NSE Lists Stanbic IBTC Pension ETF 40 to drive market liquidity

Stanbic IBTC Asset Management Limited (SIAML) on Tuesday listed 10 million units of its Pension ETF 40 fund on the Nigerian Stock Exchange (NSE) as one of the Exchange Traded Funds (ETF) for trading on its floors.

According to Chief Executive, Stanbic IBTC Asset Management Limited (SIAML), Bunmi Dayo-Olagunju, The Pension ETF 40, created to closely replicate the total return of the NSE Pension 40 index  Fund, was designed to provide investors access to the most liquid publicly quoted companies on the NSE that are compliant with the regulatory requirements for investing pension assets.

Highlighting some of the benefits of the ETF, Dayo-Olagunju said it would provide investors with a strategic exposure to the equities market, allowing for flexibility, cost effectiveness, diversification of investment, as well as liquidity. She added that it would act as a benchmark for PFAs to measure performance and report same to Retirement Savings Account (RSA) holders.

In his presentation to stockbrokers and financial journalists, at the facts behind the Stanbic IBTC Pension ETF 40 on Tuesday, Shuaib Audu an Executive Director at Stanbic IBTC Asset Management Ltd noted that the fund expects to pay out 90 percent of all of its net earnings to its unitholders every quarter. The fund manager reserves the option to automatically reinvest cash distribution into the fund and issue additional units to unitholders subject to their qualification on the record/closure date, he added.

NSE CEO, Mr Oscar Onyema, commended SIAML for contributing towards the growth of ETF market, while he advised on the need for investors’ educations as awareness is still low. He urged stockbrokers to support the product by introducing it to their clients

The MD of APT Securities, Mallam Garba Kurfi, affirmed to our correspondent that more education needs to be taken to retail investors especially investors at the grassroots.

“I deal primarily with retail investors, of which I have over 40,000, however not a single one of these investors have asked me to purchase an ETF since its inception,” he said.

Mallam Kurfi noted that the success recorded with the product that was launched in the country in 2011 started in the last two years. He, therefore, urged the regulatory bodies i.e the NSE and the SEC to deepen education from the masses by taking a cue from how the MMM Ponzi scheme gained popularity, citing that better funding for the education of  ETF will further deepen its success rate.