Indonesian Traditional Music with Modern Music Essay

My name is Heru Sulaksono , I’m standing here today because I want to tell you all about Indonesian Traditional music call â€Å" Keroncong† . The history of Keroncong music itself was started when the Portugese invaded Indonesia in the 16th century, this music was first introduced by the sailors and the slaves on the portugese ship as known as â€Å"Fadu†. But weakening Influence of the portugese in the 17th century did not make â€Å"Keroncong† disappear from Indonesia. This music just continued to grow in Indonesia. In the early 19th century some Indonesian traditional instruments were introduced and influenced this music like the Seruling and Gamelan. The Golden age of â€Å"Keroncong† Music ended in 1960 due to introduction of rock music to Indonesia . Even with this music beginning to disappear, Keroncong music is still played and listened to but most of the listeners are old people in Indonesia. But in the 21st century the young generation of Indonesia ,is making many new breakthroughs to save Indonesia’s traditional music and make it known to the world, for example Bondan Prakoso Ft Fade2Black made a song titled â€Å"Keroncong Protol†, this song combines â€Å"Keroncong† With â€Å"Rap† and â€Å"Rock† the result of this combination is good music that everybody can listen to. This type of breakthrough can preserve Indonesian traditional music like the â€Å"Keroncong†. So the moral message that I want to tell you about is how the young generation of any country should be working to preserve their country’s traditional music. Every nation has its own traditional music, just like Indonesia, and everywhere in the world traditional music is disappearing. every young generation I think likes modern music better than traditional music. They think it’s not cool to sing traditional music or to like traditional music. Hey! It’s not that bad. f we want to preserve our traditional music it means that our next generation can hear that music. Even if you really like modern music it’s doesn’t mean you can’t preserve your nation’s traditional music, because there are so many innovations that can be used to preserve traditional music, like combining traditional music with modern music. This is just one of the innovations, that lets us save our traditional music! , so that is the message that I want to `tell to all of you, thank you for your attention,wassalamualaikum wr wb good morning.

The Impact of Daycare on Infants

55% of American mothers now return to work by the time their children are one years old — out of either financial, professional, or personal necessity. In today’s society, there are concerns as to whether attending daycare during infancy produces negative or positive effects on the development of children. Many of these concerns are influenced by the fear that separating an infant from its mother may cause emotional harm to the child or disrupt the mother-infant bond. No study finds that children of employed mothers suffer solely because their mothers are working. Research has shown that mothers who work spend as much time playing with their babies as do mothers without outside jobs (Huston & Aronson, 2005). It has also been questioned as to whether home-based maternal care or nonrelatives day-care provide the child with more opportunity to develop cognitively and socially (Belsky and Steinberg 1978, Field 1991, Lamb 1996, Peisner-Feinberg et al. 2001). There has been research that has found positive effects of day-care on children’s social and cognitive development and suggests that perhaps child-care centers encourage more social interaction than the environment of a home-reared child. There may be more stimulation in day-care and more communication and sharing to be learned, therefore enhancing these abilities of the children who attend them (Peisner-Feinberg et al. 2001). Evidence shows that a good preschool education is beneficial to young children. Children who attend preschool have a head start when they begin elementary school having learned basic concepts in a preschool center. Some of the negative effects a child may experience while attending a child care center include high child to adult ratios, insufficient materials and equipment, staff with inadequate training and experience, and caregiver burnout. There are truly some wonderful and caregivers and daycares out there. Choosing the best one is a very important decision that a parent has to make. How Do You Choose A Good Day Care Center Choosing a day care center is one of the more important decisions parents can make on behalf of their child. While it may be tempting to be swayed by a center based on rates, location or even decor, there are several other factors to consider. When visiting a center there are several questions one can ask the director of the facility to determine if it’s the right one for your child or if you should keep looking (Maughan, 2008). 1. What are the operating hours of the facility 2. How are the children grouped in classes 3. What is the teacher to child ratio for each class 4. What is the centers check in and check out procedures 5. What is the centers policy on disciplinary action for children In addition to these questions a parent should tour the facility and go over the safety procedures for the facility. Word of mouth is also a good resource. Talk to family and friends and find out if and where their infant went to daycare. What would you tell a parent of an infant who is concerned about harming their baby by placing them in Day Care, but must work because of economic necessity? I would tell a parent who must place there infant in daycare to not worry. It won’t cause any harm to their child. As long as they put them in a good quality childcare facility the infant will be ok. The important thing for the parent is to do there homework ahead of time when looking for a facility. The parent can call the facility to see how there child is doing throughout the day. Some facilities even have cameras so the parent can actually see what there child is doing. This may ease the parents mind throughout the day so they won’t be so worried about what is going on with their child. According to the NICHD daycare seems detrimental only when the mother is insensitive and the infant spends more than 20 hours a week in a poor quality program (NICHD, 2005).

Analysing The Emerging Democracy Of South Africa Politics Essay

Analysing The Emerging Democracy Of South Africa Politics Essay South Africa is a young democracy that has begun making serious attempts to bring the nation together and create national equality among the people. First to understand what a democracy is it needs to be defined. William Hay Anthony defines democracy as â€Å"liberal representative government under law, sustained by a political culture that accepts open disagreement and demands accountability† (Anthony, pg 135). This definition highlights â€Å"the role of institutions in making a political order work† (Anthony, pg 135). Applying this definition to the South African case is important to analyzing its development within being a democratic nation. Civil and political rights are important to a democratic nation because it must maintain rights to all of its citizens equally. South Africa has made huge steps in ensuring equal rights to all of its citizens, though it is quite clear that a lot more could be done. In terms of economic rights and social rights, South Africa has made attempts in making these rights equal for everyone. The democratic role of South African political parties has been a constant one. The African National Congress has been the party in power of the state since its first democratic election in 1994 and it seems like it is getting more and more support as time goes by. Their policies which have been put forth have the same goal of having equality within the state. In the past 16 years, South Africa has made numerous attempts to make its nation more democratic but it is clear that the work that the nation must do to have a complete democracy, is nowhere near finished. Rights have not always been equal to all people of South Africa throughout history, even in the past 20 years. From 1948- 1994, South Africa was under an apartheid, that is, a segregation of blacks and whites in all aspects of society. Under this rule, all races that were identified by the South African Government were divided. At the time, the government recognized four different racial categories: â€Å" African, coloured, Indian and whiteâ€Å" (Lichbach 2009, 466). There were many laws that were put in place to keep the people of the country segregated at all times; the only exclusion to that was if a black African was working for a white one. Some apartheid laws were the â€Å" Group Areas Act, Land Acts, Population Registration Act and Reservation of separate Amenities Actâ€Å" (Lester 1996, 227). During the apartheid, because coloured people could not vote or own property, they were living in extremely poor conditions and kept in certain black only areas. Even when coloured people could own land, the qualifications amount was raised too high for many coloured people to even consider attempting to purchase land. (Maphai 1994, 3). Without the ownership of property, one could not vote. When the first democratic election was held in April of 1994, it marked a new beginning in South Africa; some called it the â€Å"New South Africa†. Mandela was named as president and many apartheid laws were abolished. People were becoming more equal within this country which meant people of all the coloured races were lawfully allowed to integrate with their white counter parts in education, work, property ownership and other rights that were not given to them before. With a new government set in place, citizens were excited to see how their country would change for the better given its new democratic policies that would soon begin to be in effect. What some people don’t fully understand is that many things like becoming a new democracy take time, especially when dealing with a country with a past like that of South Africa. With that being said, even though these wonderful laws were being put into government, they were not exactly being implemented very well. One of the biggest reasons why so many of the country’s people have to live this way is because of the huge inequalities within the country; â€Å" Ine quality is still higher than anywhere else in the worldâ€Å" (Pons-Vignon 2008, 3). Inequality is something that cannot be changed overnight with the passing of different laws; it is something will be an ongoing struggle for the country. Something that is special with the democratic characteristics of South Africa is the fact that the minority of the country has most of the power; white people are the clear minority of the population but they clearly have the most power. In 1980, it was shown that â€Å" whites, who were one sixth of the population, earned two thirds of total income in the countryâ€Å" (Maphai 1994, 137). Because white people have such great power as a whole, it is more difficult for other citizens of the country to rise economically. Since 1994, the only place that whites do not have the most power is in government. The Party that has been in power since the liberalization movement has been the black- led African National Congress or ANC. When it comes to voti ng, which many black people do have a right to now, whites just cannot even compare with the numbers that the Blacks have; in 2001, â€Å"79 percent of the population classified themselves as African, 10 percent as white, 9 percent as Coloured and 2 percent as Asianâ€Å" (Lichbach 2009, 472). The fact that government is led by a black supported party is not unfortunate for most white people. In the early 1990’s, the ANC adopted many policies and went through many negotiations with the National party (NP) to get more support from the white community. With the attempt that the ANC made toward getting support from white people in the country, white people began to see the ANC more like a rival as rather than an enemy. (Maphai 1994, 75) As well, the leaders of the ANC have done a good job in convincing all people, including whites, that their policies will only help to better the country. Unions are also helpful with making a nation more democratic. The ability to have specifi c rights because of employment is a huge factor in having equal rights for people. It was 1979 when African Trade Unions were finally recognized and the Congress of South African Trade Unions was then formed in 1985. (Lichbach 2009, 477) Recognizing unions that were made up of Black workers was essential in implying that they, as workers within the state, deserve no less than that of white workers. Unions allow a group of workers to negotiate with their employers about better wages and working conditions. In the aspect of civil and political rights, South Africa is making a clear progression towards truly having equality within those rights. Democratically, South Africa is making a big progression towards effectively having equal political and civil rights for all of its citizens. Through the coming years there should be more polices out being put into effect and hopefully a better understanding of equality among races. It is only then that the rights that are actually listed within the South African law will have been respected and truly put into practice.

Competitive Advantage Research Paper Example | Topics and Well Written Essays - 1000 words - 1

Competitive Advantage - Research Paper Example From the essay it is clear that competitive advantage is likely to be achieved through different avenues that include the offering of superior quality products or services. Some of these practices involve the lowering of prices as well as raising the efforts in the market. A competitive advantage that is sustainable is one that maintains a favourable position above others over a long period of time which is vital in boosting its image in the marketplace. Furthermore its valuations together with future earning potentials are also put into consideration. As the discussion stresses competitive advantage is divided into two, namely comparative advantage (also known as cost advantage) as well as differential advantage. Comparative advantage is the capacity of producing good products or services at lower costs that business rivals. It gives a business firm the propensity to selling goods along with services at relatively reduced prices in comparison to the competition or generating large sale margins. Differential advantage on the other hand is founded when the products or services of a firm differ from those of the competitors and are perceived as better compared to those of the competitors. Organizations in high PDs are centralized with strong hierarchies and big gaps in terms of compensation and authority, while low PD places supervisors as well as employees are seen as equal. In the former, it is important to acknowledge authority of leaders and the latter requires one to employ teamwork.

