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Risk and Return

  • Klas RönnbäckEmail author
  • Oskar Broberg
Chapter
Part of the Palgrave Studies in Economic History book series (PEHS)

Abstract

The aim of this chapter is to use the risk/return relationship to broaden the picture of the financial axis between the London financial market and Africa during our period of study. We use two central concepts in the analysis of financial risk—volatility and equity risk premium—to put our return estimates in context. We move on to analyse the relationship between the companies’ longevity in our sample and the return on investment. Our results show that investing in Africa was somewhat riskier than investing in the United Kingdom, which on an aggregate level corresponds with a somewhat elevated return on investment. Disaggregating the data by region in Africa at the same time shows that many investors were unable to receive a premium for the increased risk they faced.

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Copyright information

© The Author(s) 2019

Authors and Affiliations

  1. 1.Department of Economy and SocietyUniversity of GothenburgGothenburgSweden

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