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Domestic transactions in equities rise by N46.7bn

By on August 26, 2013

The total value of domestic transactions carried out by investors on the Nigerian Stock Exchange in June, 2013 stood at N143.59bn, representing an increase of N46.74bn or 48.2 per cent over N96.85bn recorded the previous month.

Domestic transactions are made up of both retail investments and institutional investments on the NSE.

Findings by our correspondent from the NSE on Friday, which gave the figures also showed that retail investments accounted for 33.30 per cent of the total transactions, while institutional investments were 66.70 per cent of the amount.

A retail investor, also known as an individual investor or a small investor, is one who buys and sells securities for his personal account and not for another company or organisation; while an institutional investor is a non-bank person or organisation that trades securities in large share quantities.

In the month of May, the total value of equities exchanged by investors stood at N101.03bn, showing a significant increase of N12.52bn or 14 per cent compared to the N88.51bn worth of shares exchanged in the month of April, the NSE stated.

The value of equities represents the value of a company available to owners or shareholders.

Speaking on this, the Chief Executive Officer, NSE, Mr. Oscar Onyema, attributed the increased activities to the rising level of investor confidence in the market.

This, he added, was also visible from the increase in the major market indicators of the NSE, compared to the figures recorded in the corresponding period of previous years.

Onyema said that there had been increased participation in the market by both local and foreign investors, adding that this had translated into more domestic transactions on the Exchange.

He said, “It is important to note at this point that our local investors have started to return to the market and we are very hopeful that we will see more of this going forward this year, we at the Exchange are bullish that the market would pick up further this year.

“I would like to state here that the Nigerian stock market has been cleaned up to give good returns to investors and our market is too big to be ignored by foreign investors who are looking to take advantage of the opportunities offered by the African markets and other emerging economies, and this is what has kept these investors.”

The Managing Director, Partnership Investment Company Plc, Mr. Victor Ogiemwonyi, said the increased participation of investors in the Nigerian market was heart warming.

This, he noted, was an indication of the level of returns that investors had recorded in the market within the year.

“Going forward, we expect the stock market to perform well in 2013 due to a number of far reaching initiatives by the regulators. Also, confidence boosting measures by the NSE in trying to enforce compliance by listed firms in filing quarterly reports will no doubt buoy the market,” he said.

A stockbroker, Mr. Ariyo Olushekun, said a lot of investors were taking position in the equities market ahead of more expected rise in the market transactions.

He said, “We are pleased to note that recovery has already commenced in our market and we are sure that this recovery would be sustained. Already, you would notice that we have significant year-to-date returns in the market.

“All indications point to the fact that we are going to see even more growth in the months ahead, and we can see this from the way that both local and foreign investors have been playing in the market in the last two years, taking advantage of the undervalued prices of major companies.”

In 2012, the total value of equities traded on the NSE was N658.22bn or $4.23bn.

This amount showed an increase of N23.3bn or 3.67 per cent over N634.92bn or $4.18bn recorded at the end of 2011.