2026 Investment Trends

The stock market offered investors the highest returns in the first half of 2026, ahead of fixed income assets and property, as a rally led by bank shares boosted investor wealth at the Nairobi bourse. Market capitalization—the measure of investor wealth—at the Nairobi Securities Exchange (NSE) was up 27.8 percent, or Sh817.2 billion, to reach a record high of Sh3.76 trillion as at June 30. This reaffirmed the Nairobi bourse as the shortest route to wealth in an economy that has oscillated between strong and soft growth. Treasury bonds issued in the six months offered investors annual interest payments of between 12 percent and 14.2 percent, before withholding taxes of 10 to 15 percent on the interest. 

In 2025, the Kenyan Equities market trading activity surged to KES 104.3Bn, a 59.5% uptick due to falling interest rates that led to the appeal of the equity asset class. The NSE 25 Index jumped 43.0%, due to a strengthening Kenyan shilling coupled with reduced credit default risks which renewed investor confidence in the equities market. The #NairobiSecuritiesExchange was the top-performing African market, posing to be a new era of equity-led portfolios in 2026.

I&M Group founder and director Suresh Raja Shah and his two sons have seen the value of their shares in the bank double to Sh17.35 billion following a 94 percent rally on the stock to an all-time high of Sh69.50 in the last one year. Mr Raja Shah holds a stake of 10.06 percent in the bank in his name, equivalent to 174.9 million shares, which are now valued at Sh12.16 billion, up from Sh6.25 billion a year ago. Mr Sarit Shah, who also serves as an executive director in I&M, has seen the value of his 37.6 million shares or 2.16 percent stake in the lender jump to Sh2.61 billion from Sh1.34 billion in June 2025. The 2.14 percent stake held by his brother Sachit Shah, who serves as a non-executive director, is now valued at Sh2.58 billion, from Sh1.33 billion previously. 

# THE UNINTENDED IMPACT OF THE CURRENT LOWERING OF RATES!

Decreasing returns on govt securities is fast driving down yields on MMFs and Treasury bills to single digits. The return on the 91-day Treasury bill fell below 9% for the first time since 2022 in the latest auction, after the latest rate cut by the (CBK).

The 91-day T-bill was auctioned at an interest rate of 8.9697% in the first week of February 2025, down from 9.1156 in the previous sale. Because MMF managers primarily invest in govt papers, there has been a subsequent fall in yields for MMFs. Analysts say investors in MMFs should expect lower returns this year compared to 2024. What to do..>>> 

Before you start investing, it’s essential to have an emergency fund in place to cover unexpected expenses without dipping into your investments. This fund acts as a financial safety net, ensuring you won’t be forced to sell investments at an inconvenient time, which could result in losses.

Ideally, this fund should hold three to six months’ worth of living expenses and be kept in a liquid, easily accessible account, such as a high-yield savings account. Having an emergency fund provides peace of mind and allows your investments to remain untouched and continue growing, even in the face of unforeseen financial challenges.

Many new investors attempt to time the market, hoping to buy at low prices and sell high. However, market prices fluctuate due to unpredictable factors, including economic reports, global events, and shifts in investor sentiment, all of which contribute to short-term volatility and reacting to them can lead to missed opportunities. Instead of trying to time the market, it’s often more effective to adopt a consistent, long-term approach.

E.g, dollar-cost averaging—investing a fixed amount at regular intervals regardless of price—allows you to steadily build wealth without being concerned with short-term ups and downs. This reduces emotional-investing and provides a way to buy shares at various prices, ultimately balancing out over time. Committing to a long-term strategy can yield more stable returns and a clearer path to building wealth.

Investing can be complex, and seeking professional advice when you need it can make a big difference. A qualified financial advisor can assist with setting realistic goals, developing a tailored investment plan, and navigating complex topics like taxes and retirement planning.

Find an advisor who aligns with your needs. These experts can provide clarity and confidence as you build your financial strategy. Even a single consultation can be valuable in helping you make informed decisions and avoid common pitfalls as you start your investing journey:

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