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NSE moves to protect investors using brokers’ online trading portals

By BusinessNews Staff on June 26, 2015

The Nigerian Stock Exchange (NSE) is making moves to give investors using the online trading portals of stockbroking firms adequate protection as the exchange is coming out with new Rules in that regard.

The launch of a new trading platform(XGEN) by the NSE two three yeas ago has made it possible for stockbroking firms to introduce online trading portals to enhance investor experience. Many firms have launched their trading portals that are linked to the NSE trading engine and enable investors trade from outside the exchange.

However, aware of the risks that comes with this development, the NSE has decided to give adequate protection to investors who trade securities via stockbroking firms’ portals.

Consequently, the exchange is proposing new rules titled ‘Online Trading Portal’ for the market. According to the NSE the rules are being proposed to ensure that investors who trade in securities via Dealing Members’ online portals are adequately protected against unauthorized access to their stockbroking accounts by unauthorized persons, and protected against all forms of cyber-misconduct.

“The proposed Rules aim to guide Dealing Member firms on the standards, processes and basic requirements for the operation of online trading platforms. The Rules also set out obligations and responsibilities of Dealing Members that offer online trading services, requirements on – infrastructure, know-your- client, risk management and supervisory control and disclosures to clients,” NSE said.

However, the exchange has asked operators to comment on the rules within the next two weeks before they are made effective after the necessary regulatory approval.

Meanwhile, trading at the stock market remained bearish yesterday with the NSE All-Share Index declining by 0.34 per cent as sell off pressure hit the financial services and consumer goods sectors.

The ASI closed lower at 33,266.87, while market capitalisation shed N39.11 billion to be at N11.36 trillion.

Forty-two stocks declined compared to only nine that appreciated.

Only one out of the five sectoral indices appreciated, while the remaining four closed negatively. Price gains by Mobil Oil Nigeria Plc and Oando Plc led to 0.09 per cent growth in the NSE Oil/Gas Index.

Conversely, the NSE Insurance Index recorded the highest decline of 1.55 per cent. The NSE Banking, Consumer Goods and Industrial Goods Indices followed with 0.52 per cent, 0.30 per cent and 0.09 per cent respectively.

[ThisDay]

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