Domestic and Foreign Portfolio Participation in Equity Trading - February 2021

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Tuesday, March 23, 2021 / 01:30 PM / By NSE / Header Image Credit: NSE

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On a monthly basis, The Nigerian Stock Exchange polls trading figures from market operators on their Domestic and Foreign Portfolio Investment (FPI)4 flows. As at 28 February 2021, total transactions at the nation's bourse decreased by 7.26% from N232.46 billion (about $590.82million) in January 2021 5 to N215.58billion (about $525.21million) in February 20216. The performance of the current month when compared to the performance in February 2020 (N148.50billion) revealed that total transactions increased by 45.17%. In February 2021, the total value of transactions executed by Domestic Investors outperformed transactions executed by Foreign Investors by circa 42% as shown in figure 1 below.

 

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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% from N184.94billion in January to N153.51billion in February 2021. However, total foreign transactions increased by 30.62% from N47.52billion (about $120.78million) to N62.07billion (about $151.23million) between January 2021 and February 2021.

 

Analysis of Domestic Transactions

Figure 4 below shows that Institutional Investors outperformed Retail Investors by 30%. A comparison of domestic transactions in the current and prior month (January 2021) revealed that retail transactions decreased by 20.23% from N67.44billion in January 2021 to N53.80billion in February 2021. The institutional composition of the domestic market also decreased by 15.14% from N117.50billion in January 2021 to N99.71billion in February 2021.

 

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Historical Analysis Of Domestic And Foreign Transactions

The data in figure 7 below highlights the performance of the market over the last decade. Over a fourteen (14) year period, domestic transactions decreased by 59.54% from N3.556t in 2007 to N1.439t in 2020 whilst foreign transactions increased by 18.45% from N616bn to N729bn over the same period.

 

Total domestic transactions accounted for about 74% of the total transactions carried out in 2020, whilst foreign transactions accounted for about 26% of the total transactions in the same period.

 

 The transaction data for 2021 shows that total foreign transactions was circa N109.59billion, whilst total domestic transactions was circa N338.45billion.


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