Abstract:
This study was based on the effect of exchange rate changes on stock market returns. It
could be seen that exchange rate from the previous years have been increasing at a faster
rate, in the same way stock market returns has also been unstable. It was therefore to
determine the relationship between exchange rate and stock market. The study made use
of monthly data of Ghana stock exchange All-share index and exchange rate variable
from January 2007 through December 2015; to examine the extent to which exchange
rate variable influence the stock market returns both in the short run and long run with the
following test Johansen Juselius (JJ) co-integration test, Vector Error Correction
Model(VECM). The study establishes that there is long-run relationship between
stock market returns and exchange rate .It was also found that in the short- run,
there is a negative relationship between the stock market returns and the
exchange rate. The results provide some insights into the effects of exchange rate
on the stock market index in Ghana. This can help the policy makers and
investors in decision on planning and portfolio investment. It is also
recommended that investors consider inflation and foreign direct investment and
its performance.
Description:
A Dissertation in the Department of Management Studies Education, Faculty of
Business Education, submitted to the School of Graduate Studies, University of
Education, Winneba, in partial fulfilment of the requirements for award of the
Master of Business Administration (Finance) degree
