Factors affecting the performance of the stock market: A case study of Nairobi security exchange

Abstract

The study seeks to establish the various factors that affect the performance of the stock market in Kenya. The main objective of this study was to analyze the institutional factors that affect the performance of the Nairobi Security Exchange. specifically the study seeks to ; assess the legal and regulatory framework of the Nairobi Security Exchange; testing the random-walk hypothesis , analyze the impact of the Information disclosure requirements of the Nairobi Security Exchange and to evaluate the effect of Transparency of transactions of Nairobi's capital market. Besides the study also look into the ability of the buyers to access the information at the stock market. The study will use descriptive sample survey to carry out research at the Nairobi security exchange. Both qualitative and quantitative techniques of data collection and analysis were used. The study focus on a sample of employees of Nairobi security exchange who include the jobbers, the brokers and the sellers and buyers on the market. The population of the players at the stock exchange is 450 and a sample of 100 people was used for the study. The study used the simple random sampling procedure to select the sample; however consideration was given to those people who have stayed on the job for at least three years. The conceptual framework of the study was guided by the research objectives and literature review of this study. Analysis was done from the computed percentages and frequencies. Both primary and secondary data were used in the study. Questionnaires were used to collect primary data and the reviewed literature was used to make deductions for that support the analysis. The research analysis was based on the research objective and questioner's items were presented by the use of tables, pie charts and graphs. This research is going to be beneficial not only to the players on the stock market but also to the prospective investors and the overall economic performance of the economy. The study concludes that there is need to have the effective information flow of the operations of the stock markets among the main players on the market