Common Biases in Self-perception Essay Example | Topics and Well Written Essays - 1000 words

Common Biases in Self-perception - Essay Example 387). People reactions in situations originate in the very perceptions. In order to change people’s reactions and responses to the challenges of everyday life, it is imperative that biases in self-perception, factors governing the self-perceptions, people’s tendency and willingness to change their self-perceptions for the better, and possible ways to achieve this are explored. A very common misconception about the perceptions is that they are passive and are created as a result of an individual’s recorded information about the subject from the past experience. In reality, perceptions are active and create reality rather than recording it depending upon an individual’s response to the stimuli (Curry, Meyer, and McKinney, 2006, p. 28). Self-perceptions play a big role in the quality of performance of an individual. Yammarino and Atwater (1993) proposed a model according to which accurate self-perception leads to better individual and organizational outcomes whereas inflated or deflated self-perception leads to diminished or mixed results respectively. The behavior and psychology of an individual is different when he/she is working as part of a group from when he/she is working alone. Generally, people tend to have self-serving biases when they are being part of a team. They tend to take credit for the team’s successes while indulge in a blame-game to avoid the responsibility of failure (Taylor and Doria, 1981, p. 210). Factors that help an individual carry accurate self-perceptions include but are not limited to high self-esteem, knowledge, and good critical analysis skills. Reifenberg (2001, p. 627) found that people who make good judgments about their performance have higher internal attributions than others whose judgments are not quite as good. Lack of the skill to respond accurately to particular situations at hand arises from lack of people’s awareness of their lack of ability to differentiate between the accurate a nd inaccurate response to the very situations. This essentially means that rather than being ignorant of their lack of skill to respond accurately, such people are ignorant about their ignorance. Instead of realizing their deficiencies, these people tend to overestimate their skill of responding in the right way thinking there is no problem all which is how their ignorance works. People with low talent are more optimistic about their performance as compared to the people with high talent. Indeed, the latter are slightly pessimistic about their performance not because they underestimate their own skills, but because they tend to overestimate the skills of others, whereas actually others are not as good at responding in the right way as they are. On the other hand, the optimism of the people with low talent originates in their lack of knowledge, thus causing them more trouble with their metacognitive judgments. Failure of these people to realize their incompetence is because of the fa ct that they are doubly cursed in that they are not only unable to make the right response but are also unable to differentiate between the right and wrong response. â€Å"[I]ncompetence means that people cannot successfully complete the task of metacognition, which, among its many meanings, refers to the ability to evaluate responses as correct or incorrect† (Dunning et al., 2003, p. 85). Others’

Formal Report Assignment Example | Topics and Well Written Essays - 1500 words

Formal Report - Assignment Example Business Transportation Services Co. Ltd. has a proven track record of providing transportation methods that are both affordable and efficient. We have a huge fleet of cars which cater to our customer’s need as and when it is required. We provide the best solutions. We guarantee to meet or beat the price of any other carrier. Just show us your current contract and we’ll show you how we can do better. We are a Pacific Northwest regional carrier, so our drivers know the area and are not as fatigued as long-haul carriers. We have a variety of trailer sizes and types, so odds are good that we can always provide you with dedicated runs from pickup to delivery at your facility, instead of less-than-truckload (LTL) runs that must make stops for multiple customers. At Business Transportation Services, the client satisfaction sits on top of our lists. Our fleet of cars have been specifically numbered keeping in mind the large number of clients we cater to. Discussing of Findings : Business Transport Consultancy has a fleet of cars which can be sent at any time. We have done some interesting research and found out that quite often, companies have to go through the following problems: 1. Fuel Cost 2. Car Effeciency 3. Labour Charges Let’s deal with the first problem right now. As mentioned before over here the fuel is the most important issue. To tackle the fuel cost issues, we have further divided the proposal into 1. Cost Saving 2. Efficiency So, in the purview of dealing with the high rise fuel costs, the first step is to understand cost saving. How can we do cost saving? The answer lies in managing the fleet of cars only when their requirement happens to arise. We provide quick and fast solutions whenever our clients have to transport their goods from one place to another. At our company, we provide our clients with the best solutions catering to their time and need. In the field of fast moving business, one cannot rely on renting the transport, bu t we go much further than just providing for rental solutions. The way we operate is that we provide our customers with an option to run our vehicles at any given time. You can chose from a range of vehicles which we have to provide your suitable needs. However, it must be kept in mind that the vehicle you chose is efficient in managing its fuel consumption. For you, the best strategy at this time in order to avoid the fuel consumption issues would be to hire or rent for purchase depending upon the user ability of the vehicle. Since you had 10 SUVs earlier to manage you daily transport needs, we have got down that figure to five high capacity vans which have special cabins for housing the maximum amount of goods. The per ton capacity of this high capacity van far outreaches the number you would have attained with a normal SUV. The petrol efficiency arrived at is less than the SUV, but since you can carry more goods, the overall ratio has drastically improved. Now, when we looked at the date and compared the fuel efficiency, we found out that in engaging 10 SUVs you were spending close to 40 USD on a barrel. However, once you start using our high capacity vans which have been specifically designed and built for carrying lots of goods and in the most efficient way, you realise that the fuel consumption for every journey goes down to 20 USD a barrel. That’s a drop of half the price. This is a remarkable stat as it provides us with the correct way of dealing with t

Trends in Cloud Computing Assignment Example | Topics and Well Written Essays - 1000 words

Trends in Cloud Computing - Assignment Example The users of the technology need not to have knowledge of, expertise in, or control over the technology infrastructures "in the cloud" that supports them. Buyya et al. (2009) stated that the concept incorporates infrastructure as a service (IaaS), platform as a service (PaaS) and software as a service (SaaS) as well as Web 2.0 and other recent technological trends that have the common theme of dependency on the Internet for meeting computing needs of the users. Examples of such providers are Dropbox.com, Salesforce.com, and Google Apps, which all provide common business applications online that are accessed from a web browser, while the software and data are stored on the servers. Referring to the writings by Cohen (2012) the term cloud is used as a metaphor for the Internet, based on how the Internet is depicted in computer network diagrams, and is an abstraction for the complex infrastructure it conceals. The diagram below helps to demonstrate the architecture of cloud computing an d how it incorporates the use of other technologies in order to provide a variety of applications of services. Figure 1: Graphical representation of cloud computing Sources: http://www.dummies.com/how-to/content/comparing-public-private-and-hybrid-cloud-computin.html In the writings by Saboowala et al. (2013), they stated that cloud computing mainly involves software as a service and utility computing. Under Software as a Service, cloud computing is known for providing an application via the internet, which ends up being used by millions of people located in different corners of the world. Under utility computing, it is noted that cloud computing provide storage and virtual servers that users can easily access on real time basis. The top trends in cloud computing In the writings by Cohen (2012), he noted that the latest trends in cloud computing are because of continued application of cloud computing in various forms, and therefore, the technology has been realigning itself to the c hanging needs of providers and businesses, which has created new utility options for the technology of which key among them is big data analytics. Big data analytics According to Schlesinger (2013), big data analytics is one of the latest trends in cloud computing and it refers to the capability of cloud computing to manage big amounts of data from various sources. Therefore, the latest trends is the analysis of big data that is available â€Å"in the cloud† in a single approach without any sub-division of data into manageable chunks. The big data analytics enables organizations to carry an analysis of data that that is generated from a long period of time from multiple sources using a common approach. For example, Buyya et al. (2009) stated that within the public cloud, access can be obtained to individual files containing variety of data from different businesses within the same industry and the analysis of such data will provide a global outlook of the entire industry. Big data analytics services by cloud computing provide key benefits of reduced cost in analyzing wide data and shortened duration of analyzing data. Increased application of hybrid clouds Cohen (2012) wrote that as businesses are increasingly identifying the benefits of cloud computing they are equally increasing their adoption of the use of cloud computing for various business purposes. This has resulted in a trend

Socioemotional Development Education Assignment

Socioemotional Development Education - Assignment Example The second determinant of the friendship among the children is the social and economic backgrounds. The teacher revealed that more than 40% of the friendship witnessed in class is determined by the social status of the families of the children. He noted that most of those children who come from rich families are more likely to become friends. Third form of relationship witnessed in classroom environment is determined by academic factors. The teacher revealed that most children who share common academic performance tend to relate with each other. The last form of friendship that was noted is determined by the geographic setting. It was found that those children from the same geographic location exhibit closer friendship. In another interview to determine the things that make a kid popular, a number of things came out. The teacher asserted that academic performance is the main factor that makes the kids popular. He noted that when a kid is regularly awarded for a good work he or she ha s done, the others will see him or her taking the reward hence become more popular both to the teachers and other children. He also stated that the level of physical activity of the child play a significant role in determining popularity of the child. He noted that the when he or she is playful, jovial and happy become more popular than others mainly because his or her playfulness would enable him interact with more children. The third determinant of the popularity of a child is the level of discipline. The findings from the interview show that extremely rude kids are more popular than those who are average in their discipline. Equally, very discipline kids are more popular than those whose levels of disciplines are average. As far as the rejection and neglecting of the kids in school is concerned, the teacher revealed a number of factors behind these issues. He stated that disability is one of the major factors behind the rejection and neglecting of the kids. He argues that normal kids do not like to associate themselves with the physically challenged kids. Because of this, the handicapped kids would feel rejected. The second factor that the teacher identified is racial discrimination. The teacher stated that despite the fact that the school administration discourages any form of racial discrimination; the whites normally reject kids from different races especially from blacks. However, the teacher claims that they do not express it explicitly mainly because it is against the school rules. The social background of the kid is another factor leading to rejection and neglecting. It was noted that a kid who is from a humble background is usually neglected and rejected by those who come from rich families. The last factor is the academic performances. A kid who has poor academic performances can be rejected and neglected by his or her classmates. Question two answer The interview was then focused into elucidation of ways of reversing the cases of rejection and neg lecting is through reversing the above factors. The teacher noted that the best way of reversing the issues of related to poor academic performance is by improving the academic performance. He also noted that the cases associated with the disabilities can be solved by encouraging the students to show love and care on each other. Additionally, I interviewed the teacher on the approaches that should be adopted in order to assist kids with disabilities. He

