| dc.description.abstract | ABSTRACT
Much of the previous research into stock market developments has delved mainly on the relationship
between stock market development and economic growth. Further, most of the research on impact of
stock market development on security returns has been in developed countries. Not much local study
has focused on the impact of stock market development on security returns. The study therefore,
sought to fill the lacuna by carrying out a descriptive research on impact of stock market
development on security returns. The research was conducted through an event study. The target
population of this study was all the companies listed at the NSE. The study utilized the historical
company share prices from the NSE, the firms’ financial statements and other data used in previous
research.
The data collected was analyzed using event study methodology. From the findings, the study
established that stock market development is crucial to the growth of security returns. It further
established that policies that enhanced involvement of foreign investors had the highest impact on
security returns followed by automation.
The study recommends that the existing stock market development including automation,
demutualization, regional integration, promotion of institutional investors, regulatory/supervisory
improvements, involvement of foreign investors and educational programs at the NSE should be
deepened and more others incorporated to bring about positive growth of the stock market which in
turn will impact strongly on the economic growth of Kenya. | |
