Sections
Poll: UK military offer
Do you support UK's military assistance as a way of fighting militancy and smuggling in Niger Delta?
Investors warned to be careful on attendant risk in the capital market
Font size:
As the investment in the Nigerian capital market continued to grow in leaps and bounds, investors in that sector have been cautioned on the need to diversify their investment portfolios in order to reduce the attendant risk in the capital market.
An investment and portfolio analyst, Austin Ojei, who spoke at the induction ceremony of the new members of the Institute of Investment Management Research (IIMR) Nigeria, in Enugu, said a thorough understanding of the inherent risk in the capital market would help investors make prudent decisions in their portfolios of investments.
Presenting a paper titled: “Redefining, Measuring and Managing Uncertainty and Risk,” Ojei stated that an investor has an option of either investing in risk-free securities or diversify away by spreading his investments in many portfolios.
He however cautioned that in whichever way, there are risks that cannot be diversified as they are systematically inherent in the business, and that an investor has to determine the stocks that guarantee good returns to invest in.
The investment analyst identified Capital Asset Pricing Model (CAPM) as an instrument for assessing business and financial risks but equally cautioned that CAPM are limited by unrealistic assumption, difficulty in testing the validity of CAPM, and Betas not remaining stable overtime.
In his own paper titled: “Investment decision in a knowledge-based economy,” the deputy president of the association, Moses Egbo, said the adoption and application of computer/communication and other information technology have thus induced and generated an unprecedented degree of vibrancy in the various media through which information that aids investment decision.
An investment and portfolio analyst, Austin Ojei, who spoke at the induction ceremony of the new members of the Institute of Investment Management Research (IIMR) Nigeria, in Enugu, said a thorough understanding of the inherent risk in the capital market would help investors make prudent decisions in their portfolios of investments.
Presenting a paper titled: “Redefining, Measuring and Managing Uncertainty and Risk,” Ojei stated that an investor has an option of either investing in risk-free securities or diversify away by spreading his investments in many portfolios.
He however cautioned that in whichever way, there are risks that cannot be diversified as they are systematically inherent in the business, and that an investor has to determine the stocks that guarantee good returns to invest in.
The investment analyst identified Capital Asset Pricing Model (CAPM) as an instrument for assessing business and financial risks but equally cautioned that CAPM are limited by unrealistic assumption, difficulty in testing the validity of CAPM, and Betas not remaining stable overtime.
In his own paper titled: “Investment decision in a knowledge-based economy,” the deputy president of the association, Moses Egbo, said the adoption and application of computer/communication and other information technology have thus induced and generated an unprecedented degree of vibrancy in the various media through which information that aids investment decision.
Add to:
del.icio.us |
Digg
del.icio.us |
Digg
Email to a friend
Print version
Plain textRate this article
Comments (1 posted):
Post your comment