Needs & Motivation Essay Example | Topics and Well Written Essays - 250 words

Needs & Motivation - Essay Example say will discuss the Maslow’s Hierarchy of needs theory and how it is applied in Southwest according to the â€Å"People† section of 2011 Southwest One Report. Maslow was and industrial psychologist who studied human behavior. He said that human needs can be arranged in a hierarchy as individuals progress from the lower level to the higher level needs. Individuals would be motivated to fulfill whichever needs were important to them at a given time. These needs include self-actualization needs, Ego/esteem needs, socio-affiliation needs, safety/security needs, and physiological needs (Lauby 1). The Southwest satisfies the physiological needs of their employees by putting them first and offering them an opportunity to pursue good health. The need for safety and security is catered for by creating financial security for the employees. The socio-affiliation needs are taken care of by allowing employees to travel and socialize, have fun and stay connected. Making a positive difference caters for the ego and self-esteem needs of the employees. Self-actualization needs are met by allowing employees to learn and grow, create and innovate, and work hard to achieve their goals. The Southwest’s way, of motivating employees, is a good one and if I were one of its employees I would be positively motivated to work harder. I would work to achieve both personal and organizational goals. Putting employees first is a good way of

Understand How to Establish an Effective Team Assignment

Understand How to Establish an Effective Team - Assignment Example Understand How to Establish an Effective Team In a report written by A.W.C. Training entitled â€Å"Effective Working Relationships†, emphasize was placed on enhancing awareness regarding the importance of maintaining happy relationships within the organizational setting for the reason that smooth and effective working relationships were noted to be instrumental in tasks and responsibilities being undertaken more efficiently; and thus, enabling the delivery of high quality of customer service. Within a team, the development of effective working relationship presupposes the application of effective communication as a framework of success. According to Harbour (2013), â€Å"good communication makes it easier to address individual problems or concerns between employees and supervisors when they arise† (par. 8). Communication also enables the dissemination of crucial information, including policies, procedures, and the organization’s code of discipline, to provide guidelines to the employees, various members of a team, and other stakeholders, in manifesting the expected behavior. For example, in a newly formed team tasked to present suggestions and recommendations to increase sales of the products, an effectively developed and maintained team who follows the abovementioned guidelines are expected to be more cohesive and to delegate tasks, share crucial information, and equitably divide the responsibilities needed in coming up with a presentation that would satisfy organizational goals. Benefits of Effective Working Relationships in Developing and Maintaining the Team The benefits of effective working relationships in developing and maintaining the team are therefore realized in terms of showing cohesiveness, increasing performance and productivity, reporting lesser conflicts or miscommunication, and satisfying the needs and demands of the customers. As asserted, â€Å"good workplace relationships and a positive work environment is critical for a successful business, as unhappy staff have a negative impact on productivity and customer service† (Harbour, 2013, par. 7). Behaviours which Could Develop and Maintain Trust at Work The behaviours which could develop and maintain trust at work include the following: (1) maintaining sincerity; (2) being reliable; (3) being accountable; (4) listening attentively and actively; (5) not blaming others; and (6) being transparent in all undertakings with honesty and integrity (Piccinini, 2013). For instance, in the organizational setting, trust could be developed and maintained when members of a team have openly established the need to be open to each other and communicate truthful information to the most effective manner. When a member of the team makes a mistake, other members must assume a stance of understanding and refrain from blaming the errant member. All members must therefore

Compare and contrast Essay Example for Free

Compare and contrast Essay Bodhisattva is a special illumination where the adept is believed to be awakened to minds of greater power. Buddhists believe that in bodhisattva the individual is made to obtain an enlightened thought. This kind of illumination obtained has to originate from the universal mind. Through this the adept receives a divine power that flows in his own body, stimulates his sense receptors to make him enjoy an inward spiritual awakening in his whole body (Robinson and Johnson, pg 271-296). Tantric adept focuses on the use of sound of the goddess in order to bring oneness of body, soul and spirit. This makes the individuals attain the ability to expel emotional pain, self depression and individual despair. Tantra implies the process of having a sense of mythical vibrations and sounds. Buddhism and Hinduism believe that through the worship of the goddess, the tantrans acquire a self realization and awareness. BODHISATTVA AND THE TANTRIC ADEPT Bodhisattva is believed to consider the destruction of an era to be as a result of oneself. Atman is thought to be the case where the individual deserves the punishment and the eventual destruction. In most cases this results in the complete extinction of a generation. Tantric adept on the other hand considers the destruction of an era to emerge from duality. In its expression, it opposes the unity that is believed to lead to the realization of Atman. In Bodhisattva, the main identity is Chimaminda which stands for kali. It describes the victory of the Buddhist as followers of Buddha the goddess (De Bary, William, 2003 chapter 1, 2, 3, 4). Tantric adept on the other hand focuses on chinamasta which Hindus consider to be associated with Kama and Rati. This iconography means the process of copulating bodies. It basically demonstrates the creation and his eventual destruction to be part of the human cycle. Prior to Bodhisattva the adept is expected to receive an element called archetype of Buddha. This is the knowledge that erupts all over suddenly without the individual realizing. This same concept is seen in tantric adept which advocates for self realization. Bodhisattva advocates for an inward awakening of the individuals to know what they did not know (Robinson and Johnson, pg. 130-137). The adept should therefore receive a prior archetype of Buddha. This knowledge acquisition is sudden while Tantric adept advocate for women enrolment in Tantra because of the special place they have in the society. Tantric adept encourages initiations which will allow women spiritual and aspiration desires to come to a fulfillment whereas Bodhisattva perceives men to be more superior to women in all spheres. In both Bodhisattva and tantric adept, chinnamaster are understood through having a prior knowledge of Kundalini yoga, susumna, Ida and Pingala. These are the major four channels of great importance to Buddhism and Hinduism. Having a perception of duality is believed to be caused by the inability of the two channels to enter the susumna when it is closed. When the tantric adept has acquired the knowledge of having a feeling of free blood circulation right from the central part, the individual is said to be self realized. The tantric thus uses the knowledge learnt to untie the knots creating undisrupted flow of energy. Both Bodhisattva and Tantric adept considers the goddess head to show destruction of generation (De Bary, William, 2003 chapter 1, 2, 3, 4). The teachings involved in Bodhisattva are hard and quite longer than those of tantric adept. There is only one sudden enlighten at gotra. However this kind of experience lives the adept with wounds of how to master bodhisattva as a way of living. CHARACTERISTICS OF TANTRIC ADEPT All acquired merits are shared which allows an individual to be free from all calamities. Due to this the Buddhist lives together peacefully. Characteristics of prosperity originates from Buddha Worship is done in twenty different ways followed by a dedication for acceptance The Bodhisattva have undergo initiation CHARACTERISTICS OF BODHISATTVA Its basis is on the inward awakening of the individuals It is characterized with an element called archetype Believes in a sudden knowledge acquiring There activity and career are long and hard making enlightens to be above gotra. SPIRITUAL AND SOCIAL GOALS OF THE BODHISATTVA AND THE TANTRIC ADEPT Their spiritual belief is on the worship of goddess called Buddha Spiritually it is recommended for the Hindus and the Buddhists to only take refuge in Budda, dhamna and Sangha. These centers are commonly referred to as the Sarangamana. Spiritually they recommend the recognition of the good deeds of an individual. This is encouraged in the spiritual context of the Buddhist to be a sincere approval of them. The Bodhisattva and Tantric adept considers all its faithful to be ignorant. Buddha therefore has a responsibility to provide guidance to the individuals (De Bary, William, 2003 chapter 1, 2, 3, 4). This is called Yacana according to the Buddha perspective. Spiritually teachings of Buddha are not just meant for an individual. These teachings should be offered to others. This merit is meant to inculcate positively of the persons and is referred to as Parimmana. Spiritually every one who subscribe to this faith is expected to develop bodhisattva. Work cited De Bary, William. The Buddhist Tradition. USA: Random house, Inc. 2003. Robinson and Johnson. Buddhist Religion: A Historical Introduction 4th Ed. USA: Wadsworth publishing Company, 2006. Keith Dowman. Sky Dancer. Nepal, USA: Snow Lion, 1996

Einstein’s statement Essay Example for Free

Einstein’s statement Essay According to Einstein’s statement that Memory is deceptive because it is colored by todays events one should take a concrete position in order to prove it or not. There is nothing frozen in the cycle of life, everything is in flux. The process of memorizing information around is amazing at a glance. However, there should be an explanation of why human beings get stuck on what they know about a definite thing or event, and do not want to step back not a jot. I think that there are several responses on what Einstein once said. Hence, memory can be deceptive for a man, as it refers to the past and to the present only. Here comes a logic evaluation of the Einstein’s statement which designates the idea of what is known to people currently and what is not. Thereupon, it is a matter of contradiction between three states of time, so to speak: past, present, and future. It goes without saying that the first two relate to what is recollected in our memories. On the other side, the future is a mystery for every human being. Memory does not apply to the future events. It is about to gain momentum, as we may call it, of what has been predicted and what it comes out to be as a result. However, there is an aspect of memory which relies on peoples’ suggestibility (Platek, Keenan, Shackelford, 2007). This feature of memory can serve as pseudo-persuasiveness in what has not happened yet. Within my remembrance, I have too many cases when I could state that memory is really deceptive, and is based on some evidences at hand. It was when I tried to win in lottery. I was sure that a fortune will help me. Nevertheless, I tried to work out a specific formula on finding out the â€Å"receipt of hitting jackpot† at once. My memories could give me just the examples based on the experience of many millions of people who failed to reach out a definite circumspect approach toward solving the enigmatic mystery of where the luck is. As a result, I just spent a pretty some of money, as related to all cases when I bought a bunch of lottery tickets. It fell into nothing at all, unfortunately. However, since that time I have been working over a philosophical attitude toward what knowledge is. Furthermore, it became interesting to me that memory can become vague in some moments, as it complies with physiological processes as well. Thus, memory does not just colors today’s events and gives no answer on what will become tomorrow. It also makes people realize the things going on all around. There is an assumption that the hidden power of brain can work miracles in perceiving events of tomorrow. People can just change their consciousness in order to discolor reality and appear in parallel worlds. However, it is just a hypothesis which Einstein once claimed during his investigation of the concept of time as such. To sum up, memory complies with the past and the present. It has no connection with the future. Hence, people are misinformed about what awaits them in future. In turn it proves the idea that memory is deceptive and that it is colored solely in accordance with today’s events. That is the argument for getting the properties and nature of memory in brief. Reference Platek, S. M. , Keenan, J. P. , Shackelford, T. K. (2007). Evolutionary cognitive neuroscience. Boston: MIT Press.

