The Securities and Exchange Commission (SEC) and the Chartered Institute of Stockbrokers (CIS) have reached a consensus to priotise investor education in a bid to boost the participation of domestic investors in the nation's capital market.
About 60 per cent of the Nigerian Stock Exchange is currently dominated by foreign investors while only about three million Nigerians are believed to be participating in the market.
However, the acting Director General, SEC, Alhaji Mournir Gwarzo said enhanced investor-education remains key to altering the current balance and encouraging the development of domestic retail and institutional investors.
Speaking to journalists yesterday in Abuja shortly after a meeting with members of the Chartered Institute of Stockbrokers (CIS) led by its President, which paid him a courtesy visit, Gwarzo also stressed the need to have a strong regulator as well as fit and proper operators to drive the development of the market.
He said the commission would consider areas of assistance to operators in order to boost investor education while SEC would also "looked at areas we also think they should also step up."
He said: "We are going to step up our investor education programmes; we are going to collaborate with both the trade association so that we will be able to reach out to the markets. We believe by the time we do so well in terms of investor education, the level of investment from the capital market particularly the domestic side would go up."
He added that on the international front, an enabling environment had already been created foreign investors and was still being improved upon. "The rules are very friendly, we amend our rules as much as possible to meet international standards," he said.
Meanwhile, the President/Chairman, Governing Council, CIS, Mr. Albert Okumagba described the current savings mobilisation platforms as weak especially as it related to collective investment schemes, insurance, pensions and banking products. He said the focus would be to pursue the inclusion plan for country by training and enhancing local participation.
He said with the leadership of SEC, "We are going to train people and we are going to help in broadening the participation of Nigerians so that to mobilise the savings we need to fund the infrastructure gaps across the country can be mobilised."
He said: "When these savings are mobilised locally, both from retail and institutional side, then it makes the Nigerian economy more attractive.
"A situation where foreign investors dominate our market is not in our long term interest. We have to revamp all the plans we have in mobilising savings."
He added that notwithstanding the problems in the market in 2014 and parts of 2015, the future of the Nigerian capital market remained bright based on the new approach from the regulator and government.
The Chairman, Association of Stockbroking Houses of Nigeria (ASHON), Mr. Emeka Madubuike also stressed the need to encourage both local and institutional investors noting that "now the current state of the market presents very good opportunity for investors to come into the market."
But for some legacy issues, a new enforcement regime by the capital market regulator is believed to have significantly reduced trading infractions and boosted investor confidence in the market