Domestic and Foreign Portfolio Participation in Equity Trading - April 2020

Wednesday, May 27, 2020 / 10:20 AM / By NSE / Header Image Credit: NSE

On a monthly basis, The Nigerian Stock Exchange polls trading figures from market operators on their Domestic and Foreign Portfolio Investment (FPI) flows. As at 30 April 2020, total transactions at the nation's bourse decreased by 47.03% from N242.91billion (about $630.04million) in March 20205 to N128.67billion (about $332.22million) in April 2020. The performance of the current month when compared to the performance in April 2019 (N148.91billion) revealed that total transactions decreased by 13.59%. In April 2020, the total value of transactions executed by Domestic Investors outperformed transactions executed by Foreign Investors by circa 18% as shown in figure 1 below.

A further analysis of the total transactions executed between the current and prior month (March 2020) revealed that total domestic transactions decreased by 43.11% from N132.69 billion in March to N75.49 billion in April 2020. Also, total foreign transactions decreased by 51.75% from N110.22 billion (about $285.89million) to N53.18 billion (about $137.31million) between March and April 2020.

Analysis Of Domestic Transactions

The value of domestic transactions executed by Retail Investors outperformed Institutional Investors by 8% as illustrated in figure 4 below. A comparison of domestic transactions in the current and prior month (March 2020) revealed that retail transactions decreased by 32.89% from N60.23 billion in March 2020 to N40.42 billion in April 2020. Similarly, the institutional composition of the domestic market decreased by 51.60% from N72.46 billion in March 2020 to N35.07 billion in April 2020.

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 N305.05 billion whilst total domestic transactions YTD is about N450.46 billion.

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