With the penny price nature of most listed equities, The Nigerian Stock Exchange has advised investors to buy companies shares now, particularly when their prices are relatively low.

The Executive Direc-tor, Market Operations and Information Technology of the NSE, Mr Ade Bajomo, said that after the current bearish market, there would be a bullish market and “what we do in terms of turning the market around is the launching of first Exchange Traded Fund and the market segmen-tation.”

He attributed the bearish market to the global liquidity squeeze, adding, “This is the first time Nigeria has seen a bearish market, as the country is not used to it because the market was always going up.”

He added that the reduction of the 33 sectors in the equities to 12 was in line with the best global practices and would allow people to analyse and build diversified portfolio.

He stressed that “ETF is a fastest growing product in the global capital market and it is very useful, as it helps with diversification of investments,” noting that the market had to move away from a situation where people were buying only equities.

He said, “ETF can be backed by any assets class. So, the one launched is backed by gold. You can also have ETF backed by basically equities. So, you have a basket of equities. For example, you can have FirstBank of Nigeria Plc, Nigerian Breweries Plc, Guinness Nigeria Plc. So, rather than buy one share which is one of the problems of the past, you buy a basket of shares which gives you diversified portfolio.”

The Exchange recently listed the first ETF valued at N1.01 billion, making it the third African country where the product was launched.

Speaking at the launching, Head of Invest-ments at Absa Capital, Dr Vladimir Nedeljkovic, said that the inclusion of the product on the Exchange allows both individual and institutional investors direct access to an efficient and cost effective means to invest in gold through a listed security.

According to him, the listing is expected to help develop the investor market in Nigeria, as one of the fastest growing economies by widening the choice of asset classes available to local investors, as well as to increase significantly the liquidity on the NSE.

He said, “historically, gold has demonstrated its role as an effective portfolio diversifier, a store of value and a safe haven investment in uncertain economic times, as well as an excellent currency hedge.”

He pointed out that the product had proved to be one of the best performing ETFs in South Africa over five years, with one year return of 41.5 per cent, two years return of N26.02 per cent and three years return of 18.9 per cent.

The Chief Executive Officer of the NSE, Mr Oscar Onyema, said the listing marked a milestone in the Exchange’s commitment to the rebirth and growth of the Nigerian capital market.