This paper provides an empirical analysis of relationship between economic growth and its determinants with special focus on the stock market development in zimbabwe. Zimbabwe is one of the few countries that has come up with a special electoral. The main contribution of the paper is section iv, where the arbitrage pricing theory will be tested. The origins of the zimbabwe stock exchange date back to the arrival of the pioneer column in 1896. The reserve bank of zimbabwes functions came under the spotlight particularly after the appointment of mr gideon gono as the governor of the reserve bank late last year. The other responsibility a stockbroker has is selling stock on behalf of a client. The investors are able to invest in good securities and in case of any risk, it enables people to switch over. It is channelizing the savings of the people and making them available for investment purpose. Functions and characteristics of money cards, one copy for each group of two to three students printed on card stock and cut apart. The securities and exchange commission of zimbabwe was established through the enactment of the securities act chapter 24. It was however only operative for about six 6 years. It is convenient place where trading in securities is conducted in systematic manner i.
Zimbabwe stock exchange listings requirements page 3 of 7 related party transactions 20. Thus, the process started with the establishment of stockbrokers malawi limited sml with dual functions of a brokerage firm and. We discuss about major functions of stock exchange under these headings. The role of the zimbabwe stock exchange zimbabwe stock. There are two indices, the zimbabwe industrial index and the zimbabwe mining index. Its primary function is to provide a way to raise capital for national and international companies. Companies operating in zimbabwe have to satisfy certain legal and financial criteria before they can be listed or quoted on the stock exchange. The true forerunner to the zse of today was founded in bulawayo in january 1946, shortly after the end of the second world war. Functions of stock exchange main functions in the market. Each broker has a professional indemnity policy, that covers professional negligence, fraud and dishonesty by the employees. Examples of the popular listed companies are delta corporation, econet wireless zimbabwe, old mutual plc, first mutual holdings and masimba holdings. How to invest on the zimbabwe stock exchange startupbiz.
Stock exchange is an organized market for the purchase and sale of industrial and financial security. Factors influencing the zimbabwe stock exchange performance. Every major change in country and economy is reflected in the prices of shares. The effect of the stock exchange on economic growth. Aug 16, 2017 the role of zimbabwe stock exchange as an investment platform posted on august 16, 2017 by justin manyenyere in business, business buzz, financial, supplements post navigation. A commodity exchange is where goods that come from the earth, such as corn, soybeans, cattle, oil, silver, gold, coffee, and pork bellies are bought and sold among parties, frequently not just for investment purposes but for actual use in. Some of the important functions of stock exchangesecondary market are listed below. The latter, also founded in 1896, thrived on the success of local mining industry, but with the realization that deposits in the area were not extensive, activity declined and closed in 1924. The role of zimbabwe stock exchange as an investment. The fund is administered through the securities commission of zimbabwe with trustees selected from sec, zse, pension administrators and asset managers. The securities and exchange commission of zimbabwes key functions are. Pdf an event study of the zimbabwe stock exchange zse. Assignment of functions minister of finance and economic.
An act to confer powers and impose duties and restrictions in relation to gold, currency, securi ties, exchange transactions, payments and debts, and the import, export, transfer and settlement of property, and for purposes connected with the matters aforesaid. The zse assist institutions to raise long term capital through listing of securities as well as offer an investing platform through trading of listed securities. An empirical investigation of arbitrage pricing theory. Acts as a barometer of the wellbeing of the zimbabwean economy.
Who is secz securities and exchange commission of zimbabwe. Stock exchange also called stock market or share market is one important constituent of capital market. The platform allows one to place an order to buy or sell shares listed on the stock exchange. Stock exchanges help companies raise money to expand. The role of the stock exchange in the economy sapling. Stock exchanges play a vital role in the functioning of the economy by providing the backbone to a modern nations economic infrastructure. It plays an important role in the economic development of the country. Thus, the stock exchange is a unique yardstick to assess the industrial activity and investment opportunities of a country. The exchange has about a dozen members and over 65 listed securities. A complete list of all stocks traded on the zimbabwe stock exchange. Zimbabwe has a stock exchange zimbabwe stock exchange. Asked in zimbabwe when was zimbabwe stock exchange created. Zimbabwe stock exchange zse listed companies african.
Introduction to financial markets econ 308, tesfatsion. Just as in the case of buying stock, the stockbroker can only sell stocks of a client based on the account that a client signed up for. The role of zimbabwe stock exchange as an investment platform posted on august 16, 2017 by justin manyenyere in business, business buzz, financial, supplements post navigation. Section iii provides the methodology to be employed in this study. They also provide individuals the ability to invest in companies. Stock exchange is useful for the evaluation of industrial securities. The secondary market is in the form of stock exchange. A stock exchange is where pieces of ownership in businesses stocks are bought and sold among investors. Providing a ready market the organization of stock exchange provides a ready market to speculators and investors in industrial enterprises. Other stock exchanges were also established in gweru and mutare. Under section 5 of the securities regulation code, rep.
