IDEAS home Printed from https://ideas.repec.org/a/bjc/journl/v7y2020i9p278-285.html
   My bibliography  Save this article

Derivative Securities and Its Impact on the Nigerian Stock Market

Author

Listed:
  • Efanga, Udeme Okon

    (Department of Banking and Finance, Faculty of Management Sciences, University of Calabar, Nigeria)

  • Hanson, Uwem Effiong

    (Department of Banking and Finance, College of Management Science, Michael Okpara University of Agriculture, Umudike, Nigeria)

  • Ekanem, Boniface Christopher

    (Department of Insurance and Risk Management, University of Uyo, Uyo, Nigeria)

Abstract

This study was carried out to ascertain the impact of derivative securities on the Nigerian stock market between 2014 and 2019. Data employed for this study was elicited from Central Bank of Nigeria Statistical Bulletin of 2018 and Security and Exchange Commission statistical Bulletin of 2019. This study employed All Share Index and Market Capitalization as measure of productivity of the Nigerian stock market, while Foreign Exchange Derivative was employed as the regressor and Exchange Rate was employed as a controlled variable. This study employed Auto-Regressive Distributed Lag ARDL Model to analyze data. Inferential results pointed out that Foreign Exchange Derivative had positive impact on productivity of the Nigerian stock market within the period under review. The study recommended that monetary authorities in Nigeria should lay emphasis on the deepening of the Nigerian derivative market through the introduction and trading of derivative instruments such as swaps, options, futures and forwards amongst others as applicable in the financial systems of advanced countries. If this is done, the productivity of the Nigerian stock market would be greatly enhanced.

Suggested Citation

  • Efanga, Udeme Okon & Hanson, Uwem Effiong & Ekanem, Boniface Christopher, 2020. "Derivative Securities and Its Impact on the Nigerian Stock Market," International Journal of Research and Scientific Innovation, International Journal of Research and Scientific Innovation (IJRSI), vol. 7(9), pages 278-285, September.
  • Handle: RePEc:bjc:journl:v:7:y:2020:i:9:p:278-285
    as

    Download full text from publisher

    File URL: https://www.rsisinternational.org/journals/ijrsi/digital-library/volume-7-issue-9/278-285.pdf
    Download Restriction: no

    File URL: https://www.rsisinternational.org/virtual-library/papers/derivative-securities-and-its-impact-on-the-nigerian-stock-market/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Luyali Newton Chanzu & Mouni Gekara, 2014. "Effects of Use of Derivatives on Financial Performance of Companies Listed in the Nairobi Security Exchange," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 4(4), pages 27-43, October.
    2. Olawale Luqman Samuel, 2015. "The effect of credit risk on the performance of commercial banks in Nigeria," African Journal of Accounting, Auditing and Finance, Inderscience Enterprises Ltd, vol. 4(1), pages 29-52.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. S Manjushree, 2020. "A Derivative is a Risk Hedging Tool from Investor Perspective," Shanlax International Journal of Commerce, Shanlax Journals, vol. 8(3), pages 39-44, July.
    2. Oyegbile Akeem Bamidele, 2024. "Hedging with Financial Derivatives and Firm Performance of Consumer Goods Companies Listed on Nigeria Exchange Group," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(1), pages 2358-2373, January.
    3. Mohamed Rochdi Keffala, 2018. "Analyzing the effect of derivatives on the financial soundness of commercial banks in Italy: An approach based on the CAMELS framework," Review of Financial Economics, John Wiley & Sons, vol. 36(3), pages 267-283, July.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bjc:journl:v:7:y:2020:i:9:p:278-285. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Dr. Renu Malsaria (email available below). General contact details of provider: https://rsisinternational.org/journals/ijrsi/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.