Kenya's bourse, East Africa's largest, plans to introduce derivatives and property investment trusts after equity trading volumes declined, based on the financial-markets regulator.
The Capital Markets Authority will probably approve the introduction of futures products, with a focus on interest-rate and foreign-exchange derivatives, and asset-backed securities by December, Paul Muthaura, the regulator's acting chief executive officer, said. Exchange-traded funds might be started next year, he said. The FTSE NSE Kenya 25 index has gained 23 percent this year, with the nation's main stocks assess the third-best performing in Africa after Ghana and Nigeria.
“The newest array of products will deepen the marketplace,” he explained in an interview in Nairobi, the capital, July 8. “Providing new investment opportunities will attract more foreign investors buying a variety of investment options and allow local investors to spread their investment and tap into new sources of raising capital for projects.”
Kenya's Nairobi (NSEASI) Securities Exchange, which trades stocks and bonds, is sub-Saharan Africa's third-biggest bourse and its market capitalization is less when compared to a 20th how big South Africa and about a quarter of Nigeria.
The amount of stocks traded in Nairobi fell to 5.46 billion in 2012 weighed against an archive 7.55 billion in 2010 and 5.72 billion in 2011, data supplied by the exchange show. Almost 46 billion shares were traded on South Africa's FTSE/JSE Africa All Share index this past year, in accordance with data compiled by Bloomberg.
‘High Potential'
The sum total value of bonds traded in Kenya this past year was 1.14 trillion shillings ($13 billion), based on the exchange. That compares with 2.18 trillion rand ($216 billion) in South Africa, in accordance with Bloomberg calculations based on data supplied by the Johannesburg Stock Exchange.
“There is high potential in raising funds from institutional investors, foreign investors and high net worth individuals through the introduction of the new services,” Kenneth Kaniu, chief investment officer at Nairobi-based Stanlib Kenya Ltd., a system of Standard Bank Group Ltd., with 170 billion shillings under management, said by phone.
Three investment funds have put on list REITs, Muthaura said, without identifying the companies. REITs are companies which have property-linked assets and spend most of the income to investors through distributions. The South African REIT Association was started in May after six years of talks to generate regulations for a, which will be set to end up being the world's eighth largest REIT market with 26 companies, in accordance with its website.
Institutional Investors
“The REITs will target institutional investors and high-net-worth individuals with a minimum of 5 million shillings per unit to make certain sufficient funds are raised within the shortest time,” Muthaura said.
Housing Financing Co. Ltd., Kenya's just publicly dealt mortgage lender, claimed last week it wants the us government to exempt REITs from spending duty on capital gains. Housing Financing plans to really have a share in REITs as a supervisor, land manager and property builder as well as trustee, offering as a custodian of resources held by way of a trust. Centum Expense Co., Kenya's biggest publicly dealt expense party, can also number a real-estate project as a REIT, Nairobi-based Company Daily newspaper reported last year.
The trade can present two lessons of REITs. One can concentrate on present commercial properties making hire income and minimum fund measurement of 300 million shillings. Another can goal properties under development with more than 100 million shillings in capital, Muthaura said.
Commodity Instruments
The planned futures and derivatives trade will even contain commodity devices, Muthaura said. Rules for the market is likely to be prepared by the following month, he said.
The introduction of asset-backed securities will help fund energy, water, train and street projects in Kenya, Muthaura claimed, without giving details. Kenya's government has budgeted to pay 442 million shillings on infrastructure in the fiscal year to August 30, 2014.
The regulator claimed July 8 it plans to present exchange-traded funds and is seeking a specialist to produce regulations. Unlike a good fund, the shares which are priced day-to-day after the end of every trading program, an ETF is stated on a change where it's bought and sold throughout the day.
“The brand new expense devices will give you a way to diversify expense portfolios,” Vimal Parmar, the Nairobi-based head of research for Burbidge Capital, claimed by telephone yesterday.
Regional Platform
The authority can also be in talks with Tanzania, Uganda and Rwanda, who are customers of the five-nation East African-american Neighborhood, about giving a system for firms to raise capital in various markets simultaneously, Muthaura said. Burundi, the sixth member, does not have a capital market.
“We are preparing to co-ordinate approval method allowing firms to issue multi-currency debt devices,” with one software already being prepared, Muthaura said.
The FTSE NSE Kenya 25 List received for a sixth day recently, hiking 0.6 percent to 157.91. The measure has advanced 23 percent so far this year.
