Teaching Faculty

Ishmael Maina Macharia

Finance; CFA

I am an investment scientist and I study investing decisions of individuals and institutions with an emphasis on smoothing consumption amidst income fluctuations. Financial products are created around these needs for both individuals and institutions, and I am interested in evaluating the pricing of these products.

Currently, I am a lecturer at Strathmore University, Institute of Mathematical Sciences and prior to that I was lecturing at Strathmore University’s School of Accountancy.

I hold a Master of Commerce from Strathmore University and also hold the Chartered Financial Analyst, CFA, designation from the CFA Institute in Charlottesville, USA.

Working papers:

  1. Determinants of interest rate spreads in Kenya with Etemesi, D

Summary: Numerous variables exogenous to the operations of commercial banks have been touted in academic literature to be important factors causing the typically high interest rate spreads in developing countries. Using data for Kenyan banking sector, this paper uses Generalized Method of Moments technique to determine the macroeconomic and market determinants of banking sector interest rate spreads in Kenya. The empirical results suggest that bank development is the only significant variable and it affects interest rate spreads negatively. On the other hand, inflation rates, Total deposits, which is a proxy for bank intermediation, exchange rates, T-bill rates and loan to deposit ratio are insignificant.

  1. Forecasting the Time Varying-Beta of NSE-20 Share Companies with Maywa, N

Summary: This research paper forecasts the time-varying daily beta of ten stocks listed in the Nairobi Securities Exchange 20- Share Index by use of a Bivariate GARCH (1, 1) model and the Kalman filter method. Two measures of error are used: MAE and MSE. The results are inconclusive, based on MSE the Kalman method is superior while based on MAE, the Bivariate GARCH (1, 1) method appears to provide more accurate forecasts of the time-varying beta.

  1. Equity investment analysis: the case for a private university endowment with Njeri, L

Summary: The purpose of this study is to investigate the assertion that university and college endowments should maintain one hundred percent equity in their portfolios. An equity portfolio is compared to a traditional 60/40 portfolio in testing this assertion. A hypothetical private university is considered; with revenues originating from the fees paid by students, and these are required to fund the university’s operational budget. The study finds that the Nairobi All Share Index is indeed a sufficient proxy for a diversified equity portfolio and that equity returns are sufficient to fund an endowment portfolio for an institution of higher learning both in the long-run and short-run.

Master dissertation: Capital Structure of SMEs in Nairobi, Kenya, advisor Dr James McFie

Principles of Finance, Mid-year semester [2011, 2013, 2016.]

This course introduces undergraduate students to the theory of finance at a basic level emphasizing the time value of money

Investment Analysis and Portfolio Management [2011-2016]

This course introduces students to capital market theory, asset pricing and mean variance analysis as well as fixed income analysis and portfolio management

Investment Strategies and Portfolio Management [2014-2017]

Building up on investment analysis this course incorporates risk management using derivatives into portfolio management as well as performance attribution. It also helps students evaluate active and passive management strategies.

Email Address: imaina@strathmore.edu
Telephone Number: +254 703 034 214