Asset Returns in African Stock Market Indexes

Asset Returns in African Stock Market Indexes 1.0 INTRODUCTION Financial markets are important in an economy in that they involve lots of monetary funds in the capital markets. These funds enable firms to raise finance in the form of equities and debts as means to finance expansion or expenses. Hence they serve the intermediation process and also provide a means for investors to diversify their portfolio of assets. African stock markets have been subject to economic restructuration as well as stock exchange modernisation these recent years. They now face regional and global integration and so the need to investigate their returns characteristics. Efficiency is an integral part of investment valuation. When markets are efficient, security prices are properly valued as they absorb all information at each point of time. This leads to optimal allocation of private and social resources. Moreover, investors may not beat the market and make abnormally higher returns than others, based on information asymmetry. Conversely, inefficiency leads to market prices deviating from actual value. Hence, those having reasonable level of expertise in the field of valuation will be able to spot and exploit above and under-valued stocks. Efficiency in equity markets is of significance to investors and policymakers in African markets. The concept has been widely applied to developed countries but less attention has been devoted to less developed ones. These researches indicate the importance of developing stock markets for countries which are at appropriate stage of economic growth. Indeed, it is more convenient to test for weak form efficiency of market rather than testing for semi-strong or strong forms of efficiency due to lack of data and supervision pertaining to those markets. 1.1 Organisation of the paper The objective of this study is to examine the possibility of both short- and long-term memory in asset returns in selected African markets stock indexes. Besides South Africa, all the other markets are still in developing state so that efficiency can be gauged on basis of market development and size. The paper is organised as follows: * Section 2 describes informational efficiency with emphasis on weak-form efficiency and random walk. Critics relating to the latter are then raised to emphasise on non-linearity and long-term dimensions. * Section 3 provides a brief description of the characteristics of the selected African stock markets as well as their respective indices. * A methodological discussion based on the different random walks and long-term analysis is then presented in the fourth section. * Tests, results and discussions are provided in section 5. The possible explanations for efficiency or inefficiency pertaining to the respective markets are also made. * Finally, we conclude in section 6 and make policy recommendations as well as future scope for research. 1.2 Limitations of the Study This paper in centered on market efficiency. However, given the excessive literature that exists in this field, it is beyond the scope this study to review all the previous works related to the study. We therefore provide only a short discussion on the main findings associated to the weak-form efficiency or random walk hypothesis to provide a general overview of the paper. Besides, the main limitation of this paper is that we restrict to the weak-form efficiency using time series analysis. Consequently, the statistical tests are only used to test for market efficiency excluding any transaction costs adjustment such as the bid-ask spread. Finally, we use daily data for the analysis though it may lead to possible biasness in the observations. We believe that using a longer time period would help to reduce this problem. LITERATURE REVIEW 2.0 Introduction Efficient market hypothesis is one of the most researched topics in the realm of the stock market. While most of the early studies have previously been centered on developed stock markets like USA, Japan and Europe, developing and emerging stock markets have been brushed aside. Before proceeding with a systematic and ordered approach, it might be useful to present a general review of the theory under study, which in turn aims at defining the main concepts and demonstrating familiarity with previous relevant findings concerning the same field of research. 2.1 Theoretical review In this section, we develop a formal view of the weak-form efficiency as well as the random walk hypothesis. Starting with the martingale model, necessary assumptions are made to develop a model consistent with Lo and McKinley (1997) model specification. Making the necessary assumptions about the model, a formal presentation of the different random walks is made and criticised. 2.1.1 Market efficiency Efficiency has various different contextual meanings but analysis of financial markets assumes an informational dimension. The attribute of those markets by virtue of which they respond to new information, is called informational efficiency. This implies that current market price reacts instantaneously to new information so that it incorporates all relevant information. Since, by definition, new information is unpredictable, it follows that change in stock price cannot be anticipated and thus move in a random manner. Informational efficiency can be related to the hypothesis of random walk which assumes that prices do not exhibit predictive patterns over time and follow a random walk. Hence, prediction of future prices in absolute terms, based singly on information about historical price, will be unsuccessful. The theory had its roots from the early works of Bachelier (1900). In his own words, Bachelier argued that â€Å"past, present and even discounted future events are reflected in market price, but often show no apparent relation to price changes†. This emphasises the informational content of stock prices. In his paper on the behaviour of stock and commodity prices, Maurice Kendall (1953) further supported the random walk theory. The findings, unexpectedly, showed that prices follow a random walk and not regular cycles. His conclusion was that the series appeared ‘wandering, ‘Almost as if once a week the Demon of Chance drew a random number from a symmetrical population of fixed dispersion and added it to the current price to determine the next weeks price In his thesis, Behaviour of stock market prices, Fama supported the random walk theory where he reviewed previous works on stock price movements. He concluded that â€Å"it seems safe to say that this paper has presented strong and voluminous evidence in favour of the random walk hypothesis.† Indeed in a market where prices are determined rationally, only new information will cause them to change. Hence prices follow a random walk to reflect all current knowledge. If price prediction were possible, this would have caused market inefficiency as prices dont incorporate all information. Fama (1965) was the first one who coined the term efficient market. He held that such a market is one constituting of a large number of competing rational and active profit-maximisers who try to predict individual values of securities. Information in those markets tends to be almost free. He argued that the essence of ‘instantaneous adjustment in actual prices to new information is competition leading to efficiency in the market. Later, the random walk theory was broadened into a concept called the efficient market theory. Based on the works of Samuelson (1965) and Roberts (1967), Fama (1970) developed a second paper: Efficient capital markets: A review of theory and empirical work. He distinguished between three levels of efficiency, as earlier initiated by Roberts (1967), based on three sets of information reflected in the price. He posited that a market is efficient in the weak-form if any information which might be contained in past price movements is already reflected in the security prices. It is semi-strong efficient when all relevant publicly available information is impounded in security prices while strong form efficiency suggests that security prices already reflect all available information, even private information. In this stream of literature, Malkiel (1992) contribution is elaborated in his essay Efficient market hypothesis in the New Palgrave Dictionary of Money and Finance. He defines a capital market as efficient when it fully and correctly reflects all relevant information in security price determination. Hence, for some information set, à ¢Ã¢â‚¬Å¾Ã‚ ¦t, the market is efficient if security prices are unaffected by unveiling that information to market participants. Then it becomes impossible to make economic profits by exploiting the information set. Hence, both the random walk theory and the EMH are related to informational efficiency. Then the form of efficiency under consideration will depend upon the information set, à ¢Ã¢â‚¬Å¾Ã‚ ¦t, which determines the level of efficiency. 2.1.2 Weak Form Efficiency: Random walk and its critics Weak-form efficiency focuses on the informational content of the previous sequence of stock price movements. An informational efficient market postulates that excess return cannot be realised from information contained in past prices. The rationale behind weak-form efficiency is that stock prices are the most publicly available information so that an investor may not be able to use information, which is already available to others, to beat the market. A long considered necessary condition for an efficient asset market is the martingale process. Under market efficiency, the conditional expectation of future price changes, conditional on the price history, cannot be either positive or negative and therefore must be zero. In fact the martingale originated from gambling and the concept of fair game. Samuelson (1965) and Mandelbrot (1966) independently demonstrated that a sequence of prices of an asset is a martingale (or a fair game) if it has unbiased price changes. Danthine (1977), LeRoy (1976, 1989), Huang (1985) and Neftci (2000) held that if a security market can be equilibrium and for sure be a fair game, then the following equations must hold: Ept+1ÃŽ ©t=pt (1) Ept+1-ptÃŽ ©t=0 (1.1) Where t denotes the price of an asset at date t, à ¢Ã¢â‚¬Å¾Ã‚ ¦t is a set of all past and current information regarding prices pt,pt-1,pt-2†¦.. and pt+1-pt=rt. Hence, the directions of the future movements in martingales are impossible to forecast. If pt is a martingale in equation (1), the best forecast of pt+1 that could be derived on basis of current information ÃŽ ©t, equals pt. For equation (1.1), rt is a fair game if the forecast is zero for any possible value of ÃŽ ©t. Then pt is a martingale only if rt is a fair game. In this case, asset price evolves in a random process so that the correlation coefficient between the successive price changes will be zero given information about current and past prices. However, most assets are expected to yield a non-zero and positive returns. The martingale hypothesis does not take into account the trade-off between risk and return as pointed out in financial economics. The model implicitly assumes risk neutrality while investors are generally risk averse. In fact, an investor is likely to hold more risky assets provided they are compensated in terms of higher expected returns. In this case, knowledge of the riskiness of current information set implies some awareness about the expected returns. Hence the equilibrium model shall predict a positive price change in the assets price though the actual return is still unforecastable under market efficiency. Then an asset model, considering positive returns, may be formulated as Fama (1970). He suggested the sub-martingale process: Ept+1à ¢Ã†â€™Ã¢â‚¬Å"à ¢Ã¢â‚¬Å¾Ã‚ ¦t≠¥pt or alternatively Ert+1à ¢Ã†â€™Ã¢â‚¬Å"à ¢Ã¢â‚¬Å¾Ã‚ ¦t≠¥0 (1.2) This states that the expected value of next periods price based on the information available at time t, à ¢Ã¢â‚¬Å¾Ã‚ ¦t, is equal to or greater than the current price. Equivalently, it stipulates that the expected returns and price changes are greater or equal to zero. Market efficiency plus an equilibrium model for asset pricing normally produces a random character to asset prices or returns or excess returns. The equilibrium model generally shows how the assets expected return varies with its risk and this can be closely related to Famas sub-martingale model. However, the representative model for the asset uses log prices and the expected continuously compounded return, rt+1. Ert+1ÃŽ ©t=pt+1-pt (1.3) Under the efficient market hypothesis, investors cannot earn abnormal profits on the available information set other than by chance. This is in line with Jensen (1978) who defines a