Macroeconomic Variables, Sectoral Index Volatility, and Investor Sentiment among Listed Firms at Nairobi Security Exchange, Kenya
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Date
2022
Authors
Baariuanddr, Mungiria James
Ambrose Jagongo
Journal Title
Journal ISSN
Volume Title
Publisher
International Peer Reviewed Journal and Book Publishers
Abstract
Purpose: From a broader perspective, it is
generally accepted that every investor aims
to maximize return on their investment. To
achieve this, the security market has
significantly attracted so much interest from
numerous stakeholders around the globe.
However, it is difficult to forecast the stock
index volatility exhaustively since it is
triggered by different factors, which erode
the investors’ confidence. The impact of
volatility in the stock market is not the same
(Liu et al., 1998), and it is transmitted from
one sector to the other. Therefore, this study
seeks to establish the relationship between
the selected macroeconomic variables
sectoral index volatility after introducing the
moderating effect of investor sentiment.
Methodology: This review employed
Systematic review research design to trace,
gather and appraise relevant studies that
address the relationship between the
dependent and independent variables.
Findings: The outcomes of the study review
the existence of a conceptual framework gap
as empirical literature does not offer
conclusive results on the sectoral index
volatility and how it is influence by
macroeconomic variables and investor
sentiment. Previous studies were majorly
conducted at a different time period in other
markets presenting a geographical gap, and
without factoring sectoral perspective.
Unique contribution to theory, practice
and policy: The study will be beneficial to
investors in portfolio formation for
diversification purposes. The models
developed from this study will aid the capital
market authority and government to regulate
listed firms in Kenya to develop policies that
minimizes return volatility. The study will
add new knowledge on sectoral index
volatility to maximize market returns for
listed firms in Kenya.
Description
Article
Keywords
Macroeconomic Variables, Sectoral Index Volatility, Investor Sentiment
Citation
Baariu, M., & Jagongo, A. (2022). MACROECONOMIC VARIABLES, SECTORAL INDEX VOLATILITY, AND INVESTOR SENTIMENT AMONG LISTED FIRMS AT NAIROBI SECURITY EXCHANGE, KENYA. International Journal of Finance and Accounting, 7(1), 61-75.