The Nigerian Stock Exchange (NSE), has said a new mutual fund trading platform launched at the weekend, will facilitate electronic transactions with seamless connection between NSE, CSCS, fund managers and brokers.
The Chief Executive Officer, NSE, Oscar Onyema, while speaking at the launch of the platform in Lagos, explained that the mutual fund will bring together market participants to facilitate electronic transactions with seamless interaction among the various stakeholders for the good of investors, who now have a single view of their investment.
According to him, the platform is the outcome of 18 months of intensive work by the various partners and the Securities and Exchange Commission (SEC).
He added that it is also expected to enhance visibility for the 76 mutual funds with Net Asset Value of over N600billion as at February 18, out of which 47 are listed on the NSE, while promoting financial inclusion, and stimulating retail investor participation in our market.
“This distribution platform is a new channel for accessing mutual funds, which are listed on the NSE. This restates our commitment to provide market operators, issuers, fund managers and investors with a reliable, efficient and an adaptable platform to create a more transparent, liquid and accessible market in line with global best practices.
“The platform will facilitate electronic transactions with seamless connection between NSE, CSCS, Fund Managers and Brokers. Investors have the benefit of a single view of their mutual fund investment while being able to invest with multiple fund managers through a single broker.”
The launch, he continued, provides an opportunity for the 256 brokers in the market to distribute to existing 13.9m investor accounts in CSCS and attract new investors that may be interested in gaining exposure to the capital markets through mutual funds.
The NSE boss expressed hope that with the launch of the initiative, the NSE will receive more applications for listing of mutual funds, even as he announced the listing of two funds each managed by First City Asset Management limited and Cordros Asset Management Limited. The funds are: FCAM Legacy Money Market Fund and Legacy Debt fund; Cordros Milestone Fund 2023 and Milestone Fund 2028 respectively.
The new platform is also expected to ease variety of transactions like subscription, redemption and cancellation, among others.
The Head of Listing Business Division, NSE, Olumide Bolumole, expressed delight at the initiative, which believes, “will enhance visibility for the listed mutual funds and promote financial inclusion, while stimulating retail investor participation in our market.
“This reinforces our commitment to provide market professionals, issuers, fund managers and investors with a reliable, efficient and an adaptable exchange hub in Africa, to save and to access capital. Through this platform investors can pool funds into chosen basket of securities, which have proven to be a veritable means to optimise returns and reduce risks.”
The Managing Director and Chief Executive, CSCS, Haruna Jalo-Waziri, said the trading platform for mutual funds “marks yet another milestone for the Nigerian capital market, and we believe that it will serve as a step towards improving the level of financial inclusion in Nigeria by giving investors varieties of investment products.
“As part of our commitment to providing far-reaching benefits to the capital market, CSCS Plc has proactively invested in technology that would enable us provides seamless post-trade services to a wide range of financial instruments including collective investment schemes.
“Additionally, fund managers can now augment their product distribution strength using the brokerage communities’ network. We believe this will also contribute towards increasing secondary market participation whilst growing funds under management for asset managers,” Jalo-Waziri added.
By Helen Oji
The Guardian Newspaper February 26th, 2019