market as efficient with respect to the information set, à ¢Ã¢â‚¬Å¾Ã‚ ¦t, if it not possible to make economic profits on the basis of this set of information. Hence, defining excess returns as zt+1: zt+1=rt+1-Ert+1à ¢Ã†â€™Ã¢â‚¬Å"à ¢Ã¢â‚¬Å¾Ã‚ ¦t (1.4) Since market efficiency implies that all information is already impounded in stock prices, the following applies: Ezt+1à ¢Ã†â€™Ã¢â‚¬Å"à ¢Ã¢â‚¬Å¾Ã‚ ¦t=0 (1.5) Under the assumption that the equilibrium model determining asset prices in (1.3) is assumed to be constant over time, the deduction is that expected return does not depend on the information available at time t such that: pt+1-pt=Ert+1à ¢Ã†â€™Ã¢â‚¬Å"à ¢Ã¢â‚¬Å¾Ã‚ ¦t=Ert+1=r (1.6) Therefore market efficiency produces a result that implies that the changes in asset prices follow a random walk. The appropriate model would then be a random walk with drift where the arbitrary drift parameter, reflects how prices change on average to provide returns to holding the asset over time. The following equation sets the random walk model similar to the one defined by Lo and MacKinlay (1997): pt+1= ÃŽ ¼+pt+ ÃŽ µt+1 (1.7) rt= ÃŽ ¼+ÃŽ ±rt-1+ ÃŽ µt (1.8) If the stock price index follows a random walk, then, ÃŽ ± = 0. Generally, if stock prices and returns are unpredictable then time series have the property of random walk and white noise implying the validity of EMH. Thus, given an equilibrium model for asset pricing, the test for weak-form efficiency is that of random walk tests of market efficiency. Ko and lee (1991) maintained that â€Å"If the random walk hypothesis holds, the weak form of the efficient market hypothesis must hold, but not vice versa. Thus, evidence supporting the random walk model is the evidence of market efficiency. But violation of the random walk model need not be evidence of market inefficiency in the weak form†. Depending on the restrictions put on the increments,ÃŽ µt+1, different forms of the random walk are tested. Within the random walk hypothesis, three successively more restrictive sub-hypotheses with sequentially stronger tests for random walks exists (Campbell et al. 1997). These are range from the most restrictive form of Random Walk 1 (RW1) to the least restrictive one which is the Random Walk 3 (RW3). Based on their extensive research, the orthogonality condition for the random walk is: covfrtgrt+k=0 (1.8) Where frt and grt+k are two arbitrary functions and rt and rt+k refers to the returns for period t and t+k respectively. If (1.9) holds for all functions frt,grt+k this corresponds to RW1 and RW2. The former is the most restrictive version of random walk model implying it is not possible to predict either future price movements or volatility based on past prices. It states that returns are serially uncorrelated with independently and identically distributed increments with mean, zero and variance, ÏÆ'2. Under RW2, the returns are serially uncorrelated, corresponding with a random walk hypothesis with increments that are independent but not identically distributed. In case frt,grt+k are arbitrary linear functions, the RW3 applies so that it is not possible to use information on the basis of past prices to predict future prices. Hence, returns in a market conforming to this standard of random walk are serially uncorrelated, corresponding to a random walk hypothesis with dependent but uncorrelated increments. The foundation of traditional tests of random walk rests on the assumption of IID. The most famous tests remain the sequences and reversals test proposed by Cowles and Jones (1937) and the runs test. Tests of RW2 and RW3 encompass the variance ratio tests and unit root tests which are more recent tools. Developed by Lo and MacKinlay (1988), hereby LM, the variance ratio tests out that the variance of the innovations pertaining to a random walk model is linear functions of time. This popular test does not restrict only to the RW1 but also to the RW2 and RW3. However, exclusion of non-linear analysis in financial series could lead to inappropriate deductions as regards weak-form efficiency. Indeed, the application of non-linear dynamics and chaos theory to financial series has shown that they evidence non-linear structure. In practice, returns distributions exhibit leptokurtic behaviours as opposed to normal distribution. They often reflect volatility clustering thereby the level of volatility in the next period tends to be positively correlated with its current level. Then it may be possible for information on the variance of past prices to predict the future volatility of the market. Indeed, share price movements could be unpredictable when using linear models but forecastable under non-linear models in the ‘short-run. This contradicts the use of linear models for testing the efficient market hypothesis. Further departures from the random walk hypothesis exist in the long-range dependence. This is analogous to high autocorrelation structure in a series so that there is persistent dependence between distant observations. In this case covfrtgrt+k does not tend to zero at higher lags. As regards market efficiency, persistence implies that past data contain useful information for prediction so that long memory violates the concept. Several tests have been developed for this purpose including the rescaled statistic to test for long-term ‘randomness of the market series and the ARFIMA-FIGARCH which categorises the long- and short-term memory based on the estimated value of the fractional difference. 2.2 Empirical Review Following the work of Fama (1965) â€Å"Random walk in stock prices† arguing for random walk hypothesis, a multitude of research has been performed throughout the world. While most of the well developed markets were found to be efficient, research findings of developing and less developed markets are mixed and controversial too. Most of the less developed market encounters the problem of thin trading. Besides, it is easier for large traders to manipulate small markets. Though emerging markets are generally assumed to be less efficient, empirical evidence does not always support the idea. Some previous research aiming at testing the weak-form efficiency of a particular group of stock markets are presented below. A research that aims at testing weak-form market efficiency in the equity markets of the three main Central European transition economies (the Czech Republic, Hungary, and Poland) is that of Gilmore and McManus (2001). Using different approaches comprising of univariate, multivariate tests as well as the model-comparison approach for the period July 1995 to September 2000 different conclusion were drawn. While the serial correlation-based tests largely support a conclusion that these markets are weak-form efficient, the results of comparing forecasts of alternative models are consistent in rejecting the random walk hypothesis. Examining the existence of weak-form efficiency in European stock market, Worthington and Higgs (2003) used daily returns for sixteen developed markets (Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom) and four emerging markets (Czech Republic, Hungary, Poland and Russia) to perform a number of testing procedures of random walk. They started with the serial correlation coefficient test and the runs test, and found that Netherlands and Germany do follow a random walk while the United Kingdom, Ireland and Portugal were efficient under one test or the other. All remaining markets were weak form inefficient. Beside unit root tests (ADF, PP statistics and KPSS), the multiple variance ratio tests rejected the presence of random walk in most of the markets. While in the developed markets only the United Kingdom, Portugal, Ireland, Sweden and Germany satisfied the most stringent rand om walk criteria, in emerging markets only Hungary did so. Weak-form efficiency for emerging equity markets were also tested by Chang, Lima and Tabak (2003). They deduced that random walk hypothesis is not consistent with Asian equity markets while left apart Chile, Latin American indices resemble a random walk. Using daily prices from January 1992 to December 2002, multivariate variance ratios using heteroscedastic robust bootstrap procedures and test trading rules using trading range break (TRB) levels were employed. Taking the US and Japan as yardsticks, they were not able to reject the random walk hypothesis. Another study considering a group of selected Asian markets; Kim and Shamsuddin (2008) argues that market efficiency varies with the level of stock market development. Using new multiple variance ratio tests based on the wild bootstrap and signs as well as the conventional Chow-Denning test, they found that the Hong Kong, Japanese, Korean and Taiwanese markets adhere to the martingale property while Indonesia, Malaysia, Philippines markets are inefficient. Besides, the results revealed evidence that the Singaporean and Thai markets followed a random walk after the Asian crisis. As regards the Gulf Co-operation Council (GCC) stock markets, Elango and Hussein (2008) tested whether daily returns series are an approximation of normal distribution or not. Dubai, AbuDhabi, Saudi Arabia, Qatar, Kuwait, Oman and Bahrain stock market indices were examined using the Kolmogorov-Smirnov test, Runs test, Autocorrelation Function and Partial Autocorrelation Functions. The results revealed that the distribution of daily returns on these markets deviated from the normal distribution during the study period. Also, the runs test rejected the hypothesis of random walk for all seven markets. In his paper investigating the random walk hypothesis, Urrutia (1995), used monthly data from December 1975 to March 1991 for four Latin American equity markets: Argentina, Brazil, Chile, and Mexico to observe whether they are weak-form efficient. He made use of the Variance-ratio tests and the runs tests. While results of the variance ratio estimatespixel rejects the random walk hypothesis, runs tests specify that Latin American equity markets are weak-form efficient. These empirical findings suggest that domestic investors might not be able to develop trading strategies that would allow them to earn excess returns. Using Lo-MacKinlay Variance ratio, Wrights rank and sign VR and the standard runs tests; Al-Khazali, Ding and Pyun (2007) revisited the validity of random walk hypothesis in eight emerging markets in the Middle East and North Africa (MENA): Bahrain, Egypt, Jordan, Kuwait, Morocco, Oman, Saudi Arabia, and Tunisia. When assessed by Wrights (2000) rank and sign VR test, all the markets rejected the hypothesis of random walk. However, once data are reconciled for distortions from thinly and infrequently traded stocks, all eight stock markets do follow a random walk. African countries were investigated in the paper ‘How Efficient are Africas Emerging Stock Markets by Magnusson and Wydick (2002). Testing procedures considered monthly data for eight African markets in comparison with nine other developing countries in Latin America and Asia. Distinguishing among the three types of random walk models, they started by testing the RW 3, by investigating the Partial Auto-Correlation Function(PACF) of the historical series and examining whether they are statistically different from zero. Markets in Botswana, Cote dIvoire, Kenya, Mauritius and South Africa did conform to the RW3 while those of Ghana, Nigeria and Zimbabwe were rejected. Proceeding with the RW2, excluding Botswana, results did not change. However none of the African Markets were conform to the RW1 White test for heteroscedasticity. They conclude that African countries do conform quite favourably to some regions of the developing world. Another research which focuses on African markets was that of Jefferis and Smith (2005). It covers seven African stock markets: South Africa, Egypt, Morocco, Nigeria, Zimbabwe, Mauritius and Kenya and use a GARCH approach with time-varying parameters to detect changes in weak-form efficiency through time. They emphasised on RW 3 model with volatilities changing over time and found that Johannesburg stock market was weak-form efficient with no tendency to change like many other developed markets. On the other hand, the stock markets of Egypt, Morocco and Nigeria showed changing levels of inefficiencies to become weak-form efficient towards the end of the period. The results for Kenya, Zimbabwe and Mauritius, however, showed tendency towards efficiency and rejected the hypothesis of weak-form efficiency. Recently, McMillan and Thupayagale (2009) in their paper â€Å"The efficiency of African equity markets† examined long memory effects of both equity returns and volatility for eleven African countries, taking the UK and US as reference. They made use of unit roots test and the GARCH(1,1) models before proceeding with ARFIMA-FIGARCH and ARFIMA-HYGARCH models. They ended up with mixed results. The ARFIMA-FIGARCH models provide evidence for long term memory in African equity markets with the exception of Mauritius, Morocco, Botswana and Nigeria where the results were unpredictable. Also, the US stock return volatility was marked by long memory process while the UK was non-stationary. These results were further supported by the ARFIMA-HYGARCH models. 