Volatility in stock returns of nse listed companies around general elections in kenya

Abstract

The objective of the study was to examine volatility in stock returns of listed companies around general elections in Kenya. The study considered twenty companies out of the forty seven quoted firms at the NSE between1997 to 2007. Secondary data was collected from NSE database and analyzed using the GARCH model. The findings revealed that volatility in stock returns of Kenyan listed companies’ increases around general elections. Within this period investors are sensitive to the developing political landscape which then influences their decisions on whether to invest at the NSE or not. The study is in agreement with some local studies that portray general elections as having an impact on the stock returns of companies listed at the NSE.