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This work is about the protection of individual investors at the Dar es Salaam Stock Exchange (DSE). The researcher focused on individual investor as a minority group, who invested less number of shares than institutional investors. The work aimed at checking the effectiveness of the laws and regulations at the Dar es Salaam Stock Exchange and how they guarantee investor protection. The research was conducted in Dar es Salaam city where the DSE and CMSA offices, the Securities brokerage firms and most of the individual investors are located.
The data was collected from DSE and CMSA legal departments through interviews of the officials. At the Securities Brokerage offices structured interviews were conducted to obtain primary data. Questionnaires were issued to Eighty (80) individual investors from different professions and specializations, five investors from each of the sixteen listed companies at DSE.
The researcher found that the laws on stock market guarantee investor protection but the major hindering factor is the application of the said laws on investors who do not have adequate awareness on their rights, on the prohibited practices, and even in reading the financial statements of the companies invested in. Further, the DSE and CMSA lack the adequate technology to detect the prohibited offences such as the insider dealing which limits the protection of the interests of investors.
The recommendations are to increase the awareness of the individual investor through the LDMs and brokers who deal with the investors on a day to day basis. There is also a need for improvement of technology to detect prohibited offences and facilitate in collection of evidence to prosecute offenders. |
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