore the range in an efficient way.

This chapter highlight the information which are relevant for the growth and development of researcher while finding major research articles of the different authors. This chapter details highlight the issue of FCPO commodities and its investment done by different investors via online trading. All can be related to manage application of crude oil and its impact of the Malaysia and its economy. With the help of appropriate systematic review and its discussion on the basis of peer reviewed articles would be helpful for researcher to gain information and collect sources which are applicable for achieve designed hypothesis.

In this chapter, the researcher includes various kinds of instruments and strategies are included that is successfully employed in order to finish the study. With the help of contemporary techniques, the researcher tries to shape the research route which the researcher took for completing the research. Therefore, research methodology complies of ideologies, methodologies along with the designs that will play as a rationale in context with the topic chosen. The main focus of the researcher is to find knowledge using goals and an appropriate method to evaluate or find an appropriate solution to the research questions. To do the same, the researcher analyses the nature and all the variables that are included in the goals. This help in formulating a suitable theory that can be used to gain knowledge of certain objectives that will help to draw a valid conclusion within the study. The main purpose of research methodology is to find answers to research questions through the application of systematic and scientific procedures.

The main purpose of the research methodology is to find answers for the research objectives mentioned in the report. It is important because for the researcher it works a significant action in determining some of the systematic ways in completing the research in a more successful manner. Thus, with the help of a proper methodological tool the researcher can make its research more authentic and valuable. It helps in expanding the range of methods and provide systematic growth to the researcher and gain wide range of application to ensure the long run growth in the business sectors.

• There is Strong relationship between online trading platform for FCPO commodities and the trust of investors.
• There is the need of proper knowledge about the trading platform in order to trading through online platform of FCPO commodities.
• Having unpredictable scenario in the online trading system can be become the major challenge for the Malaysia oil trading company.

While doing research, it is important that the research has proper plan and procedure because the plans will help the researcher in gathering information in more suitable manner. Moreover, improvising the possibilities can only be done if there is proper planning for gathering information, analysing them and interpreting the same for extracting a valid conclusion. Generally, in the research methodology, research approach has its own important as based on the approaches the information is gathered so choosing the appropriate one is very important (Thévenot, 2022). For example, in order to do this research, the researcher will be undertaking deductive approach. This approach will help the research in developing a hypothesis that are mostly dependent on the existing theory, and is suitable for implementing as the research strategy.  Further it helps the research in explaining a relationship between different variables present within the research. Thus, with the help of this method the research will be able to find out a valid conclusion for the research.

A research paradigm is considered as an approach that is used for conducting the research in more appropriate manner. Generally, there are two type research paradigms, positivist and interpretivism. In the positivist approach, the researcher looks for personal values and prefer working independently. Thus, here the researcher most probably seeks for the authenticity of the objectives made. The main characteristic of the positivist approach is that through this the information can be collected in a quantified form. Therefore, representing the collected information in a graphical form is easier. Other than this, the positivist approach considers the logical enquiry so that the explanations and predictions are true to the nature (Supono and Yusuf, 2021).

When conducting research, there are several types of methods the researcher uses to collect reliable data on a research topic and area of ??interest. In this, the researcher must analyse the best and most appropriate technique that helps the researcher in solving specific research problems and at the same time draw a justified conclusion within the study that helps make it more authentic and reliable by nature. Along with this, various methods have been applied to present the study effectively (Maue, 2021). The general procedure directly improves the research process by helping to explain the methods used in the study. In this context, research methods are classified into different aspects and types and each method has its specific nature and purpose of study. Using this method, the researcher can acquire reliable data that help make the correct judgment within the study. In relation with this research, the researcher will undertake descriptive research methods.

It is an important method used to determine the properties of various variables that are present in the current study. Mainly, this type of methodology focuses on answering research questions that relate to the “what” rather than the “why” of a particular research area. Using this method, the researcher can easily determine and assess the type of demographic data present in the study, which will help to obtain more reliable information about the research area. Furthermore, descriptive research is also known as the observational research method because no variables within the study are affected at the time the research activities are carried out (Reyseliani and Purwanto, 2021). Basically, descriptive research refers to the part of quantitative research in which the researcher collects data through surveys. Respondents are asked various questions in order to analyse their real perspective on the respective study area. This can be effective in gathering real, measurable information that will directly help make the right decision at the end of the study.

