Domestic and Foreign Portfolio Participation in Equity Trading - March 2020

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Monday, May 04, 2020 / 11:12 AM / 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 31 March 2020, total transactions at the nation's bourse increased by 63.58% from N148.50billion (about $484.60million) in February 2020 to N242.91billion (about $630.04million) in March 2020. The performance of the current month when compared to the performance in March 2019 (N110.11billion) revealed that total transactions increased by 120.60%. In March 2020, the total value of transactions executed by Domestic Investors outperformed transactions executed by Foreign Investors by circa 10% as shown in figure 1 below

 

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A further analysis of the total transactions executed between the current and prior month (February 2020) revealed that total domestic transactions increased by 71.97% from N77.16 billion in February to N132.69 billion in March 2020. Also, total foreign transactions increased by 54.50% from N71.34 billion (about $232.79million) to N110.22 billion (about $285.89million) between February and March 2020.


Analysis Of Domestic Transactions

The value of domestic transactions executed by Institutional Investors outperformed Retail Investors by 10% as illustrated in figure 4 below. A comparison of domestic transactions in the current and prior month (February 2020) revealed that retail transactions increased significantly by 103.72% from N29.56 billion in February 2020 to N60.22 billion in March 2020. Similarly, the institutional composition of the domestic market increased by 52.23% from N47.60 billion in February 2020 to N72.46 billion in March 2020.

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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 thirteen (13) year period, domestic transactions decreased by 72.30% from N3.556t in 2007 to N985bn in 2019 whilst foreign transactions increased by 53.08% from N616bn to N943bn over the same period.

Total domestic transactions accounted for about 51% of the total transactions carried out in 2019, whilst foreign transactions accounted for about 49% of the total transactions in the same period.

The actual performance referenced 2020A (2020 Actual) shows that total foreign transactions carried out year till date (YTD) is about N251.87 billion whilst total domestic transactions YTD is about N374.98 billion.

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