The market segmentation of The Nigerian Stock Exchange will "go live" on Tuesday, November 1, 2011. On this date, The NSE systems and market reports will reflect key changes to the Markets, Boards and Industry sectors.The Exchange will also unveil new parameters for segmenting equities by market capitalisation, and into growth or income stocks.
According to N. Yvonne Emordi, Head of Strategy at the NSE, “This is a strategic step to align our market with Nigeria’s economic sectors, and with other industry classification standards, such as GICS, SIC and NAICS, which global portfolio managers are familiar with. We are now better positioned to drive proper allocation of assets to Nigeria”.
Highlights of this thorough exercise include:
Ø A move from three to 2 Markets and rebranded Boards in both markets;
Ø The pruning of the previous 33 sectors down to 12 Sectors, and reclassification of all listed companies within the new sectors; as well as
Ø A standard for defining Large, Mid or Small Cap stocks, and Growth or Income stocks.
The new market segmentation configuration is also designed to create simplicity for investors. It informs the construction of individual investment portfolios, in terms of asset allocation, providing investors the basic tools for understanding risk diversification.
Oscar Onyema, CEO of the NSE, confirmed that, “This is one of the nine projects we are launching this year to substantiate our undertaking to become ‘The Gateway to African Markets’”.