Question
You just graduated with MBA in Accounting and Finance from the University of Professional Studies and are employed by JEK Investments Ltd, a brokerage firm
You just graduated with MBA in Accounting and Finance from the University of Professional Studies and are employed by JEK Investments Ltd, a brokerage firm in Ghana. Kweku The Don, an illiterate businessman, visited your firm for a piece of investment advice and possibly make some investments. Although an accomplished businessman, he was advised by hisson to buy some shares on the Ghana Stock Exchange in other to diversify his portfolio. Your boss has asked you to consider either Cronox Industries or Zealous Incorporated The share prices and dividends for the two companies and the returns on the Ghana Stock Exchange are shown below for the period 2016 2021.
| Cronox Industries | Zealous Incorporated |
| ||
Year | Stock price | Dividend (GH) | Stock price | Dividend (GH) | GSE Returns (Market Returns) |
2016 | 7.62 | - | 55.75 | - | - |
2017 | 12 | 0.90 | 60.00 | 2.25 | 0.07 |
2018 | 10.75 | 0.95 | 57.25 | 2.50 | 0.12 |
2019 | 17 | 1.00 | 48.75 | 2.75 | 0.08 |
2020 | 15.75 | 1.06 | 52.30 | 2.90 | 0.23 |
2021 | 17.25 | 1.15 | 48.75 | 3.00 | 0.18 |
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