Kenya looks to boost liquidity with sec lending platform
24 September 2015 Nairobi
Image: Shutterstock
The Nairobi Securities Exchange (NSE) is launching several new products and tools, including a securities lending facility, to boost liquidity and tackle emerging market volatility.
The securities lending tool will feature as part of a securities settlement platform expected to go live in the next few months.
The platform will open the market to short selling and other investment strategies, which have proven to increase overall liquidity in established markets.
It will also facilitate same-day trading and settlement of government securities.
The NSE has not been immune to wider market conditions in the US and China and has suffered a 17 percent drop in investor confidence.
The Kenyan shilling has depreciated by around 16 percent year-to-date against the US dollar to now stand at less that $0.01 per shilling.
Currently, only 4 percent of the population at involved in the markets but the NSE and Capital Market Authority (CMA) have voiced a desire to entice more domestic retail investors through investing in long-term growth initiatives.
The securities lending tool will feature as part of a securities settlement platform expected to go live in the next few months.
The platform will open the market to short selling and other investment strategies, which have proven to increase overall liquidity in established markets.
It will also facilitate same-day trading and settlement of government securities.
The NSE has not been immune to wider market conditions in the US and China and has suffered a 17 percent drop in investor confidence.
The Kenyan shilling has depreciated by around 16 percent year-to-date against the US dollar to now stand at less that $0.01 per shilling.
Currently, only 4 percent of the population at involved in the markets but the NSE and Capital Market Authority (CMA) have voiced a desire to entice more domestic retail investors through investing in long-term growth initiatives.
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