Personal factors influencing investing in capital market and stock exchange performance in Tanzania

This study sought to identify factors hindering individual investors from participating in capital markets in Tanzania mainly by focusing on the Dar es Salaam Stock Exchange. The aim was to realize the importance of the Motivation, Ability, Idea, Resources (MAIR) framework to the entire system of the Dar es Salaam stock exchange. It was necessary to know, the extent of this framework to individuals that have made investments. No studies have been conducted on investor participation in DSE. Hence there was knowledge gap that needed to be addressed. The study used the case study strategy. Questionnaires were used to collect data from different respondents and then analyzed by simple statistics. A sample of 200 individuals was used, 100 individuals as investors and the other 100 as non-investors to DSE. In due course, a statistical package known as SPSS was used in the analysis. The techniques for quantitative data analysis are frequency distribution and percentages, which were used to determine the proportion of respondents choosing the various responses Findings from study, revealed that personal factors influencing investment in capital markets include net annual income, return per capital invested, growth of earning and even past stock performances. Furthermore, poor marketing infrastructure, high interest rates and low savings seemed to be the main factors hindering investment in such markets. Results have implications to Policy and management. It is recommended that DSE should increasingly play an educational role and embark on a vigorous campaign to market itself and educate potential investors. Also encouragements of free flow of capital across borders through regional integration of capital markets in East Africa should be enhanced.