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All share price and inflation volatility in Nigeria. An application of the EGARCH model

Author

Listed:
  • Lawal Isola ADEDOYIN

    (Landmark University, Kwara State)

  • Frank AWONUSI

    (Landmark University, Kwara State)

  • Martins I. OLOYE

    (Landmark University, Kwara State)

Abstract

This paper used EGARCH estimation techniques to analysis data sourced from 1985 to 2012 on the Nigerian economy to examine the ability of All Share Index to hedge against inflation in Nigeria. It relies on the Discount Cash Flow theory to examine this relationship. The results show that All Share Index provides a good platform to hedge against inflation in Nigeria. It is therefore recommends that investors on the one hand should adopt share pricing mechanism when hedging against inflation is in view. For policy makers on the other hand, policy that will advance the stock market should be put in place when controlling inflation is being pursued.

Suggested Citation

  • Lawal Isola ADEDOYIN & Frank AWONUSI & Martins I. OLOYE, 2015. "All share price and inflation volatility in Nigeria. An application of the EGARCH model," EuroEconomica, Danubius University of Galati, issue 1(34), pages 75-82, May.
    • Handle: RePEc:dug:journl:y:2015:i:1:p:75-82
    as

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    File URL: http://journals.univ-danubius.ro/index.php/euroeconomica/article/view/2726/2449
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    References listed on IDEAS

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