Briefly outline the roles of participants in Capital Markets in Kenya

The main players in the Kenya Capital Markets include the Nairobi Stock Exchange (NSE),
the central Depository and Settlement Corporation (CDSC), Stock Dealers, Investment
Advisors, Fund Managers, Authorized Securities Dealers, Credit Rating Agencies, Collective
Investment Schemes, Custodians and Venture Capital Funds. The roles for each of the
market intermediaries are briefly outlined below:

Stockbroker
A stockbroker is a market professional who buys and sells securities on behalf of clients at
a Stock Exchange in return for a brokerage commission.

Investment Advisers/Fund Managers
An Investment Adviser and/or fund manager are market professionals who promulgate
analysis and research on capital markets securities and advise investors on such securities
at a commission. They also manage portfolios of securities on behalf of clients pursuant to a contract.

Authorized Securities Dealers
This is bank licensed under the Banking Act or financial institution approved by the
Authority to deal in fixed- income securities market segment at a stock exchange .
Authorized Securities Dealers are also required to act as market makers and dealers in this
market segment, facilitating deepening of the fixed income securities market , enhance
trading and liquidity in the fixed income securities market; and minimize counter party
risk. Investment Banks These are non deposit taking institutions that advise on offers of
securities to the public or a section of the public , corporate financial restructuring,
takeovers , mergers, privatization of companies, underwriting securities , etc. They can also engage in the business of a stockbroker, a dealer, and fund manager of collective
investment schemes and provider of contractual management services.

A credit Rating Agencies
A credit Rating Agent is a professional whose role is to give an objective and independent
opinion on the general creditworthiness of an issuer of a debt instrument and its ability to
meet its obligations in a timely manner over the life of the financial instrument based on
relevant risk factors including the ability of the issuer to generate cash in the future.

Venture Capital Funds
These are companies incorporated for purposes of providing risk capital to small and
medium sized business which are new and have a high growth potential, whereby not less
than 80% of the funds so invested consist of equity or quasi equity investments in eligible
enterprises.

---

NatalieR answered the question on June 16, 2022 at 11:25