Browsing by Author "Dinga, Mackred."

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Effect of portfolio diversification on the financial performance of investment firms listed in the Nairobi securities exchange
(Stratford Peer Reviewed Journals & Books, 2020) Dinga, Mackred.; Kioko, Daniel M.
Investment involves a possibility of variation or deviation in the actual return from the expected return. The return of an investment is a major determinant of whether the investors will sacrifice their present resources or not. The investors are more interested in investments or securities that promise higher returns than those that promise lower returns. Portfolio management still remains as a science that does not give clear answers on the portfolio construction. This study sought to establish the effect of portfolio diversification on the financial performance of Kenya’s quoted investment firms. The specific variables were bond investments, equity investments, mutual fund investments and real estate investments on return on investments for the investment’s firms at Nairobi Securities. The theoretical framework was informed by portfolio theory, Black-Litterman theory and capital asset pricing model. The study adopted descriptive research design approach. The five listed investment companies at the NSE which formed the target population of this study and a census technique was used to select the five listed investment companies in the NSE. The study used secondary data that was extracted from the NSE and the websites of the respective listed investment companies. Data was collected covering 6 years from 2014 to 2019. Descriptive statistics was presented in mean, median, standard deviation while the inferential statistics included diagnostics tests and multiple linear regression model. The results revealed a negative and insignificant relationship between bond investments and return on investments for the investments firms at Nairobi Securities Exchange. There was a positive and significant relationship between Equity investments and return on investments for the investment’s firms at Nairobi Securities Exchange. Mutual Funds’ investments had a negative and insignificant relationship with return on investments for the investment’s firms at Nairobi Securities Exchange. Real Estate investments revealed a positive and significant relationship with return on investments for the investment’s firms at Nairobi Securities Exchange. The study concluded that bond investment has negative influence on the financial performance of investment companies listed firms. Mutual fund investment has a negative influence on the financial performance of investment companies listed firms. In contrast, Equity and real estate have a positive influence on the financial performance of investment companies listed firms. The study recommends that listed investments firms should invest more on the real estate compared to bond and mutual funds securities since real estate had higher significant effect on financial performance. The study further recommends that investment firms should maintain investment in equity so that to increase their financial performance, but they should invest less compared to the real estate investment. The management of the investment firms listed at the NSE should strive to improve the financial performance of their firms to enhance their firms’ equity returns. Based on the weak relationship on bonds and mutual funds with financial performance which is seen by regression analysis, the study recommends that investment firms should consider investing less on bonds and mutual funds given the same market conditions.
Factors affecting financial performance of pension schemes in Kenya.
(Stratford Peer Reviewed Journals & Books, 2022) Dinga, Mackred.; Oyoo, James.
The major function of pension funds is to provide ways for individuals to build up financial savings during their effective or working life in preparation for the funding of the consumption requires when they retire from active employment. Pension funds are the major sources of retirement income for many individuals worldwide. Despite the pension sub-sector growing, the faster growth in pension liabilities relative to assets as well as increasing life expectancy has elevated funding risks. In the defined contribution schemes, unremitted contributions have increased due to poor economic performance and the insufficient funding of quasi government schemes. This study sought to analyze the factors affecting financial performance of pension schemes in Kenya. The study specific objectives were to determine the influence of risk management, membership age, member contribution and firm size to determine their effect on the financial performance of the pension schemes. The study used 34 individual retirement benefits schemes registered with the Retirement Benefit Authority. The study used data for the period 2012-2021. The results revealed that there was a positive and significant relationship between risk management and financial performance of pension schemes. There was a negative and insignificant relationship between age of scheme members and financial performance of pension schemes. Member contribution had a positive and significant relationship with financial performance of pension schemes. Firm size revealed a positive and significant relationship with financial performance of pension schemes in Kenya. The null hypothesis on risk management, member contribution and firm size were rejected while that of age of the scheme members was not rejected. The study concluded that there is a strong correlation between risk management, age of scheme members, member contributions and firm size on financial performance of pension funds. The study recommended that pension funds should use the increasing value of their funds to generate returns for the pensioners. In addition, there is need to utilize assets to generate income for the pension funds and include the needs of the different age brackets in the management of the pension schemes.
The country by country ranking of pension systems in the world, a multiple discriminant analysis using data from the mercer CFA Institute’s global pension index 2021.
(IJRP, 2022) Dinga, Mackred.
This study examined the validity of the Mercer Global Pension Index using multiple discriminant analysis. The index data for 43 countries in the Index Report 2021 was obtained and a ranking score developed. The three predictors adequacy, sustainability and, integrity, which were individually composite variables, were analyzed to determine the extent to which they influence the ranking of the pension systems. The findings confirm that adequacy, sustainability and integrity of the pension system all have a significant influence on the ranking of pension systems in the world as provided in the Mercer Global Pension Index report of 2021.