The Capital Markets Authority will probably approve the introduction of futures products, with a focus on interest-rate and foreign-exchange derivatives, and asset-backed securities by December, Paul Muthaura, the regulator's acting chief executive officer, said. Exchange-traded funds might be started next year, he said. The FTSE NSE Kenya 25 index has gained 23 percent this year, with the nation's main stocks assess the third-best performing in Africa after Ghana and Nigeria.
“The newest array of products will deepen the marketplace,” he explained in an interview in Nairobi, the capital, July 8. “Providing new investment opportunities will attract more foreign investors buying a variety of investment options and allow local investors to spread their investment and tap into new sources of raising capital for projects.”
Kenya's Nairobi (NSEASI) Securities Exchange, which trades stocks and bonds, is sub-Saharan Africa's third-biggest bourse and its market capitalization is less when compared to a 20th how big South Africa and about a quarter of Nigeria.
The amount of stocks traded in Nairobi fell to 5.46 billion in 2012 weighed against an archive 7.55 billion in 2010 and 5.72 billion in 2011, data supplied by the exchange show. Almost 46 billion shares were traded on South Africa's FTSE/JSE Africa All Share index this past year, in accordance with data compiled by Bloomberg.
‘High Potential'
The sum total value of bonds traded in Kenya this past year was 1.14 trillion shillings ($13 billion), based on the exchange. That compares with 2.18 trillion rand ($216 billion) in South Africa, in accordance with Bloomberg calculations based on data supplied by the Johannesburg Stock Exchange.
“There is high potential in raising funds from institutional investors, foreign investors and high net worth individuals through the introduction of the new services,” Kenneth Kaniu, chief investment officer at Nairobi-based Stanlib Kenya Ltd., a system of Standard Bank Group Ltd., with 170 billion shillings under management, said by phone.
Three investment funds have put on list REITs, Muthaura said, without identifying the companies. REITs are companies which have property-linked assets and spend most of the income to investors through distributions. The South African REIT Association was started in May after six years of talks to generate regulations for a, which will be set to end up being the world's eighth largest REIT market with 26 companies, in accordance with its website.
Institutional Investors
“The REITs will target institutional investors and high-net-worth individuals with a minimum of 5 million shillings per unit to make certain sufficient funds are raised within the shortest time,” Muthaura said.
Housing Financing Co. Ltd., Kenya's just publicly dealt mortgage lender, claimed last week it wants the us government to exempt REITs from spending duty on capital gains. Housing Financing plans to really have a share in REITs as a supervisor, land manager and property builder as well as trustee, offering as a custodian of resources held by way of a trust. Centum Expense Co., Kenya's biggest publicly dealt expense party, can also number a real-estate project as a REIT, Nairobi-based Company Daily newspaper reported last year.
The trade can present two lessons of REITs. One can concentrate on present commercial properties making hire income and minimum fund measurement of 300 million shillings. Another can goal properties under development with more than 100 million shillings in capital, Muthaura said.
Commodity Instruments
The planned futures and derivatives trade will even contain commodity devices, Muthaura said. Rules for the market is likely to be prepared by the following month, he said.
The introduction of asset-backed securities will help fund energy, water, train and street projects in Kenya, Muthaura claimed, without giving details. Kenya's government has budgeted to pay 442 million shillings on infrastructure in the fiscal year to August 30, 2014.
The regulator claimed July 8 it plans to present exchange-traded funds and is seeking a specialist to produce regulations. Unlike a good fund, the shares which are priced day-to-day after the end of every trading program, an ETF is stated on a change where it's bought and sold throughout the day.
“The brand new expense devices will give you a way to diversify expense portfolios,” Vimal Parmar, the Nairobi-based head of research for Burbidge Capital, claimed by telephone yesterday.
Regional Platform
The authority can also be in talks with Tanzania, Uganda and Rwanda, who are customers of the five-nation East African-american Neighborhood, about giving a system for firms to raise capital in various markets simultaneously, Muthaura said. Burundi, the sixth member, does not have a capital market.
“We are preparing to co-ordinate approval method allowing firms to issue multi-currency debt devices,” with one software already being prepared, Muthaura said.
The FTSE NSE Kenya 25 List received for a sixth day recently, hiking 0.6 percent to 157.91. The measure has advanced 23 percent so far this year.
