A COMPARATIVE ANALYSIS OF THE TRANSACTION COST AND RETURNS IN THE NIGERIAN MONEY AND CAPITAL MARKETS (A case study of stocks and treasury bills)
A COMPARATIVE ANALYSIS OF THE TRANSACTION COST AND RETURNS IN THE NIGERIAN MONEY AND CAPITAL MARKETS (A case study of stocks and treasury bills)
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Date
2011-08
Authors
AZEEZ, AKOWONJO OLATUNJI
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Abstract
Financial intermediation is believed to play a significant role in both developed and
developing countries. The economic significance of financial intermediation results from the
special role it plays in making contractual arrangement that link borrowers and lenders
efficiently. Every day in the Money and Capital Markets, individuals and institutions must
make important financial decisions. Lenders of funds must make decisions on when and
where to invest their limited resources, considering such factors as risk, marketability, and
expected return on securities available in the financial market place. This need to be able to
make a rewarding financial investment decision resulted in our attempt to carry out a
comparative analysis of transaction cost and returns in the Nigerian money and capital
market with specific focus on stocks and treasury bills. In doing this, we compared the
dividend yield yearly average to the treasury bills yearly average for the period between
1980 and 2009. We also carried out a survey to capture the impact of other factors such as
bonus shares, capital gain as well as right issues (which were not factored into the yearly
averages for treasury bills and stock returns). From the analysis, we found that though
transaction cost is higher in the capital market when compared to the money market, returns
is also higher during the post consolidation period (2005 – 2009). In addition, the research
also revealed that transaction cost is higher in the secondary capital market than in the
primary capital market.
Description
THESIS SUBMITTED TO THE POSTGRADUATE SCHOOL, AHMADU BELLO
UNIVERSITY, ZARIA IN PARTIAL FULFILMENT OF THE REQUIREMENTS
FOR THE AWARD OF MASTER OF SCIENCE DEGREE IN ECONOMICS
DEPARTMENT OF ECONOMICS
FACULTY OF SOCIAL SCIENCES
AHMADU BELLO UNIVERSITY, ZARIA, NIGERIA
AUGUST, 2011
Keywords
COMPARATIVE,, ANALYSIS,, TRANSACTION,, COST,, RETURNS,, NIGERIAN,, MONEY,, CAPITAL,, MARKETS,, case,, study,, stocks,, treasury,, bills,