The Influence of Emerging Capital Markets on Investment Portfolio Performance

Abstract

This study aimed to analyze the influence of emerging capital markets on investment portfolio performance, focusing on the Dar es Salaam Stock Exchange (DSE). Established as the principal stock exchange in Tanzania in 1996, the DSE has played a pivotal role in the country's financial landscape by facilitating the trading of various securities, including equities, bonds, and exchange-traded funds. The research employed a cross-sectional research design and a quantitative methodology to examine the relationship between market dynamics (such as liquidity and regulatory environment) and investment outcomes at a specific point in time. The study population comprised investors from 27 listed companies at the DSE, selected using a census sampling technique to ensure comprehensive data collection. Primary data were gathered through structured questionnaires distributed via email, capturing insights into investor strategies, risk perceptions, and responses to market conditions. Secondary data from annual reports and regulatory documents complemented the analysis, conducted using SPSS Version 26 for descriptive and inferential statistical analyses. The findings indicated significant correlations between market liquidity, regulatory frameworks, and investment portfolio performance within the DSE context. Despite these insights, limitations included data accessibility constraints and the study's reliance on a specific timeframe and market conditions. Nevertheless, the study underscores the importance of regulatory stability and market liquidity in shaping investor decisions and portfolio outcomes. Recommendations include enhancing market transparency, investor education, and regulatory frameworks to sustain market growth and attract more diversified investments. Further research is suggested to explore long-term market trends and the impact of global economic factors on emerging capital markets like the DSE.