Unlike developing a proper plan for the research, choosing an appropriate research method is also important. It helps in analysing the data in a more significant manner. Thus, in relation with this research, the researcher will be choosing both primary as well as secondary research methods. Both have equal importance in processing the research in an effective manner. The primary research will provide all the data and information first handed which means the data and information are used by any other sources. Researcher can use this research method for collecting data from the respondents with the help of a questionnaire (Li, 2021). Whereas, in accordance with the secondary method, the information gathered from books, journals and articles will demonstrate the empirical review in the literature review section of the report. However, the degree of the data gathered in this process will matter the most. In context with the justification of the research methods used, the researcher will be use mono-methods which means both primary as well as secondary for making the research more reliable and authentic in nature.

In sampling study of population has a significant role as it determines what the entire population is thinking about the determined topic. For example, in relation with the study, the study of population will demonstrate where there is any association between the variable such as trust of the investors and increase in the sales. The positive response in this context will assist the researcher in determine the appropriate results from the research (Bastos Lima, 2021). They are the people of Malaysia  who have interest in trading and out of total 100 population, 50 respondents has been chosen for completing the whole research study. The reason for choosing them as the respondents is they are investors who invest in the Malaysia crude oil trade at online platform.

Sampling frame is said to be a source of material that is used for choosing the sample size. In this a list is constituted and based on that is the sample from population is gathered. It is not possible to question every individual from the society so, sampling frame help the researcher in segregate the population on different parameters (Amaza, Mailumo and Silong, 2021). Thus, it is significantly used for selecting the right population for the research. Therefore, as a whole, the sampling frame is considered to be a database that provides with potential participants who can be questioned, and from them relevant answers can be obtained at the same time. However, the sampling frame could be qualitative and quantitate based on the degree or the nature of the topic. The sampling frame for this research is 50 individuals who have interest in online trading.  

In relation with the sampling technique, sampling is said to be a subset of the population from where the researcher gathers the viewpoints and information related to the research topics. There are various kinds of methods from which the researcher can choose the conduct the research in a more effective manner. By using sampling technique, the researcher can save time as well as cost because there are at times when the cost of the budget goes out of what it was discussed, thus, to have a control over the budget most of the researcher prefer the basic sampling technique. Moreover, with a predefined method the researcher effectively collects the data from the determined population. Looking more into the sampling technique it is of two types, probabilistic sampling and non-probabilistic sampling. Probabilistic sampling, where the subset of the population has equal chance of getting selection for the research. The biased approach in this sampling technique is overlooked in order to make the research more reliable and valid. Under probabilistic sampling there are three sub-categories i.e., simple random sampling, systematic sampling and cluster sampling (Arief et.al., 2021). Whereas, in relation with the non-probabilistic sampling, there is nothing like random sampling. There can be a possibility that the researcher has his/her preferred samples from where he/she wants to collect the information. Here some kind of biasness can be seen from the researcher’s side. Talking about the sub-category of this sampling method, these are convinced sampling, snowball sampling and judgemental sampling. Simple random sampling will be chosen for considering the research as it will help in managing and analysing the situation to consider an effective growth of the study population to provide data.

In context with research, the researcher will undertake random sampling which is one of the categories from the probabilistic sampling. With the help of this, the researcher will have an equal chance for selecting the respondents without favouring any of the categories.

The sample size for conducting this research will be 50, and for collecting information related to the behaviour of investors towards online trading platform will be sufficient. This number of data is related to whole research as the study of population will be 100 for considering research methods.

In accordance with this study the instrumental development process will include a structured questionnaire which will include some open-ended questions along with appropriate options. Thus, the respondent can select their options according to the choices and preferences. Research instrument is open ended questionnaire, it is developed with the help of online questionnaire form and derived through major sources and become applicable in the society.

Pretesting helps the researcher in determining whether the respondent is responding to any specific questions in an overly sensitive matter. Thus, in context with this research, pre-test will be conducted in order to know the circumstances. Data collected will be analysed so as to know whether the actual data collected and the population members are similar or not (Nurkhoiry et.al., 2021). It is useful for manage pre-test the modification and help the researcher to find effective outcome and gain consideration in more applicable manner.

The questionnaire that will be used in this research will be considered to be highly reliable and it is because the questions will possibly ask every detail relation to the palm oil industry (Thomas, 2021).

Validity is referring as the accuracy of the methods measured what it is supposed to be measured. This research will have high validity which means the collected information and the analysed results will correspond the real property of the research topic. 

There are many instruments of measurement items such as different scales, indexes, surveys, interviews, and informational observations. In this researcher, through survey the researcher will try to demonstrate examples of commonly asked questions so that a better understanding can be developed (Pereira et.al., 2021).

In this factor, both primary and secondary method of data collection will be taken into consideration as we have discussed in the above statements of the research methodology. It will be helpful for manage data and considered an effective growth and achieve more data application in more efficient way.

