Abstract: The critical economic transformation of Kenya’s economy has been blueprinted at the ideal level of short-term liabilities. Financial stability has resulted from the effects of achieving equity and liability balance. Debt on the short term is essential to a company’s performance when it has a strong trade position. The company makes the most of its trading position to make money. Additionally, borrowing in the short term is essential when investing in projects with a positive net value. The study sought to evaluate the effect of commercial trade position on short term debt on companies listed on Nairobi securities exchange. The study was anchored on pecking order theory and risk and return theory. The study utilized descriptive research design. The study targeted all fifty four firms that were listed on Nairobi securities exchange from 2007 to 2011. The study collected secondary data from annual accounting report of quoted firms on Nairobi securities exchange. Data analysis was performed in order to convert obtained data into a format that can be used for interpretation and conclusion. The study was based on panel data, the analysis will be based on panel regression. Result demonstrated a negative and significant effect between commercial trade position and short term debt. The study recommended inter-firm trade should therefore be encouraged as this is a form of internal financing.
Keywords: Commercial Trade Position, Panel Regression, Pecking Order Theory, Risk and Return Theory, Short Term Debt.
Title: COMMERCIAL TRADE POSITION AND SHORT TERM DEBT OF FIRMS QUOTED ON THE NAIROBI SECURITIES EXCHANGE, KENYA
Author: Oliver Mukweyi Pyoko, Renson Muchiri
International Journal of Social Science and Humanities Research
ISSN 2348-3156 (Print), ISSN 2348-3164 (online)
Vol. 11, Issue 3, July 2023 - September 2023
Page No: 190-194
Research Publish Journals
Website: www.researchpublish.com
Published Date: 12-September-2023
