In line with its mandate to develop and deepen the Exchange Traded Fund (ETF) market, Nigerian Exchange (NGX) organised capacity building to equip stakeholders with requisite insights on ETFs market.
In his opening remarks at the NGX ETF Capacity Building Webinar with the theme ‘Unlocking ETF Opportunities in Nigeria: Structuring and Application process’, the Acting CEO of NGX, Mr. Jude Chiemeka said “we are pleased to host this event in partnership with Vetiva Capital Management Limited, as we seek to explore the immense potential ETFs hold in the Nigerian capital market.
“We believe that your participation is an indication of your keen interest and dedication toward the development of ETFs in the Nigerian capital market.”
He noted that over the years ETFs have gained more acceptability among institutional and retail investors worldwide due to their cost-effective approach in providing exposure to a diverse array of underlying asset classes.
According to ETFGI the global ETF industry continues its remarkable growth trajectory, with assets under management crossing $13 trillion mark in March 2024. The industry now spans over 12,127 products, listed across 80 exchanges in 63 countries, offered by 741 ETF providers. In March 2024, ETFs garnered net inflows of $144.94 billion, underscoring the rising appeal amongst both institutional and retail investors.
Equity ETFs reported net inflows of $94.62 billion in March, bringing YTD net inflows for Equity Based ETFs to $235.75 billion, this is reflective of a 678 per cent YoY increase (when compared to $30.31 billion net inflows in the same period in 2023). YTD 2024, Fixed income ETFs have gathered net inflows of $61.85 billion, while ETFs with commodities products as underlying have reported net inflows of $1.15 billion YTD 2024.
Chiemeka said that investors in Nigeria also have an excellent opportunity to diversify their portfolios and gain exposure to various underlying asset classes at lower costs through the ETFs listed on the Nigerian Exchange.
He added “since the inception of ETFs in Nigeria in December 2011, the market has grown steadily, with a total market capitalization of N35.76 billion as at April 2024.
“The Exchange currently offers 12 ETFs, consisting of equity-backed, commodity, and bond ETFs, providing investors with limitless opportunities to diversify their investments. Despite this advancement in the ETF space in Nigeria, there is a need to deepen the ETF market so as to provide more investible products for investors.”
He explained that this capacity building event is aimed at equipping capital market stakeholders with requisite insights on ETFs covering; Fundamentals of ETFs, including their structure, operations and investment approach; and the step-by-step process for bringing ETF products into the market.
He further said “this webinar presents a unique opportunity for us to engage in meaningful discussions, share best practices, and equip ourselves with the knowledge and skills necessary to capitalize on the burgeoning ETF market in Nigeria.
“By unlocking the potential of ETFs, we can contribute to the development and growth of the Nigerian capital market, enhance investment opportunities, and ultimately drive economic prosperity.”
“The Exchange no doubt remains highly invested in providing an efficient, liquid and transparent market for investors and businesses in Africa, to access capital and build wealth,” NGX acting CEO said.
NGX Exchange Traded Funds (ETFs) Capacity Building Event 2024 is in collaboration with Securities and Exchange Commission (SEC), Vetiva Capital Management Limited, Adele Hattingh (Exchange Traded Product Manager, and Johannesburg Stock Exchange, JSE).
