| dc.description.abstract | The main objective of the study was to test the pre- holiday effect on stock market returns
at the Nairobi Securities Exchange. The stock market returns were computed for five
days before the holidays and five days after the holidays. The results were further
analyzed by calculating expected returns and subsequently computing the abnormal
returns. This study adopted a descriptive research design. The data used in this
studyconstituted daily stock returns of companies listed continuously at NSE from 1st
January 2010 to31st December 2013. Secondary data was obtained from the records at the
NSE for the fouryear period from 2010 to 2013. The data included daily prices and
market indexes from theNairobi Securities Exchange. The daily return for each firm was
obtained. An event study methodology was adopted to test the pre- holiday effect on
stock market returns at the Nairobi Securities Exchange. The finding indicated existence
of pre-holiday effect at the Nairobi SecuritiesExchange. In conclusion, consistent with
the existing findings, pre- holiday effect exhibited atthe Nairobi Securities Exchange is
accompanied by fluctuations in stock return. The presence of pre- holiday effect on stock
return indicate stock market inefficiency and therefore, NSE as a regulator of
Kenya’sSecurities market need to take steps in order to increase the informational
efficiency of the stockmarket operation. This will enable investors to reap fully benefits
of investing at NSE. | en_US |