Data coding, is a process that helps in deriving codes from the collected data or the information. However, it is more applicable when qualitative form of data is being collected i.e., through observation, interview etc., but in context with this report as the information will be gathered through survey so data coding will be easier (Syed and McLean, 2021).

In order to do this research, the researcher will use quantitative data analysis technique. This means the collected data will be based on numerical data. Quantitative data technique can be considered as managing platform and manage sources to be considered in more analysis with higher efficiency and manage application (McCosker and Gerrard, 2021).

In this, the researcher will seek to analyse the quantified data and therefore, use the analysed data for representing it in a statistical form i.e., graphical representation. The researcher attempts not to mislead the information and representation in accordance with study ethics. According to the ethical principle, the researcher should communicate all the relevant information to the participant at an early stage so that the participant should be aware of the study project, and what is it purpose (Drachal and Paw?owski, 2021). 

The appropriate knowledge regarding the chosen issue is being gathered through research. When conducting research, the researcher employs a variety of techniques, with ethics occupying a prominent position among them. This ensures that the data gathered is accurate and that the individuals were not forced to participate. Anonymity, confidentiality, and informed consent are all elements of ethics (Östman and Öhman, 2022).

Research methodology will help the researcher in evaluating the results through various tools and methods. In this way, the researcher will be able to extract a valid conclusion from the information that are collected. Use of appropriate method is important because on wrong step while choosing the method can lead to negative consequences. With the help of research, investigator help in collecting data and manage chapter analysis with summary sources and considered through major analysis in more applicable challenges in the ethical consideration, data analysis and data coding with higher resources in more applicable challenges.

References 

Books and Journals

Agustin, I., Astari, M. M. T., & Rosmawati, E. (2021). Social media utilization in b2b marketing communications in palm oil plantation research services. Nusantara Jurnal Ilmu Pengetahuan Sosial, 8(6), 1791-1803.

Alii, H., Karimi, S., & Febriamansyah, R. (2021, May). Export performance and export competitiveness of Indonesia’s CPO industry with RSPO in China and EU markets. In IOP Conference Series: Earth and Environmental Science (Vol. 741, No. 1, p. 012073). IOP Publishing.

Alwi, S., Malan, I. N. B., Munirah, R., Yusof, H., & Aslam, N. A. M. (2021). Analyzing Systematic Risks Associated with Financial Engineering Commodities. Review of International Geographical Education Online, 11(7).

Amaza, P., Mailumo, S., & Silong, A. (2021). The Political Economy of the Maize Value Chain in Nigeria.

Arief, S. N., Antono, V., & Nurhasanah, R. (2021, February). Design and development of biomass gasifier reactor to produce syngas. In IOP Conference Series: Materials Science and Engineering (Vol. 1088, No. 1, p. 012083). IOP Publishing.

Baranidharan, S., & Sutha, A. I. (2021). Effect of Volatility and Causal Movement between Cotton Futures Price and Cotton Spot Price in Indian Commodity Market. Ilkogretim Online, 20(4).

Barrett, A. (2021). Forecasting the Prices of Cryptocurrencies using a Novel Parameter Optimization of VARIMA Models (Doctoral dissertation, Chapman University).

Bastos Lima, M. G. (2021). Bioeconomy in the Oil Palm Republic of Indonesia. In The Politics of Bioeconomy and Sustainability (pp. 147-177). Springer, Cham.

Cao, L., & Garcia-Feijóo, L. (Eds.). (2021). The Emerging Asia Pacific Capital Markets: Challenges and Opportunities. CFA Institute Research Foundation.

Chong, J. Y. (2021). The Emerging Asia Pacific Capital Markets: Malaysia. CFA Institute Research Foundation Briefs.

Drachal, K., & Paw?owski, M. (2021). A review of the applications of genetic algorithms to forecasting prices of commodities. Economies, 9(1), 6.

Kahar, P., Rachmadona, N., Pangestu, R., Palar, R., Adi, D. T. N., Juanssilfero, A. B., … & Ogino, C. (2022). An integrated biorefinery strategy for the utilization of palm-oil wastes. Bioresource Technology, 344, 126266.

Khatiwada, D., Palmén, C., & Silveira, S. (2021). Evaluating the palm oil demand in Indonesia: production trends, yields, and emerging issues. Biofuels, 12(2), 135-147.

Li, T. M., & Semedi, P. (2021). Plantation Life: Corporate Occupation in Indonesia’s Oil Palm Zone. Duke University Press.

