Securities and Exchange Commission (SEC) has expressed concerns that many young Nigerians are showing more interest in foreign stocks than local stocks.
According to the commission, about 70 percent of Nigerians buying into the foreign exchange market are between the ages of 18 and 40.
Speaking in an interview with Bloomberg, the executive commissioner for operations of the SEC, Dayo Obisan noted that at least 400,000 Nigerians have invested in foreign stocks through brokers in the past 18 months
“This is a concern, considering Nigerians actively trading or holding foreign equities now exceeds those investing in local collective investment schemes or mutual funds”
“Hence the commission has decided to actively monitor the local facilitators of foreign stocks in furtherance of our mandate of ensuring investor protection and market transparency,” he added.
“While we encourage young Nigerians to invest for their future, the increasing interest could create an avenue for exploitation if not well regulated” Obisan said.
Bloomberg report noted that SEC plans to license firms offering foreign stocks under so-called “digital sub-broker” regulations, which SEC says should provide a form of legitimacy for their activities.
The requirement will ensure “that regulatory responsibilities in on-boarding clients, custody of assets, and compliance with reporting requirements are met,” Obisan stated.
Ripples Nigeria can confirmed that in the last few years many Nigerians have showed increased interest in foreign investment especially in cryptocurrency as a means to hedge against inflation and naira devaluation.
In fact, Friday trading in Nigeria’s capital market ended with investors losing N40 billion amid reduced investors activities.
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