2.3 Conclusion During the course of the literature review, limited evidence on weak form efficiency of African markets was found. These countries have attracted significant investment these last years and are of much importance to portfolio managers. Univariate time series analysis might be important tool for technical analysts in trying to outperform these markets. Indeed, the battery of econometrics software now paves the way for investigation of the random walk hypothesis based on different sets of assumption. A preliminary analysis of the African markets shall provide us with an insight to efficiency based on their attributes and consultation of previous works. GENERAL OVERVIEW OF THE AFRICAN STOCK MARKETS 3.0 Introduction African stock markets, following in the wake of the surge in the world stock markets over the few decades, are starting to take off. Recognizing the importance of stock markets in economic development, several African countries launched stock exchanges during the past two decades. The African Stock Exchange Association (ASEA) was, hence, set up in 1993 so as to promote the development of stock markets. Prior to 1989, there were just five stock markets in Sub-Saharan Africa and three in North Africa. Today, Africa has about 20 active stock markets, with some exchanges more established than others, depending on when they were established. Alongside the rapid expansion of stock markets in the continent, there has also been a significant growth in market capitalization and the number of listed companies. However, with the exception of the well established markets, stock markets in Africa remain thin and illiquid. This study covers four African stock markets namely South Africa, Mauritius , Morocco and Egypt over periods for which data is available. Mauritius Stock Exchange Since its start of trading on the 5th July 1989 under the Stock Exchange Act of 1988, the Mauritius Stock Exchange (SEM) has come a long way. From a pre-emerging market with trading taking place only once a week, the SEM has emerged as one of the leading exchanges in Africa. It operates two markets namely the Official and the Development and Enterprise market (DEM), established in August 2006 to replace the over-the-counter market. The exchange is regulated by the Financial Services Commission. As the second sub-Saharan stock exchange member of the World Federation of Exchanges, SEM operates in line with international standards. In addition, its developing institutional and retail investor base make it an attractive investment destination for foreign investors. The SEM offers quite a limited range of products to its investors and the aim for the next few years would be to increase the range of products offered. The three main indices of the official market are namely the SEMDEX, SEM- 7 and the SEMTRI. As at 30 June 2009, some 40 companies, with a market capitalisation of Rs 130.77 bn, are listed on the Official market and 52 companies, with a market capitalisation of Rs 45.41 bn, are listed on the Development and Enterprise Market (DEM). The SEM maintained an upward momentum, amidst typical market fluctuations, until the end of February 2008. The total market capitalization of the Official Market and the DEM was Rs 173.1 bn at end 2007. This is in line with the levels observed in well-established emerging stock markets. However, like other exchanges, the SEM experienced market volatility since the start of the financial crisis in September 2008. The main pillars of the Mauritian economy were adversely affected and this reflected on hotels and banks stocks listed on the SEM. The market then picked-up by mid-March 2009 on the back of interest rate cuts and stimulus packages put forward by the Government of Mauritius. Johannesburg Stock Exchange The Johannesburg Stock Exchange (JSE), regulated by the Financial Services Board under the Securities Services Act 2004, is the largest exchange in Africa and among the top twenty largest in the world in terms of market capitalisation. JSE Securities Exchange existed since November 1887 and was incorporated as a public limited company on 1st July 2005, pursuant to its demutualization. Since then, the JSE has evolved from a traditional floor based equities trading market to a modern securities exchange providing fully electronic trading, clearing and settlement in equities, financial and agricultural derivatives and other associated instruments and has extensive surveillance capabilities. Technical agreement with the London Stock Exchange (LSE) enables dual primary listings on both exchanges since 2001. Between the listed entity and its trusted trading platforms the South African economy becomes an active hub of activity where expansion is encouraged, businesses are enhanced, performa nce is driven and shareholder value is created. The JSE currently operates four boards for the equities market and the South African bond market is a leader among emerging-market economies. The main market indices are Top 40, Industrial 25, All Share, Oil and Gas Index. As the gateway to Africas economy, the JSE provides the link between international markets and the continent. In 2008, a daily average of 334 million shares was traded on the JSE. At year-end, there were 992 listed securities on the JSE with a total market capitalisation of R4,514 billion compared to R5,696 billion in 2007. Casablanca Stock Exchange Founded in 1929, the Casablanca Stock Exchange (CSE) in Morocco is relatively modern, having experienced reform in 1993. The exchange is well regulated by the Conseil Deontologique des Valeurs Mobilieres (CDVM). Originally, CSE had the Index de la Bourse des Valeurs de Casablanca (IGB) but this was replaced on January 2002 by two indexes: MASI (Moroccan All Shares Index) which comprises all listed shares, allows to follow up all listed values and to have a long-term visibility and MADEX (Moroccan Most Active Shares Index), comprisi Asset Returns in African Stock Market Indexes Asset Returns in African Stock Market Indexes 1.0 INTRODUCTION Financial markets are important in an economy in that they involve lots of monetary funds in the capital markets. These funds enable firms to raise finance in the form of equities and debts as means to finance expansion or expenses. Hence they serve the intermediation process and also provide a means for investors to diversify their portfolio of assets. African stock markets have been subject to economic restructuration as well as stock exchange modernisation these recent years. They now face regional and global integration and so the need to investigate their returns characteristics. Efficiency is an integral part of investment valuation. When markets are efficient, security prices are properly valued as they absorb all information at each point of time. This leads to optimal allocation of private and social resources. Moreover, investors may not beat the market and make abnormally higher returns than others, based on information asymmetry. Conversely, inefficiency leads to market prices deviating from actual value. Hence, those having reasonable level of expertise in the field of valuation will be able to spot and exploit above and under-valued stocks. Efficiency in equity markets is of significance to investors and policymakers in African markets. The concept has been widely applied to developed countries but less attention has been devoted to less developed ones. These researches indicate the importance of developing stock markets for countries which are at appropriate stage of economic growth. Indeed, it is more convenient to test for weak form efficiency of market rather than testing for semi-strong or strong forms of efficiency due to lack of data and supervision pertaining to those markets. 1.1 Organisation of the paper The objective of this study is to examine the possibility of both short- and long-term memory in asset returns in selected African markets stock indexes. Besides South Africa, all the other markets are still in developing state so that efficiency can be gauged on basis of market development and size. The paper is organised as follows: * Section 2 describes informational efficiency with emphasis on weak-form efficiency and random walk. Critics relating to the latter are then raised to emphasise on non-linearity and long-term dimensions. * Section 3 provides a brief description of the characteristics of the selected African stock markets as well as their respective indices. * A methodological discussion based on the different random walks and long-term analysis is then presented in the fourth section. * Tests, results and discussions are provided in section 5. The possible explanations for efficiency or inefficiency pertaining to the respective markets are also made. * Finally, we conclude in section 6 and make policy recommendations as well as future scope for research. 1.2 Limitations of the Study This paper in centered on market efficiency. However, given the excessive literature that exists in this field, it is beyond the scope this study to review all the previous works related to the study. We therefore provide only a short discussion on the main findings associated to the weak-form efficiency or random walk hypothesis to provide a general overview of the paper. Besides, the main limitation of this paper is that we restrict to the weak-form efficiency using time series analysis. Consequently, the statistical tests are only used to test for market efficiency excluding any transaction costs adjustment such as the bid-ask spread. Finally, we use daily data for the analysis though it may lead to possible biasness in the observations. We believe that using a longer time period would help to reduce this problem. LITERATURE REVIEW 2.0 Introduction Efficient market hypothesis is one of the most researched topics in the realm of the stock market. While most of the early studies have previously been centered on developed stock markets like USA, Japan and Europe, developing and emerging stock markets have been brushed aside. Before proceeding with a systematic and ordered approach, it might be useful to present a general review of the theory under study, which in turn aims at defining the main concepts and demonstrating familiarity with previous relevant findings concerning the same field of research. 2.1 Theoretical review In this section, we develop a formal view of the weak-form efficiency as well as the random walk hypothesis. Starting with the martingale model, necessary assumptions are made to develop a model consistent with Lo and McKinley (1997) model specification. Making the necessary assumptions about the model, a formal presentation of the different random walks is made and criticised. 2.1.1 Market efficiency Efficiency has various different contextual meanings but analysis of financial markets assumes an informational dimension. The attribute of those markets by virtue of which they respond to new information, is called informational efficiency. This implies that current market price reacts instantaneously to new information so that it incorporates all relevant information. Since, by definition, new information is unpredictable, it follows that change in stock price cannot be anticipated and thus move in a random manner. Informational efficiency can be related to the hypothesis of random walk which assumes that prices do not exhibit predictive patterns over time and follow a random walk. Hence, prediction of future prices in absolute terms, based singly on information about historical price, will be unsuccessful. The theory had its roots from the early works of Bachelier (1900). In his own words, Bachelier argued that â€Å"past, present and even discounted future events are reflected in market price, but often show no apparent relation to price changes†. This emphasises the informational content of stock prices. In his paper on the behaviour of stock and commodity prices, Maurice Kendall (1953) further supported the random walk theory. The findings, unexpectedly, showed that prices follow a random walk and not regular cycles. His conclusion was that the series appeared ‘wandering, ‘Almost as if once a week the Demon of Chance drew a random number from a symmetrical population of fixed dispersion and added it to the current price to determine the next weeks price In his thesis, Behaviour of stock market prices, Fama supported the random walk theory where he reviewed previous works on stock price movements. He concluded that â€Å"it seems safe to say that this paper has presented strong and voluminous evidence in favour of the random walk hypothesis.