…outperforms foreign counterparts by 208.83%
The total value of transactions executed by domestic investors in the first two months of 2021 was N338.45 billion as against N109.59 billion total foreign transactions carried out during the period. Investigation by New Telegraph showed that the total value of domestic transaction outperformed that of foreign investors by N228.86 billon or 208.83 per cent. As at 28 February 2021, total transactions at the nation’s bourse decreased by 7.26 per cent from N232.46 billion (about $590.82 million) in January 2021 5 to N215.58 billion (about $525.21 million) in February 2021.
The performance of the current month, when compared with the performance in February 2020 (N148.50 billion), revealed that total transactions increased by 45.17 per cent. In February 2021, the total value of transactions executed by domestic investors outperformed transactions executed by Foreign Investors by circa 42 per cent.
A further analysis of the total transactions executed between the current and prior month (January 2021) revealed that total domestic transactions decreased by 16.99 per cent from N184.94 billion in January to N153.51billion in February 2021. However, total foreign transactions increased by 30.62 per cent from N47.52 billion (about $120.78 million) to N62.07 billion (about $151.23 million) between January 2021 and February 2021. A further analysis showed that institutional investors outperformed retail investors by 30 per cent.
A comparison of domestic transactions in the current and prior month (January 2021) revealed that retail transactions decreased by 20.23 per cent from N67.44 billion in January 2021 to N53.80 billion in February 2021. The institutional composition of the domestic market also decreased by 15.14 per cent from N117.50 billion in January 2021 to N99.71 billion in February 2021. Highlights the performance of the market over the last decade revealed that over a 14 year period, domestic transactions decreased by 59.54 per cent from N3.556 trillion in 2007 to N1.439 trillion in 2020 whilst foreign transactions increased by 18.45 per cent from N616 billion to N729 billion over the same period. Total domestic transactions accounted for about 74 per cent of the total transactions carried out in 2020, whilst foreign transactions accounted for about 26 per cent of the total transactions in the same period.
The NSE boss, Mr. Oscar Onyema, said recently that the sustained trading that was activated at the early lockdown contributed to increased domestic investors, stressing that timely market information drove liquidity. Onyema disclosed that the nation’s capital market was currently dominated by 60 per cent domestic investors as against 40 per cent foreign investors. Speaking at a webinar titled: “Capital Markets in a Pandemic,” he noted that Nigerian economy in the last three months was facing dwindling crude oil prices and that coronavirus pandemic have led to foreign investors exit from the capital market.