Journal of Finance and Investment Analysis

A Study of Perceptual Factors Influencing Investors buying Behavior in Tanzanian Equity Market

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• Abstract

  The study attempts to ascertain the factors influencing buying behavior of Investors in DSE, Tanzania. Tanzania adopted a privatization policy in 1992 after recognizing that the state enterprises were becoming unbearable burden and the government was unable to sustain them. Despite the implementation of the government reforms and the establishment of DSE, Incorporated in the mid-1990s, the Dar-es-salaam Stock Exchange is a relatively new establishment compared to those existing in other parts of Africa. However, it has not been able to reach the masses as much as it should. In the United States of America, for example, the general population uses the stock markets as a means of savings and growing their wealth. In Tanzania, the majority of the population has no indication of what a stock market is and how it could help them. The study suggests that trading shares is the principal business activity for stock exchanges. Whether due to lax standards, poor supervision, weakness in the economy, loan problems have historically been the major causes of stock exchange losses and failures. Effective management of the equity market is fundamental to stock markets safety and soundness. Based on the study findings, it means that all listed companies should pay attention to several factors like quality management decisions, building brand, transparency in settlement issues. Specifically, companies should constantly review the interest rates and observe alternative companies marketing strategies to acquire better position in market.