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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)

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..............ORDER FOR COMPLETE PROJECT MATERIAL NOW!! .

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