Domestic, Foreign InvestorsTraded N1.51trn Equites in Five Months

The total value of domestic and foreign investors transactions on the equities market of the Nigerian Exchange Limited (NGX) in five months of 2022 has increased to N1.51 trillion, representing an increase of from 61.3 per cent from N933.65 billion total transactions carried out in the corresponding period of 2021.

In a report released by NGX Regulation Limited, the Domestic and Foreign Portfolio Investment (FPI) May 2022 report captured these transactions as well as trading figures from market operators. Additionally, domestic investors have continued to hold ground on the floor of the NGX despite rising inflation and currency volatility in the foreign exchange market which remained key drivers of the Domestic & Foreign Portfolio Investment.

Capital market analysts stated that local investors are taking advantage of the incredibly low prices of stocks in NGX to increase their investments.

They explained that local investors are increasing their stake in the equities market due to the attractive dividend yield in the market and because of the low yield environment in the fixed income market. They observed that the development is good for the local bourse, saying that it would restore credibility and stability to the market, which was hitherto marred by volatility occasioned by the activities of foreign investors.

Further analysis has shown that foreign transactions stood at N201.29 billion, accounting for about 13.37 per cent of the total transactions carried out from January to May, while domestic transactions constituted N1.304 trillion, representing 86.63 per cent of the total transaction, outperforming the foreign investment during the same period.

Analysis of domestic transactions showed that institutional investors outperformed retail investors. A comparison of domestic transactions in the period under review revealed that retail transactions pulled N408.03 billion in investment, while institutional investors’ investment amounted to N896.21 billion from January to May 2022.

For May, total transactions at the nation’s bourse increased by 195.05 per cent from N205.88 billion (about $494.26 million) in April 2022 to N607.45billion (about $1.45 billion) in May 2022.

A Mutual fund (Unit Trust) is an investment vehicle managed by a SEC (Securities and Exchange Commission) registered Fund Manager. Investors with similar objectives buy units of the Fund so that the Fund Manager can buy securities that willl generate their desired return.

An ETF (Exchange Traded Fund) is a type of fund which owns the assets (shares of stock, bonds, oil futures, gold bars, foreign currency, etc.) and divides ownership of those assets into shares. Investors can buy these ‘shares’ on the floor of the Nigerian Stock Exchange.

A REIT (Real Estate Investment Trust) is an investment vehicle that allows both small and large investors to part-own real estate ventures (eg. Offices, Houses, Hospitals) in proportion to their investments. The assets are divided into shares that are traded on the Nigerian Stock Exchange.

GUIDE TO DATA:

Date: All fund prices are quoted in Naira as at 21June-2022, unless otherwise stated.

Offer price: The price at which units of a trust or ETF are bought by investors. Bid Price: The price at which Investors redeem (sell) units of a trust or ETF.

Yield/Total Return: Denotes the total return an investor would have earned on his investment. Money Market Funds report Yield while others report Year- to-date Total Return. NAV: Is value per share of the real estate assets held by a REIT on a specific date.