Risk and Return: The Case of Securities Listed on the West African Economic and Monetary Union Regional Exchange of Securities (BRVM)

Abstract

The purpose of this research is to study the relationship between risk and return on the BRVM. The empirical results, obtained using the Asymmetric Response Model (ARM) model, show the asymmetric nature of the return of the securities that are rated on them. This does not reflect the level of risk taken by investors, which is much higher than the return obtained. While this result is consistent with the distancing characteristics of risk and return observed in emerging markets, it highlights above all the need to rebalance the relationship between risk and return at the RSE in order to make it more attractive for investors.

Value at Risk and Market Risk: Case of the Regional Securities Exchange

“…Nevertheless, it provides a useful exercise for investors to determine the minimum capital required to protect themselves against risk. In the context of the BRVM, the banking sector, insurance companies and institutional investors play a major role in market animation (Essingone and Diallo, 2019). It is therefore entirely legitimate to refer to Basel regulations to define a portfolio risk management strategy in the WAEMU zone.…”

Trading Frequency Anomalies in Infant Markets: The Test for Returns and Sensitivity of Shares and Portfolios

“…In a recent study of African stock markets by Essingone & Diallo (2019) in West Africa Economic and monetary Union Regional Exchange of Securities, Asymmetric Response Model (ARM) was considered as an alternative model for CAPM in estimating risk. However, asymmetric nature of risk was still existed due to the lack of attractiveness of shares listed in, lack of speculative behaviour among investors, tendency of holding stock for long and fearing of getting loss.…”