† Indeed in a market where prices are determined rationally, only new information will cause them to change. Hence prices follow a random walk to reflect all current knowledge. If price prediction were possible, this would have caused market inefficiency as prices dont incorporate all information. Fama (1965) was the first one who coined the term efficient market. He held that such a market is one constituting of a large number of competing rational and active profit-maximisers who try to predict individual values of securities. Information in those markets tends to be almost free. He argued that the essence of ‘instantaneous adjustment in actual prices to new information is competition leading to efficiency in the market. Later, the random walk theory was broadened into a concept called the efficient market theory. Based on the works of Samuelson (1965) and Roberts (1967), Fama (1970) developed a second paper: Efficient capital markets: A review of theory and empirical work. He distinguished between three levels of efficiency, as earlier initiated by Roberts (1967), based on three sets of information reflected in the price. He posited that a market is efficient in the weak-form if any information which might be contained in past price movements is already reflected in the security prices. It is semi-strong efficient when all relevant publicly available information is impounded in security prices while strong form efficiency suggests that security prices already reflect all available information, even private information. In this stream of literature, Malkiel (1992) contribution is elaborated in his essay Efficient market hypothesis in the New Palgrave Dictionary of Money and Finance. He defines a capital market as efficient when it fully and correctly reflects all relevant information in security price determination. Hence, for some information set, à ¢Ã¢â‚¬Å¾Ã‚ ¦t, the market is efficient if security prices are unaffected by unveiling that information to market participants. Then it becomes impossible to make economic profits by exploiting the information set. Hence, both the random walk theory and the EMH are related to informational efficiency. Then the form of efficiency under consideration will depend upon the information set, à ¢Ã¢â‚¬Å¾Ã‚ ¦t, which determines the level of efficiency. 2.1.2 Weak Form Efficiency: Random walk and its critics Weak-form efficiency focuses on the informational content of the previous sequence of stock price movements. An informational efficient market postulates that excess return cannot be realised from information contained in past prices. The rationale behind weak-form efficiency is that stock prices are the most publicly available information so that an investor may not be able to use information, which is already available to others, to beat the market. A long considered necessary condition for an efficient asset market is the martingale process. Under market efficiency, the conditional expectation of future price changes, conditional on the price history, cannot be either positive or negative and therefore must be zero. In fact the martingale originated from gambling and the concept of fair game. Samuelson (1965) and Mandelbrot (1966) independently demonstrated that a sequence of prices of an asset is a martingale (or a fair game) if it has unbiased price changes. Danthine (1977), LeRoy (1976, 1989), Huang (1985) and Neftci (2000) held that if a security market can be equilibrium and for sure be a fair game, then the following equations must hold: Ept+1ÃŽ ©t=pt (1) Ept+1-ptÃŽ ©t=0 (1.1) Where t denotes the price of an asset at date t, à ¢Ã¢â‚¬Å¾Ã‚ ¦t is a set of all past and current information regarding prices pt,pt-1,pt-2†¦.. and pt+1-pt=rt. Hence, the directions of the future movements in martingales are impossible to forecast. If pt is a martingale in equation (1), the best forecast of pt+1 that could be derived on basis of current information ÃŽ ©t, equals pt. For equation (1.1), rt is a fair game if the forecast is zero for any possible value of ÃŽ ©t. Then pt is a martingale only if rt is a fair game. In this case, asset price evolves in a random process so that the correlation coefficient between the successive price changes will be zero given information about current and past prices. However, most assets are expected to yield a non-zero and positive returns. The martingale hypothesis does not take into account the trade-off between risk and return as pointed out in financial economics. The model implicitly assumes risk neutrality while investors are generally risk averse. In fact, an investor is likely to hold more risky assets provided they are compensated in terms of higher expected returns. In this case, knowledge of the riskiness of current information set implies some awareness about the expected returns. Hence the equilibrium model shall predict a positive price change in the assets price though the actual return is still unforecastable under market efficiency. Then an asset model, considering positive returns, may be formulated as Fama (1970). He suggested the sub-martingale process: Ept+1à ¢Ã†â€™Ã¢â‚¬Å"à ¢Ã¢â‚¬Å¾Ã‚ ¦t≠¥pt or alternatively Ert+1à ¢Ã†â€™Ã¢â‚¬Å"à ¢Ã¢â‚¬Å¾Ã‚ ¦t≠¥0 (1.2) This states that the expected value of next periods price based on the information available at time t, à ¢Ã¢â‚¬Å¾Ã‚ ¦t, is equal to or greater than the current price. Equivalently, it stipulates that the expected returns and price changes are greater or equal to zero. Market efficiency plus an equilibrium model for asset pricing normally produces a random character to asset prices or returns or excess returns. The equilibrium model generally shows how the assets expected return varies with its risk and this can be closely related to Famas sub-martingale model. However, the representative model for the asset uses log prices and the expected continuously compounded return, rt+1. Ert+1ÃŽ ©t=pt+1-pt (1.3) Under the efficient market hypothesis, investors cannot earn abnormal profits on the available information set other than by chance. This is in line with Jensen (1978) who defines a market as efficient with respect to the information set, à ¢Ã¢â‚¬Å¾Ã‚ ¦t, if it not possible to make economic profits on the basis of this set of information. Hence, defining excess returns as zt+1: zt+1=rt+1-Ert+1à ¢Ã†â€™Ã¢â‚¬Å"à ¢Ã¢â‚¬Å¾Ã‚ ¦t (1.4) Since market efficiency implies that all information is already impounded in stock prices, the following applies: Ezt+1à ¢Ã†â€™Ã¢â‚¬Å"à ¢Ã¢â‚¬Å¾Ã‚ ¦t=0 (1.5) Under the assumption that the equilibrium model determining asset prices in (1.3) is assumed to be constant over time, the deduction is that expected return does not depend on the information available at time t such that: pt+1-pt=Ert+1à ¢Ã†â€™Ã¢â‚¬Å"à ¢Ã¢â‚¬Å¾Ã‚ ¦t=Ert+1=r (1.6) Therefore market efficiency produces a result that implies that the changes in asset prices follow a random walk. The appropriate model would then be a random walk with drift where the arbitrary drift parameter, reflects how prices change on average to provide returns to holding the asset over time. The following equation sets the random walk model similar to the one defined by Lo and MacKinlay (1997): pt+1= ÃŽ ¼+pt+ ÃŽ µt+1 (1.7) rt= ÃŽ ¼+ÃŽ ±rt-1+ ÃŽ µt (1.8) If the stock price index follows a random walk, then, ÃŽ ± = 0. Generally, if stock prices and returns are unpredictable then time series have the property of random walk and white noise implying the validity of EMH. Thus, given an equilibrium model for asset pricing, the test for weak-form efficiency is that of random walk tests of market efficiency. Ko and lee (1991) maintained that â€Å"If the random walk hypothesis holds, the weak form of the efficient market hypothesis must hold, but not vice versa. Thus, evidence supporting the random walk model is the evidence of market efficiency. But violation of the random walk model need not be evidence of market inefficiency in the weak form†. Depending on the restrictions put on the increments,ÃŽ µt+1, different forms of the random walk are tested. Within the random walk hypothesis, three successively more restrictive sub-hypotheses with sequentially stronger tests for random walks exists (Campbell et al. 1997). These are range from the most restrictive form of Random Walk 1 (RW1) to the least restrictive one which is the Random Walk 3 (RW3). Based on their extensive research, the orthogonality condition for the random walk is: covfrtgrt+k=0 (1.8) Where frt and grt+k are two arbitrary functions and rt and rt+k refers to the returns for period t and t+k respectively. If (1.9) holds for all functions frt,grt+k this corresponds to RW1 and RW2. The former is the most restrictive version of random walk model implying it is not possible to predict either future price movements or volatility based on past prices. It states that returns are serially uncorrelated with independently and identically distributed increments with mean, zero and variance, ÏÆ'2. Under RW2, the returns are serially uncorrelated, corresponding with a random walk hypothesis with increments that are independent but not identically distributed. In case frt,grt+k are arbitrary linear functions, the RW3 applies so that it is not possible to use information on the basis of past prices to predict future prices. Hence, returns in a market conforming to this standard of random walk are serially uncorrelated, corresponding to a random walk hypothesis with dependent but uncorrelated increments. The foundation of traditional tests of random walk rests on the assumption of IID. The most famous tests remain the sequences and reversals test proposed by Cowles and Jones (1937) and the runs test. Tests of RW2 and RW3 encompass the variance ratio tests and unit root tests which are more recent tools. Developed by Lo and MacKinlay (1988), hereby LM, the variance ratio tests out that the variance of the innovations pertaining to a random walk model is linear functions of time. This popular test does not restrict only to the RW1 but also to the RW2 and RW3. However, exclusion of non-linear analysis in financial series could lead to inappropriate deductions as regards weak-form efficiency. Indeed, the application of non-linear dynamics and chaos theory to financial series has shown that they evidence non-linear structure. In practice, returns distributions exhibit leptokurtic behaviours as opposed to normal distribution. They often reflect volatility clustering thereby the level of volatility in the next period tends to be positively correlated with its current level. Then it may be possible for information on the variance of past prices to predict the future volatility of the market. Indeed, share price movements could be unpredictable when using linear models but forecastable under non-linear models in the ‘short-run. This contradicts the use of linear models for testing the efficient market hypothesis. Further departures from the random walk hypothesis exist in the long-range dependence. This is analogous to high autocorrelation structure in a series so that there is persistent dependence between distant observations. In this case covfrtgrt+k does not tend to zero at higher lags. As regards market efficiency, persistence implies that past data contain useful information for prediction so that long memory violates the concept. Several tests have been developed for this purpose including the rescaled statistic to test for long-term ‘randomness of the market series and the ARFIMA-FIGARCH which categorises the long- and short-term memory based on the estimated value of the fractional difference. 