Abstract
At a time, the Nigeria Stock Exchange (NSE) is generally undergoing bearish trends; the paper investigated the performance of eighty-eight (88) sampled stocks, which were screened with the modern Price Earnings Growth (PEG) ratio into the Growth and the Value Portfolios. This is to ascertain whether the Value Portfolio outperformed the Growth Portfolio in terms of returns. From the researches in the developed and emerging stock markets, the momentum supports that the Value Portfolio outscored the Growth Portfolio in terms of returns. The paper explored pooled data from the Factbooks of the Nigerian Stock Market and the Annual Reports across different industries from 1990 to 2016. Descriptive methods and Arellano and Generalized Methods of Moment (GMM) xtabond2 were adopted to address the outliers, reverse causality and other related consequences of panel data. Similar to the findings from the developed and emerging stock markets, the study recognized that the Value Portfolio over-performed the Growth Portfolio in terms of returns in the NSE. Therefore, it is recommended that rational investors should show more preferences to invest in low-priced Value Stocks to earn higher returns than the high-priced Growth Stocks, which generated lower returns in the NSE.
Highlights
Stock investments are paper assets that guarantee claims on the issuer in the future period, investment in stocks promise variable future incomes (Jones, 2010)
The Nigeria Stock Exchange (NSE) is generally undergoing bearish trends; the paper investigated the performance of eighty-eight [88] sampled stocks, which were screened with the modern Price Earnings Growth (PEG) ratio into the Growth and the Value Portfolios
Despite the wide disparities between the maximum values of the Portfolios reported in Tables 1 and 2, the returns of the Value Portfolio captured with earnings per share of 1.39 and price earnings ratio (19.51) were more than earnings per share of 1.28 and price earnings ratio (12.51) of the Growth Portfolio
Summary
Stock investments are paper assets that guarantee claims on the issuer in the future period, investment in stocks promise variable future incomes (Jones, 2010). What is news is how to engage modern Growth and Value Portfolio strategies to construct winner portfolio at a time the prices of stocks are low-priced in the Nigeria Stock Exchange (NSE). During this period, investors were generally apathetic to investing in the market. Prices of stocks and high dividend yields (Zakaria & Hashim, reduced tremendously, investors in the NSE could 2017; Waistell, 2016; Pinkerton, 2015; Hirschey & profit from the market by engaging the Value or Nofsinger, 2008; Graham & Dodd, 1934; Buffett, Growth Portfolio strategy to invest in stocks that 1984). MATERIALS tio was engaged to screen the portfolios into the Value and Growth Portfolio to ascertain the exis-
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