• Login
    View Item 
    •   SU+ Home
    • Research and Publications
    • Strathmore Institute of Mathematical Sciences (SIMs)
    • SIMs Projects, Theses and Dissertations
    • BBSA Research Projects
    • BBSA Research Projects (2014)
    • View Item
    •   SU+ Home
    • Research and Publications
    • Strathmore Institute of Mathematical Sciences (SIMs)
    • SIMs Projects, Theses and Dissertations
    • BBSA Research Projects
    • BBSA Research Projects (2014)
    • View Item
    JavaScript is disabled for your browser. Some features of this site may not work without it.

    A comparison of performance of unit trusts and the stock market in Kenya

    Thumbnail
    View/Open
    Undergraduate fulltext research project, 2014 (10.93Mb)
    Date
    2014
    Author
    Kahura, Kennedy
    Metadata
    Show full item record
    Abstract
    This paper seeks to make a comparison between the performance of equity unit trusts and the stock market. It answers two questions; whether equity funds are better performers than the market and whether the results obtained over the period of study are consistent with past conclusions of other researchers. Risk adjusted measures of return including Jensen's alpha, Sharpe Index and Treynor Measure are used in calculating the returns to be compared. Evidence from the results indicates that equity funds perform below the stock market unlike in a previous study by Kagunga that concludes unit trusts outperform the market. Raw returns analysis shows inferior returns across the equity funds industry compared to the returns from the market. Evaluating the same based on market adjusted returns simply emphasizes the fact that fund managers have not delivered superior returns relative to the market. In fact, there is only one out of ten funds that outperforms the market. It could therefore be concluded that equity fund managers should just manage indexed portfolios since they have not been able to beat the index. Further investigation could be done to see if the outcome is the same on including dividend yields before comparison is done. Our results question the value of engaging in rigorous investment strategies as opposed to passive; simply saving in high interest accounts or government papers for short term investment as well as long term since I year bond earns around 11% per annum with minimal deviation and 10 year bonds earn around 14%.
    URI
    http://hdl.handle.net/11071/5126
    Collections
    • BBSA Research Projects (2014) [26]

    DSpace software copyright © 2002-2016  DuraSpace
    Contact Us | Send Feedback
    Theme by 
    Atmire NV
     

     

    Browse

    All of SU+Communities & CollectionsBy Issue DateAuthorsTitlesSubjectsThis CollectionBy Issue DateAuthorsTitlesSubjects

    My Account

    Login

    DSpace software copyright © 2002-2016  DuraSpace
    Contact Us | Send Feedback
    Theme by 
    Atmire NV