Even a country not known for having a sophisticated economy, like. Its history dates back to 1896 but has only been open to foreign investment since 1993. Zimbabwe stock exchange listings requirements page 2 of 7 g the issuer must produce a profit forecast for the remainder of the financial year during which it. This act may be cited as the exchange control act chapter 22. If a client has an executiononly account, the stockbroker can only sell a clients stock when asked to do so. Get share prices, volume traded, daily price movements and year to date percentage changes for companies listed on the zimbabwe stock exchange zse. The effect of the stock exchange, page 1 the effect of the stock exchange on economic growth. In the absence of adequate script, and with only government debt, the setting up of the mse followed a model already functioning in botswana. Moral hazard is said to exist in a market if, after the signing of a purchase agreement between the buyer and seller of a good, service, or asset.
The rise or fall in the share prices indicates the boom or recession cycle of the economy. Only stockbrokers and authorized dealers are allowed to transact in shares on behalf of the public. The main function of the nairobi stock exchange is to process corporate stock transactions. Section 3 of the act provides for the establishment of the securities and exchange commission which is the regulatory body for the securities and capital markets in zimbabwe. The stock exchange has been in existence since the end of world war ii. It was promulgated in 2004 and operationalised in 2008 the objectives, functions and powers of the commission are set out in section 4 and they are. An empirical investigation, page 3 the rest of the paper is organized as follows.
With the announcement of the new monetary policy in december 2003, the whole financial landscape in zimbabwe underwent an overwhelming transformation and indeed in some cases. Mar 07, 2011 importance or functions of stock exchange. Comparison of companies in the same industry is possible through stock exchange quotations i. The commission shall have the powers and functions provided by the securities regulation code, presidential decree no. This enables investors to know the true worth of their holdings at any time. Establishes prices for shares using the market forces of supply and demand. Powers and functions securities and exchange commission. There are two primary indices, the zse all share and the zse top 10. Define money as anything widely accepted as final payment for goods and services. A factor is anything that contributes casually to a result and drives a certain performance in an event wikipedia, 2008. The zimbabwe stock exchange, or zse, is the official stock exchange of zimbabwe. The first stock exchange in zimbabwe opened in bulawayo in 1896.
Every listed company in a stock exchange has to file documents in the stock exchange such as annual returns, and provide information regarding plans to merge with or acquire other companies, change in management, plans to enter into new businesses. Great strides have been made to align the market with international best practice, regulation being a key factor in investment decisions. The role of zimbabwe stock exchange as an investment platform introduction the zimbabwe capital market is the 4th in subsaharan africa by market turnover. Critical link they provide a critical link between companies that need funds to set up new businesses or to expand their current operations, and investors that have excess funds to invest in such companies. Jun 24, 2004 the reserve bank of zimbabwe s functions came under the spotlight particularly after the appointment of mr gideon gono as the governor of the reserve bank late last year. Implications for postdollarisation market efficiency article pdf available in mediterranean journal of social sciences 53 march 2014. Factors influencing the zimbabwe stock exchange performance 163 influence is basically causative factor that exert pressure on a person or events to drive them to perform in a certain way seyhun, 1998. About the zimbabwe stock exchange lyntonedwards stockbrokers. The act is the legal framework for the securities commission of zimbabwe, establishing it section3. A market for buying and selling shares, stocks, bonds. It thus, enables the public to buy and sell securities already in issue. The role of zimbabwe stock exchange as an investment platform. You may be surprised to discover the number of stock markets blanketing the globe. Any off market deals and any unethical criminal activities are dealt with within the framework of the rules and regulations governing stock market transactions in zimbabwe.
Stock exchanges provide order and impose regulations for the trading of stocks. Oct 02, 2017 zimbabwe has a stock exchange zimbabwe stock exchange. The following are some of the important functions of a stock exchange. The role of the zimbabwe stock exchange zimbabwe stock exchange. A stock exchange is a reliable barometer to measure the economic condition of a country. The role of the stock exchange in the economy finance zacks. The role of the zimbabwe stock exchange they serve three critical functions. A market for buying and selling shares, stocks, bonds as well as other second hand securities. The stock exchange provides assistance to the enterprises by creating avenues for selling shares and stocks to the public to generate fund. Stock exchange accelerates the process of capital formation. Assessment, one copy for each student objectives students will.
548 1371 1405 8 538 488 532 1033 1111 269 676 961 185 361 33 1277 507 371 1166 1645 392 1137 1044 1304 1452 1648 564 91 1424 215 1276 739 463 721