Domestic investors trade ₦17.7tn in equities in 18 months

Data from the NGX shows domestic retail and institutional investors traded ₦17.7 trillion in equities over the past 18 months, driven by investor confidenceand a shift away from forex exposure.

Data from the Nigerian Exchange Limited (NGX) revealed that domestic retail and institutional investors traded ₦17.7 trillion in equities over the past 18 months. Market analysts attribute the sustained domestic liquidity surge to investor confidence in corporate earnings and a shift away from foreign currency exposure.

The high level of domestic trading activity is a positive sign for the Nigerian capital market. It suggests that investors are confident in the prospects of Nigerian companies and are willing to invest in the market. The shift away from foreign currency exposure is also significant, as it suggests that investors are becoming more comfortable with the naira.

This echoes the 2021 domestic trading surge, which also saw high levels of activity. The mechanism then was different, but the result was the same: a vibrant domestic capital market.

The winners: domestic investors, who have benefited from the market’s performance; and the NGX, which has seen high levels of activity. The losers: the Nigerian government, which must ensure that the market remains attractive; and the Nigerian public, who must wait for the benefits.

Bottom Line: Domestic investors traded ₦17.7 trillion in equities. The market is vibrant. The question is whether the momentum can be sustained.