2.2 Empirical Review Following the work of Fama (1965) â€Å"Random walk in stock prices† arguing for random walk hypothesis, a multitude of research has been performed throughout the world. While most of the well developed markets were found to be efficient, research findings of developing and less developed markets are mixed and controversial too. Most of the less developed market encounters the problem of thin trading. Besides, it is easier for large traders to manipulate small markets. Though emerging markets are generally assumed to be less efficient, empirical evidence does not always support the idea. Some previous research aiming at testing the weak-form efficiency of a particular group of stock markets are presented below. A research that aims at testing weak-form market efficiency in the equity markets of the three main Central European transition economies (the Czech Republic, Hungary, and Poland) is that of Gilmore and McManus (2001). Using different approaches comprising of univariate, multivariate tests as well as the model-comparison approach for the period July 1995 to September 2000 different conclusion were drawn. While the serial correlation-based tests largely support a conclusion that these markets are weak-form efficient, the results of comparing forecasts of alternative models are consistent in rejecting the random walk hypothesis. Examining the existence of weak-form efficiency in European stock market, Worthington and Higgs (2003) used daily returns for sixteen developed markets (Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom) and four emerging markets (Czech Republic, Hungary, Poland and Russia) to perform a number of testing procedures of random walk. They started with the serial correlation coefficient test and the runs test, and found that Netherlands and Germany do follow a random walk while the United Kingdom, Ireland and Portugal were efficient under one test or the other. All remaining markets were weak form inefficient. Beside unit root tests (ADF, PP statistics and KPSS), the multiple variance ratio tests rejected the presence of random walk in most of the markets. While in the developed markets only the United Kingdom, Portugal, Ireland, Sweden and Germany satisfied the most stringent rand om walk criteria, in emerging markets only Hungary did so. Weak-form efficiency for emerging equity markets were also tested by Chang, Lima and Tabak (2003). They deduced that random walk hypothesis is not consistent with Asian equity markets while left apart Chile, Latin American indices resemble a random walk. Using daily prices from January 1992 to December 2002, multivariate variance ratios using heteroscedastic robust bootstrap procedures and test trading rules using trading range break (TRB) levels were employed. Taking the US and Japan as yardsticks, they were not able to reject the random walk hypothesis. Another study considering a group of selected Asian markets; Kim and Shamsuddin (2008) argues that market efficiency varies with the level of stock market development. Using new multiple variance ratio tests based on the wild bootstrap and signs as well as the conventional Chow-Denning test, they found that the Hong Kong, Japanese, Korean and Taiwanese markets adhere to the martingale property while Indonesia, Malaysia, Philippines markets are inefficient. Besides, the results revealed evidence that the Singaporean and Thai markets followed a random walk after the Asian crisis. As regards the Gulf Co-operation Council (GCC) stock markets, Elango and Hussein (2008) tested whether daily returns series are an approximation of normal distribution or not. Dubai, AbuDhabi, Saudi Arabia, Qatar, Kuwait, Oman and Bahrain stock market indices were examined using the Kolmogorov-Smirnov test, Runs test, Autocorrelation Function and Partial Autocorrelation Functions. The results revealed that the distribution of daily returns on these markets deviated from the normal distribution during the study period. Also, the runs test rejected the hypothesis of random walk for all seven markets. In his paper investigating the random walk hypothesis, Urrutia (1995), used monthly data from December 1975 to March 1991 for four Latin American equity markets: Argentina, Brazil, Chile, and Mexico to observe whether they are weak-form efficient. He made use of the Variance-ratio tests and the runs tests. While results of the variance ratio estimatespixel rejects the random walk hypothesis, runs tests specify that Latin American equity markets are weak-form efficient. These empirical findings suggest that domestic investors might not be able to develop trading strategies that would allow them to earn excess returns. Using Lo-MacKinlay Variance ratio, Wrights rank and sign VR and the standard runs tests; Al-Khazali, Ding and Pyun (2007) revisited the validity of random walk hypothesis in eight emerging markets in the Middle East and North Africa (MENA): Bahrain, Egypt, Jordan, Kuwait, Morocco, Oman, Saudi Arabia, and Tunisia. When assessed by Wrights (2000) rank and sign VR test, all the markets rejected the hypothesis of random walk. However, once data are reconciled for distortions from thinly and infrequently traded stocks, all eight stock markets do follow a random walk. African countries were investigated in the paper ‘How Efficient are Africas Emerging Stock Markets by Magnusson and Wydick (2002). Testing procedures considered monthly data for eight African markets in comparison with nine other developing countries in Latin America and Asia. Distinguishing among the three types of random walk models, they started by testing the RW 3, by investigating the Partial Auto-Correlation Function(PACF) of the historical series and examining whether they are statistically different from zero. Markets in Botswana, Cote dIvoire, Kenya, Mauritius and South Africa did conform to the RW3 while those of Ghana, Nigeria and Zimbabwe were rejected. Proceeding with the RW2, excluding Botswana, results did not change. However none of the African Markets were conform to the RW1 White test for heteroscedasticity. They conclude that African countries do conform quite favourably to some regions of the developing world. Another research which focuses on African markets was that of Jefferis and Smith (2005). It covers seven African stock markets: South Africa, Egypt, Morocco, Nigeria, Zimbabwe, Mauritius and Kenya and use a GARCH approach with time-varying parameters to detect changes in weak-form efficiency through time. They emphasised on RW 3 model with volatilities changing over time and found that Johannesburg stock market was weak-form efficient with no tendency to change like many other developed markets. On the other hand, the stock markets of Egypt, Morocco and Nigeria showed changing levels of inefficiencies to become weak-form efficient towards the end of the period. The results for Kenya, Zimbabwe and Mauritius, however, showed tendency towards efficiency and rejected the hypothesis of weak-form efficiency. Recently, McMillan and Thupayagale (2009) in their paper â€Å"The efficiency of African equity markets† examined long memory effects of both equity returns and volatility for eleven African countries, taking the UK and US as reference. They made use of unit roots test and the GARCH(1,1) models before proceeding with ARFIMA-FIGARCH and ARFIMA-HYGARCH models. They ended up with mixed results. The ARFIMA-FIGARCH models provide evidence for long term memory in African equity markets with the exception of Mauritius, Morocco, Botswana and Nigeria where the results were unpredictable. Also, the US stock return volatility was marked by long memory process while the UK was non-stationary. These results were further supported by the ARFIMA-HYGARCH models. 2.3 Conclusion During the course of the literature review, limited evidence on weak form efficiency of African markets was found. These countries have attracted significant investment these last years and are of much importance to portfolio managers. Univariate time series analysis might be important tool for technical analysts in trying to outperform these markets. Indeed, the battery of econometrics software now paves the way for investigation of the random walk hypothesis based on different sets of assumption. A preliminary analysis of the African markets shall provide us with an insight to efficiency based on their attributes and consultation of previous works. GENERAL OVERVIEW OF THE AFRICAN STOCK MARKETS 3.0 Introduction African stock markets, following in the wake of the surge in the world stock markets over the few decades, are starting to take off. Recognizing the importance of stock markets in economic development, several African countries launched stock exchanges during the past two decades. The African Stock Exchange Association (ASEA) was, hence, set up in 1993 so as to promote the development of stock markets. Prior to 1989, there were just five stock markets in Sub-Saharan Africa and three in North Africa. Today, Africa has about 20 active stock markets, with some exchanges more established than others, depending on when they were established. Alongside the rapid expansion of stock markets in the continent, there has also been a significant growth in market capitalization and the number of listed companies. However, with the exception of the well established markets, stock markets in Africa remain thin and illiquid. This study covers four African stock markets namely South Africa, Mauritius , Morocco and Egypt over periods for which data is available. Mauritius Stock Exchange Since its start of trading on the 5th July 1989 under the Stock Exchange Act of 1988, the Mauritius Stock Exchange (SEM) has come a long way. From a pre-emerging market with trading taking place only once a week, the SEM has emerged as one of the leading exchanges in Africa. It operates two markets namely the Official and the Development and Enterprise market (DEM), established in August 2006 to replace the over-the-counter market. The exchange is regulated by the Financial Services Commission. As the second sub-Saharan stock exchange member of the World Federation of Exchanges, SEM operates in line with international standards. In addition, its developing institutional and retail investor base make it an attractive investment destination for foreign investors. The SEM offers quite a limited range of products to its investors and the aim for the next few years would be to increase the range of products offered. The three main indices of the official market are namely the SEMDEX, SEM- 7 and the SEMTRI. As at 30 June 2009, some 40 companies, with a market capitalisation of Rs 130.77 bn, are listed on the Official market and 52 companies, with a market capitalisation of Rs 45.41 bn, are listed on the Development and Enterprise Market (DEM). The SEM maintained an upward momentum, amidst typical market fluctuations, until the end of February 2008. The total market capitalization of the Official Market and the DEM was Rs 173.1 bn at end 2007. This is in line with the levels observed in well-established emerging stock markets. However, like other exchanges, the SEM experienced market volatility since the start of the financial crisis in September 2008. The main pillars of the Mauritian economy were adversely affected and this reflected on hotels and banks stocks listed on the SEM. The market then picked-up by mid-March 2009 on the back of interest rate cuts and stimulus packages put forward by the Government of Mauritius. Johannesburg Stock Exchange The Johannesburg Stock Exchange (JSE), regulated by the Financial Services Board under the Securities Services Act 2004, is the largest exchange in Africa and among the top twenty largest in the world in terms of market capitalisation. JSE Securities Exchange existed since November 1887 and was incorporated as a public limited company on 1st July 2005, pursuant to its demutualization. Since then, the JSE has evolved from a traditional floor based equities trading market to a modern securities exchange providing fully electronic trading, clearing and settlement in equities, financial and agricultural derivatives and other associated instruments and has extensive surveillance capabilities. Technical agreement with the London Stock Exchange (LSE) enables dual primary listings on both exchanges since 2001. Between the listed entity and its trusted trading platforms the South African economy becomes an active hub of activity where expansion is encouraged, businesses are enhanced, performa nce is driven and shareholder value is created. The JSE currently operates four boards for the equities market and the South African bond market is a leader among emerging-market economies. The main market indices are Top 40, Industrial 25, All Share, Oil and Gas Index. As the gateway to Africas economy, the JSE provides the link between international markets and the continent. In 2008, a daily average of 334 million shares was traded on the JSE. At year-end, there were 992 listed securities on the JSE with a total market capitalisation of R4,514 billion compared to R5,696 billion in 2007. Casablanca Stock Exchange Founded in 1929, the Casablanca Stock Exchange (CSE) in Morocco is relatively modern, having experienced reform in 1993. The exchange is well regulated by the Conseil Deontologique des Valeurs Mobilieres (CDVM). Originally, CSE had the Index de la Bourse des Valeurs de Casablanca (IGB) but this was replaced on January 2002 by two indexes: MASI (Moroccan All Shares Index) which comprises all listed shares, allows to follow up all listed values and to have a long-term visibility and MADEX (Moroccan Most Active Shares Index), comprisi