The Effect of Property Investment on Asset Growth of Pension Funds in Kenya
Abstract
The study addresses the effect of property investment on pension funds assets growth
in Kenya. Scheme trustees have a duty to ensure they invest the scheme assets
prudently and maximize returns. Hence a deliberate decision has to be made on
investment portfolio that maximizes the returns. Pension funds invest based on the
investments guidelines and the investment policy statements. Investment in real estate
offers considerable advantages for example it is a tangible asset with low volatility;
and it generates an attractive income stream and long term capital appreciation and
strong diversification benefits compared to stocks and bonds Investment in real estate
has been shown to reduce risk. Pension scheme schemes investment in the long run
with main goals being to preserve the member’s benefits and grow the funds. The
study assessed the effects of property investment on pension funds assets growth for a
period of 5 years between 2009- 2013. The analysis of the correlations results seemed
to support the hypothesis that each independent variable in property investment has its
own particular informative value in the ability to explain assets growth. The
significance of the coefficients was calculated at the level of 95%. The study findings
indicate that property investment variables are statistically significance to asset
growth as indicated by the positive and strong Pearson correlation coefficients. A
Pearson coefficient measure showed a strong, significant, positive relationship
between property investment and asset growth of pension schemes in Kenya.
Citation
School of Business,Publisher
University of Nairobi
Description
Thesis