تThe Impact of Financial Portfolio Diversification on Securities Return and Liquidity An Applied Study in Khartoum stock exchange Market- Sudan

Abstract

 The study aimed to examine the relationship between the diversification in portfolio and it impact on the return, liquidity of investment portfolio as mediator.  Research sample consist of investors in Khartoum stock exchange in Khartoum state Sudan.  The sample was taken by – random probability sampling.  In addition, the sample was taken from the investors who were still own the investment portfolio.  This was done to facilitate the distribution of questionnaires and the return and accuracy of answers given by the investors.  The analysis technique used in this research is quantitative data analysis technique using Path Analysis modeling using (AMOS v 25).   The results revealed the diversification and liquidity have positive impact on returnBecause it different form zero at 0. 05 level of significance.  And the diversification in portfolio doesn’t affect the liquidity at 0. 05 level of significance.  Also liquidity un mediated the relationship between the diversification and return at 0. 05 level of significance.  Most of investors invest in different economic sectors & study overall components of investment portfolio.  Also previous loss it makes investors more attention, Exchange rate effect on investor’s investment decision, beside that Safety in investment is first for investors.  The recommendation is Observation of individual portfolio suggest that people do not hold portfolio that are well diversified the investor don’t care to invest in sectors that have less correlations (assets components of portfolio).   The investor simply ignorant about benefit of diversification education may be solution.  Secondly the achieved return of portfolio should be near to expect return should have known much about investor’s goals and preferences to develop framework that describes how they form portfolio.  Thirdly Khartoum stock exchange management should take care of marketing the financial securities.  And make it easy to increase the efficiency of market. .  The study makes theoretical contributions to body knowledge of portfolio management on economic environment.  Practically, the study provides useful knowledge for investors to improve the construction and management of their portfolio.  

Keywords: investment portfolio management, diversification, liquidity, return on investment.