Nigeria's Challenging Macroeconomic Environment Adversely Affecting Retail Investors


Tuesday, July 06, 2021 / 10:00 AM / Ottoabasi Abasiekong for WebTV / Header Image Credit: WebTV

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The challenging macroeconomic environment in Nigeria is adversely affecting Retail Investors' activities in the equities market.


Mr. Charles Fakrogha the Chief Operating Officer, Supra Commercial Trust Limited, made the point in a discussion on the May 2021 domestic and foreign equity trading.


According to him, the macroeconomic issues of high unemployment, high inflation, insecurity, and the rising tide of poverty constituted part of the reasons why retail transactions witnessed a decline in May 2021.


He said even quoted companies seeking to raise funds to expand their operations are concerned about the security situation in the country.


Speaking further he believed the capital market operators (CMOs) have their work cut out for them in encouraging retail investors to participate in the equities market, despite the prevailing socio-economic conditions in the country.


He acknowledged the fact that several companies are doing their best to give reasonable investment returns to shareholders despite the challenging economic indicators.


Fakrogha noted that institutional investors outperformed retail investors in the recent equities trading report, the report showed that the institutional investors were able to rebalance their portfolios and manage risks effectively.


The market analyst urged CMOs to increase their enlightenment programmes to sensitize retail investors on the value and opportunities in the market.


He called on market operators to give priority to innovative ways that could attract millennials to participate in equity activities, thereby improving financial inclusion.


Looking at developments in the market he stressed the need for millennial-friendly products because they are already investing in foreign markets and cryptocurrency.


On the outlook for the second half of the year 2021, he advised investors to monitor their portfolio while he believed that an improved economic situation will lead to improved market performance.

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