AN EVALUATION OF SHARES AND SECURITIES DEALING IN THE NIGERIA CAPITAL MARKET (A CASE STUDY OF NIGERIA STOCK EXCHANGE FROM 2002-2006)
TABLE OF CONTENT
Table of content
1.1 Background of the study
1.2 Statement of the problem
1.3 Objective of the study
1.4 Scope of the study
1.5 Significance of the study
1.6 Limitation of the study
1.7 Definition of terms
2.1 Criteria for price determination (stock pricing)
2.2 Problem of Nigeria capital market
2.3 Criticisms against the Nigeria capital market
2.4 Survey of the present regulatory environment
2.5 SEC guidelines of issuing house
2.6 The role of underwriting organization in the capital market
2.7 Objective of the Nigeria stock exchange
3.1 Population of the study
3.2 Sampling method and size
3.3 Method of data collection
3.4 Method of data analysis
3.5 Historical background of Ilorin stock exchange (SEC)
4.1 Data analysis and presentation
4.2 Data analysis
4.3 Discussion of the finding
5.1 Summary of findings
1.1 BACKGROUND OF THE STUDY
The importance of a capital market as a catalyst to economic growth and development through its ability to mobilize surplus funds for investment purpose has long been realized. It is not surprising, therefore that countries all over the world strive to build a solid market with a variety of financial instrument and dynamic institutions capable of enhancing the “national wealth”.
A capital market exists to assist in the transfer of funds the excess units savers of the “deficit” units investment decision marker. Various types of institutions traditionally play one role or another in the process of transfer of funds. These include the stock exchange, issuing houses, stock brokers, share registrars, share distribution agent (e.g. merchant banks, issue companies, pension funds etc.) the Nigeria enterprises. Promotion bounds and the Nigeria security and exchange commission. Although all of these institutions perform one function or over in the transfer process, they are not located in one place. the capital market may therefore be defined as! The complex of institutions and mechanizing through which intermediate term funds are pooled and made available to business, government and individual instruments already outstanding are transferred (Dougall/Guramnitz 1975).
As distinct from the many market, the money market provides intermediate and long-term funds for individuals, business organizations, government (federal and state) most capital markets are well regulated and facilitators are so vital that efficiently and effectively. Referred to as market operations are issuing houses stock brokers, registrar’s investment advisers.
Financial intermediaries particularly banks and units trust also aid the movement of funds on the market.
Regulation is vital for the orderly functioning of any market. Lack of regulation could lead to general disorder, confusion, Loss of financial wealth and confidence, which will in turn have for reaching implication in the overall economy. It is for this among other reasons that regulatory agencies are setup to over see the market. The two regulatory bodies in Nigeria are the securities exchange commission (SEC) and the Nigeria stock exchange (NSE) it is important to distinguish the two at this point. While the security exchange commission (SEC) is a statutory body at the apex of the capital market, the Nigeria stock exchange (NSE) is a self-regulatory organization (SRO) under the supervision of the security exchange commission but with delegated power is to ensure smooth operation of the market. The exchange provides facilities for trained in secondary securities thus creating liquidity and ensuring easy transfer of securities in the market it also makes rules and regulations to guide the professional conduct of its member.
1.2 STATEMENT OF THE PROBLEM
Over the years, since the inception of the Nigeria capital market, there has been a lot of changes, growth and problem still facing the market. This study will focus on the changes and effects on the capital market.
1.3 OBJECTIVES OF THE STUDY
The aim of this research work is to:
1. Comparism will be made between the Nigeria capital market and it foreign counter parts.
2. The distinct role of the securities exchange commission (SEC) and the Nigeria stock exchange (NSE) could be assessed. Commission prior to the deregulation of the capital market and what is obtained at present. Also, since the capital market is a dynamic market of the economic, social and political environment of the country.
3. The study will assess the effect of deregulation on the market. This is been of any use?
4. To recommend based on the findings various method to improve the performance of Nigeria capital market.
1.4 RESEARCH QUESTIONS
i. what are the roles of capital market.
ii. What is capitals market
iii. What are the function of capital market
iv. What are the problem facing in stock exchange on evaluation of share and securities in Nigeria stock exchange.
1.5 RESEARCH HYPOTHESIS (HO/HI)
Ho: H2 the capital market have an effect on share and securities in Nigeria stock exchange
Hi: H1the capital markets have no effect on share and securities in Nigeria stock exchange.
1.6 SIGNIFICANCE OF THE STUDY
The study will provide explanations and reasons why most enterprises are still not quested on the stock exchange. also , the study will unified the situation of the capital market, it will identify how the governments, societies, public sectors and academics can benefits from it through the following points:-
i. To create wealth
ii. An alternative source of income for government especially.
iii. It secure retirement of old aged.
iv. Deduction in income tax
v. Capital appreciation.
vi. Rights to vote during annual general meetings.
Also, The study will offer suggestions on improvement the end of the research study based on my conclusion.
1.7 SCOPE AND LIMITATIONS OF THE STUDY
The study will make a fairs representation of Nigeria capital market especially Nigeria stock exchange (NSE) and security exchange commission (SEC) moreso, these are various formulated government policies that support growth and development of Nigeria capital market, but the study will in detail deal with those that concern and evaluation of share and securities dealing in Nigeria stock exchange.
An evaluation of share and securities dealing capital market for the purpose of the study and within the content of Nigeria stock exchange will include.
Criteria for prancing determination (stock princing), stock exchange market security exchange commission and deresalar the data analysis.
Time as in all human endure or placed the most serve limitation on the collection of data. Hardly is there any endeavor its dose of the challenging. Problem, there has so much difficulty in choosing the topic for this research. Also difficus was encountered in data collection.
Nigeria is notorious for lack of data bank and any effort to obtained data is very excruciating you are virtually forced to move from one source to the over in endless search for data sources. It commanded so much resources on many hours.
1.8 ORGANIZATION PLAN/ CHARACTERIZATION
Chapter one is introduction
Chapter two is literature review
Chapter three is research methodology
Chapter four is data presentation and data analysis
Chapter five is finding, summary, conclusion and recommendation and reference
1.9 DEFINITION OF TERM
Share: - A share is a fixed part of all company’s share capital the issue of a share certificate is prime farces evidence that the person named there on is the owner of the share set out in the certificate.
SECURITIES:- this is a document or certificate that is showing ownership of property especially bonds, stock and shares.
STOCK:- these could be referred to as shares in the capital of business company..