Li, W. (2021). Contracts and Incentives in Environmental Sustainability. Stanford University.

Listiningrum, P., Bachtiar, R., Mahira, D. F., & Suwardiyati, R. (2021). Juridical analysis of policy concerning oil palm estate management in Indonesia. Legality: Jurnal Ilmiah Hukum, 29(1), 16-26.

Lubis, A. R., Prayudani, S., Fatmi, Y., & Lase, Y. Y. (2021, September). Measurement of Detection Rate Accuracy in Forecasting Crude Palm Oil Production using Fuzzy Time Series. In 2021 2nd International Conference on Innovative and Creative Information Technology (ICITech) (pp. 20-24). IEEE.

Maue, C. C. (2021). Climate, Agriculture, and Economic Development: Theories and Methods for Agricultural Productivity Analysis. Stanford University.

McCosker, A., & Gerrard, Y. (2021). Hashtagging depression on Instagram: Towards a more inclusive mental health research methodology. new media & society, 23(7), 1899-1919.

Mizik, T., & Gyarmati, G. (2021). Economic and sustainability of biodiesel production—a systematic literature review. Clean Technologies, 3(1), 19-36.

Nik Ibrahim, N. A., Ahmad Tarmizi, A. H., Selvaduray, K. R., & Kuntom, A. (2022). Sustainability and Traceability in the Malaysian Oil Palm Industry. In Recent Advances in Edible Fats and Oils Technology (pp. 425-461). Springer, Singapore.

Nurkhoiry, R., Azahari, D. H., Amelia, R., & Roosganda, E. (2021, November). Environmental effect of biodiesel mandatory policy. In IOP Conference Series: Earth and Environmental Science (Vol. 892, No. 1, p. 012093). IOP Publishing.

Östman, L., & Öhman, J. (2022). A transactional methodology for analysing learning. Mind, Culture, and Activity, 1-17.

Pereira, L., Santos, R., Sempiterno, M., Costa, R. L. D., Dias, Á., & António, N. (2021). Pereira Problem solving: Business research methodology to explore Open Innovation. Journal of Open Innovation: Technology, Market, and Complexity, 7(1), 84.

Reyseliani, N., & Purwanto, W. W. (2021). Pathway towards 100% renewable energy in Indonesia power system by 2050. Renewable Energy, 176, 305-321.

Rosyidi, I. M., Irianto, H., & Purnomo, S. H. (2021). An Analysis of Factors Influencing Indonesia’s Leading Agricultural Commodities Export to India. Caraka Tani: Journal of Sustainable Agriculture, 36(1), 135-143.

Sakai, K., Hassan, M. A., Vairappan, C. S., & Shirai, Y. (2022). Promotion of a green economy with the palm oil industry for biodiversity conservation: A touchstone toward a sustainable bioindustry. Journal of Bioscience and Bioengineering.

Snashall, G. B., & Poulos, H. M. (2021). Oreos versus orangutans: the need for sustainability transformations and nonhierarchical polycentric governance in the global palm oil industry. Forests, 12(2), 252.

Sukiyono, K., Asriani, P. S., Badrudin, R., Windirah, N., Yuristia, R., & Nabiu, M. (2022). Assessing Price Behavior of Tuna in Indonesia. Jurnal Ilmiah Perikanan dan Kelautan, 14(1).

Supono, S., & Yusuf, M. W. (2021). The Effect of Bacillus Coagulans as Feed Probiotics on Non-specific Immunity of Whiteleg Shrimp Litopenaeus Vannamei.

Syed, M., & McLean, K. C. (2021). Master narrative methodology: A primer for conducting structural-psychological research. Cultural Diversity and Ethnic Minority Psychology.

Thévenot, L. (2022). A new calculable global world in the making: governing through transnational certification standards. In The New Politics of Numbers (pp. 197-252). Palgrave Macmillan, Cham.

Thomas, C. G. (2021). Research methodology and scientific writing. Thrissur: Springer.

Yoesgiantoro, D., Fahrizki, J., & Supriyadi, I. (2021). Cost-Benefit Analysis of Palm Mill Oil Effluent Becomes Bio-CNG as HSD Fuel Substitution in West Kalimantan Province. Economics and Business Quarterly Reviews, 4(3). 

Online

An illustrated history of industrial palm oil.  2020. [Online]. Available Through: https://chinadialogue.net/en/food/illustrated-history-of-industrial-palm-oil/

Challenges faced by Malaysian Palm oil & the way forward. 2021. [Online]. Available Through: https://mpoc.org.my/challenges-faced-by-malaysian-palm-oil-the-way-forward/.