NAIROBI SECURITIES EXCHANGE INVESTORS WALK AWAY KSHS60BN RICHER IN 2014

An investor at the NSE trading floor during the opening of the Exchange Building in Westlands. FILE PHOTO | DIANA NGILA |  NATION MEDIA GROUP

Investors at the Nairobi Securities Exchange (NSE) closed last year Sh60 billion richer after the value of transactions rose by 38 per cent.

In 2014, investor wealth in the equity market increased to Sh215 billion, a 38.51 per cent jump from Sh155 billion that was made in 2013 from the sale of shares at the bourse.

This is an indication of the high returns risk investors expose themselves to when pumping their money in the stock market.

Trading volumes rose to 8.1 billion shares up from 7.6 billion shares posted the previous year. Market capitalisation stood at Sh2.3 trillion against Sh1.92 trillion posted at close of year 2013.

Last year, other asset classes like treasury bills and bonds earned an average of between 8 per cent and 12 per cent. Investors who put their money in the fixed income market earned an average of 6 per cent for their investments. 

Analysts, however, say that investment on the stock market calls for a higher appetite for risk and patience compared to some other investments that are relatively low risk but have a low return.

CLOSED YEAR HIGHER

The NSE 20 Share Index, which is the benchmark index on the performance of the market, rose by 3.77 per cent to close at 5112.65 points from a 4926.97 points posted at the at close of  2013.

The bond market closed the year 9.09 per cent higher at Sh494 billion against Sh453 billion posted the same comparable period.

Some of the counters that registered significant gains include Safaricom, EABL, KCB, Equity Bank, Centum, Unga Group, Britam, Jubilee, NSE, CIC Insurance, BAT, Housing Finance and CfC Stanbic.

CREDIT SOURCE: NMG