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Effect of Group Composition and Formalization on Financial Performance of Investment Groups in Kenya

Received: 10 April 2019     Accepted: 20 May 2019     Published: 12 June 2019
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Abstract

Investment groups are important for pooling of financial resources and lowering of investment risk. The issues, which affect their rates of return on investment, is however not fully known. The objective of the study was to analyze the effect of the group composition and group formalization on the financial performance of investment groups in Nakuru Town - Kenya. Descriptive survey design was used and stratified sampling technique was used to select a sample of 130 investment group members as well as investment groups. Data was analyzed using inferential statistics. The results shows that group composition and group formalization influence financial performance of investment groups positively and significantly. The study recommend that policies should be crafted that encourage gender mainstreaming in investment groups and registration of investment groups with members from different ethnic and occupational backgrounds. Training programs and member education on business skills and proper management practices are paramount in improving the financial performance of these groups.

Published in International Journal of Economics, Finance and Management Sciences (Volume 7, Issue 2)
DOI 10.11648/j.ijefm.20190702.13
Page(s) 65-73
Creative Commons

This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.

Copyright

Copyright © The Author(s), 2019. Published by Science Publishing Group

Keywords

Group Composition, Group Formalization, Financial Performance, Group Homogeneity

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Cite This Article
  • APA Style

    Rose Kirui, Samuel Onyuma. (2019). Effect of Group Composition and Formalization on Financial Performance of Investment Groups in Kenya. International Journal of Economics, Finance and Management Sciences, 7(2), 65-73. https://doi.org/10.11648/j.ijefm.20190702.13

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    ACS Style

    Rose Kirui; Samuel Onyuma. Effect of Group Composition and Formalization on Financial Performance of Investment Groups in Kenya. Int. J. Econ. Finance Manag. Sci. 2019, 7(2), 65-73. doi: 10.11648/j.ijefm.20190702.13

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    AMA Style

    Rose Kirui, Samuel Onyuma. Effect of Group Composition and Formalization on Financial Performance of Investment Groups in Kenya. Int J Econ Finance Manag Sci. 2019;7(2):65-73. doi: 10.11648/j.ijefm.20190702.13

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  • @article{10.11648/j.ijefm.20190702.13,
      author = {Rose Kirui and Samuel Onyuma},
      title = {Effect of Group Composition and Formalization on Financial Performance of Investment Groups in Kenya},
      journal = {International Journal of Economics, Finance and Management Sciences},
      volume = {7},
      number = {2},
      pages = {65-73},
      doi = {10.11648/j.ijefm.20190702.13},
      url = {https://doi.org/10.11648/j.ijefm.20190702.13},
      eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijefm.20190702.13},
      abstract = {Investment groups are important for pooling of financial resources and lowering of investment risk. The issues, which affect their rates of return on investment, is however not fully known. The objective of the study was to analyze the effect of the group composition and group formalization on the financial performance of investment groups in Nakuru Town - Kenya. Descriptive survey design was used and stratified sampling technique was used to select a sample of 130 investment group members as well as investment groups. Data was analyzed using inferential statistics. The results shows that group composition and group formalization influence financial performance of investment groups positively and significantly. The study recommend that policies should be crafted that encourage gender mainstreaming in investment groups and registration of investment groups with members from different ethnic and occupational backgrounds. Training programs and member education on business skills and proper management practices are paramount in improving the financial performance of these groups.},
     year = {2019}
    }
    

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  • TY  - JOUR
    T1  - Effect of Group Composition and Formalization on Financial Performance of Investment Groups in Kenya
    AU  - Rose Kirui
    AU  - Samuel Onyuma
    Y1  - 2019/06/12
    PY  - 2019
    N1  - https://doi.org/10.11648/j.ijefm.20190702.13
    DO  - 10.11648/j.ijefm.20190702.13
    T2  - International Journal of Economics, Finance and Management Sciences
    JF  - International Journal of Economics, Finance and Management Sciences
    JO  - International Journal of Economics, Finance and Management Sciences
    SP  - 65
    EP  - 73
    PB  - Science Publishing Group
    SN  - 2326-9561
    UR  - https://doi.org/10.11648/j.ijefm.20190702.13
    AB  - Investment groups are important for pooling of financial resources and lowering of investment risk. The issues, which affect their rates of return on investment, is however not fully known. The objective of the study was to analyze the effect of the group composition and group formalization on the financial performance of investment groups in Nakuru Town - Kenya. Descriptive survey design was used and stratified sampling technique was used to select a sample of 130 investment group members as well as investment groups. Data was analyzed using inferential statistics. The results shows that group composition and group formalization influence financial performance of investment groups positively and significantly. The study recommend that policies should be crafted that encourage gender mainstreaming in investment groups and registration of investment groups with members from different ethnic and occupational backgrounds. Training programs and member education on business skills and proper management practices are paramount in improving the financial performance of these groups.
    VL  - 7
    IS  - 2
    ER  - 

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Author Information
  • Faculty of Commerce, Egerton University, Nakuru, Kenya

  • School of Business, Laikipia University, Nyahururu, Kenya

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