An Analysis Of The Relationship Between Risk And R

AN ANALYSIS OF THE RELATIONSHIP BETWEEN RISK AND RETURN OF LISTED SECURITIES IN THE NAIROBI STOCK EXCHANGE

1.0 INTRODUCTION

Stock Performance for the Period 2008 2009

In 2008, the first quarter of 2008 saw bottomdour turnover counterbalance by 10.2% compared to a similar period in 2007 partly as a result of preparations for the Safaricom IPO and the impact of repugn general elections results. Share volume on other change magnitude by 1092.93% from end of first quarter 2008 to end of sec quarter 2008. The NSE share index and Market Capitalization change magnitude by 7.05% and 57.5% respectively for a similar period.

The grade 2009 registered sundry(a) performance in secondary securities industry performance, as equities turnover declined by 45% to Kshs 57 one thousand thousand, from Kshs 103.5 billion recorded during the preceding period. Share volume however increased marginally to 4.26 billion from the previous years 4.26 billion, a 0.08% rise. Overall, the performance of the equity commercialize during the year was bear outish with the NSE 20 Index move by 36%. However during the second half of the year the market remained relatively bullish with the index closing at 3295 points compared to 3199 in January 2009, largely as a result of regenerate interest from foreign and institutional investors.





Problem Statement

Stock market plays an important role in stimulating economic growth of a country. It helps to channel fund from individuals or firms without investment opportunities to firms who guard them and thus improves the countrys economic efficiency. However, pullulate market is a volatile financial market, in which various factors can affect the return that investors can gain from investing in stocks. The uncertainty of reward from stock market is translated into risks that investors have to bear for investing in stocks.

Since the return from investment in stock market is uncertain, knowing the risk and return nexus in the stock market will be crucial for investors to maximize their return and...If you want to get a full essay, coif it on our website: Orderessay



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