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Volume :2 Issue : 2 1988
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Kuwait Stock Exchange: A study of its Efficiency
Auther : Amal Eltigani Ali
This paper tests the weak-form efficiency of the Kuwait Stock Exchange. The notion of market efficiency is tested using the random walk method that examines the independence of stocks` periodic returns. The paper also computes the market index, the co variation of the returns of each stock, and the market and the efficient frontier. The test shows that the Kuwait Stock Exchange is not efficient. Causes of efficiency are presented together with recommendations to improve the market efficiency.