An Empirical Examination of Clustering at Bahrain Bourse (BHB)

Classifying the firms listed at stock exchanges basing on their similar characteristics can be put away one of the major challenges on investors' behalf in information-rich stock markets. In this paper, we discuss and examine whether the firms listed at Bahrain Bourse (BHB) can be grouped based on the mean and standard deviations of daily returns within the context of Ward's method under the hierarchical clustering techniques over the period of January 2010 and August 2012. Findings indicate that the firms can be grouped into three main clusters