Analysis of investment strategies and financial performance of National Social Security Fund (NSSF) in Tanzania

Abstract

This study sought to examine investment strategies and financial performance of National Social Security Fund (NSSF) in Tanzania. Specifically, this study focused on in investigating the impact of investments in real estate and financial performance, analysing the impact of investments in capital markets in financial performance as well as examining the significance of purchasing public shares on financial performance. The following hypotheses were used to elucidate investment strategies and financial performance of NSSF in Tanzania. H0: investment in real estate, has no significancy impact on financial performance. H0: investment in capital market has no significant impact on financial performance. H0: purchasing of public shares has no significant impact on financial performance. The target of this study were only employees of the NSSF-Tanzania. Whereby simple random sampling was used to pick a representative sample of 150 respondents. Questionnaire, interview, and documentary review were methods for data collection. It was found that investments in real estate by NSSF has no direct relationship with financial performance, since, investment in real estates proved failure, the fact was that, one need to invest in profitable projects and for this to happen, a thorough feasibility study is of paramount importance in any investment. Basing on this factor therefore, hypothesis that states: “investment in real estate, has no significancy impact on financial performance” was accepted. It was found out that, investments in capital markets had no significant effect on financial performance, basing on this factor therefore, hypothesis that states “investment in capital market has no significant impact on financial performance” was accepted since, the calculated p-value was greater than the alpha level. In this study, it was further found out that, purchasing public shares found to have significant effect on financial performance of NSSF. Basing on this factor therefore, hypothesis that states “purchasing of public shares has no significant impact on financial performance” was rejected. Basing on the findings above, financial performance of NSSF is due to purchasing of public shares. It can also be concluded that, invest in real estates has led NSSF to prove failure due to poor investment plan. It is therefore recommended that, for successfully financial performance to occur, NSSF need to invest in profitable projects and for this to happen, a thorough feasibility study is of paramount importance in any investment