The Nigerian Stock Exchange (NSE) in partnership with some market participants on Friday launched Mutual Fund trading and distribution platform.
The participants are the Fund Managers Association of Nigeria (FMAN); Association of Stockbroking Houses of Nigeria (ASHON) and the Central Securities Clearing System (CSCS) Plc.
The platform will bring together market participants to facilitate electronic transactions with seamless interaction between NSE, CSCS, Fund Managers and Brokers Dealers.
Mutual Fund is a pool of funds brought together by a professional fund manager from several investors to invest in selected underlying securities.
Speaking at the launch in Lagos, Mr Olumide Bolumole, Head of Listing Business Division, NSE, said that the exchange was delighted to provide a solution that would enhance visibility for the listed mutual funds.
“We are delighted to provide a solution that 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”, Bolumole said.
Mr Haruna Jalo-Waziri, CSCS Managing Director, described the launch as a milestone for the Nigerian Capital Market.
“This 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,” Jalo-Waziri said.
He said that CSCS had invested heavily in technology that would provide seamless post-trade services to a wide range of financial instruments, including collective investment schemes.
Jalo-Waziri said that 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.
Mr Dayo Obisan, FMAN President, said that it was a great pleasure to see the platform launched and become operational.
Obisan said that one of initiatives in the FMAN five-year road map was to develop and implement a nationwide distribution/trading platform for mutual funds.
He said that NSE, CSCS, ASHON and the Securities and Exchange Commission (SEC) worked closely with FMAN over the past 18 months to attain the great milestone.
Also, the ASHON Chairman, Mr Patrick Ezeagu, in his remarks, said that the association was delighted to be part of the project.
“We in the ASHON are highly delighted to have been a part of the development and emergence of the Memorandum Trading Platform.
“The project was directed at reawakening the small savers in order to take advantage of investing via mutual fund to have the synergistic benefit of a better return in the market”.
“We cherish the relationship we have built in the course of this project with the FMAN and the NSE, we have the firm belief that this success story will transcend to other areas of the capital market.
“The Memorandum Trading Platform will facilitate the ease of doing business in trading and distribution of Mutual Funds as well as inspire small savers, thereby promoting financial inclusion, which is an important focus of our members.
“We congratulate everyone that contributed to the success of this initiative and encourage all operators to embrace this new aspect of deepening of our market which is a formidable incursion into an erstwhile grey sector”, Ezeagu said.