Capital Market Structure And Development (A Case Study Of Nigerian Stock Exchange Nse)

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The Nigerian capital market is a long term end of the Nigeria financial system just as the money market is its short-termed in other words, the capital market performs for the economy, at the long-term end, the functions which the money market performs at the short-term end of the spectrum. Thus, while those who are short of funds and need to borrow for short-term propose borrow from the money market, those who are short of fund and are desirous of borrowing for the long-term go to the capital market, those who are short of fund and are  desirous of borrowing for the long-term go to  the capital market.

Similarly while those who have funds surplus to their immediate requirements and wish to lend or invest these funds for short-term periods do so in the money market, those who have such funds and to lend there for long periods invest or lend these funds to  capital market.

The regulation of financial markets and the liberation of economies capital flows in sere veal African countries raise a number of challenging issues. Policy makers and practitioners are concerned and involved with these issues. A vast set of issues concerns the setting up and designs of capital market operation (trading structures). This employs the philosophy of capital market building, the role of capital market (stock) market in achieving the overall financial objectives (auctions and dealership) choice for the relative competitiveness of emerging stock markets, connections between innovative in trading and regulations world market.

The Nigerian stock exchange has undergone a tremendous revolution over the years. After about 38 years of establishment, the Nigerian stock exchange can be said to have existed long enough to permit a capital look at its structure and development. The stock exchange long enough to permit a capital look at its structure and development. The stock exchange or its establishment was expected to provide appropriate machinery to facilitate further offering to stock and shares to the general public in the private sector of the economy, encourage the investment of savings so soon as it is clear that stocks and shares are readily available.

However, any doubt the importance of domestic capital market  in ensuring a balanced economic growth should have been dispelled following the experience of most countries since 1980’s. The chronic problems of national and corporate indebted have  driven the futility of combining  too much short term with too little long term equity.

Things have not been that œsmooth” for the Nigerian capital market as intended as at the time of establishment. There are some constrains in this sector. It is believed in some quarters of the economy that the Nigeria capital market is underdeveloped and has not shown substantial growth since  independence. And that shares are rarely traded and  prices do not reflect trading features of the listed  companies.

Also it is feared that the Nigeria capital market has œtoo many” things to do that it will be unable to develop it’s market structure effectively and efficiently.

This research project has the objective  of highlighting  the  Nigeria capital market structure and development. It looks at the capital market operations, the  key participants in the Nigeria capital market and to analyze the capital market structure in  aiding the development of the Nigerian economy.

In view of this, capital market operations, the need for stock exhcnage and the Nigerian capital make and capital structure and development thoroughly dealt with for analytic purpose.

This study will educate and expose ignorant business men and student to understand the operations of the NSE thus, widening the horizon of knowledge of the general public, especially the operations and policy makers of the capital market recommendations will in no small measure serve as guide towards improved performance.


Hypothesis is a conjectural statement of the relationship between two or more variables. They  are always declarative sentence from and they relate to either generally or specifically variable to variables.

Therefore, the following invalid and alternative hypothesis could help us to reach a more reasonable and unbiased end:
Ho: The NSE has not been performing a significant role in the Nigerian economy development.

Hi: The NSE has been performing a significant role in the Nigeria economic development.

This project is restricted to the study of Nigerian stock exchange, Lagos as a case study. And covered the period 2005 to 2007.

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