Estimation of market risk for the main investment market segment of Nairobi Stock Exchange

Abstract

This Project paper applies a model for estimating market risk by use of beta coefficients.A Beta table is built using secondary data from companies listed in the Nairobi Stock Exchange Main Investment Market Segment. The market risk is measured by comparing movements in the return of an individual asset to movements in the return on the market as a whole. The model estimates two variables. 1) The return on an individual asset 2) The return on the market as a whole. Conclusion based on the empirical results based on a linear model is drawn.