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The Nigerian Online Trading Report

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Proshare

Thursday, August 04, 2016 5.12PM / Proshare Research

Executive Summary
A move by capital market operators (CMOs), one log in the making did not come via fiat (an age old approach to decisions in the capital market) but was driven by the changes in social relations that underpins the nexus between markets and people.


Nigerians moved beyond the pre-global crisis transaction model faster than regulators did and the new model, one that embraced the role and place of social media and online deployment was accelerated by the central bank’s move on a cashless economy and the growing activities of the telecommunications sector, the rise of e-commerce and the social acceptance of the convenience offered by online engagements meant that the retail market had found a new home.

The managers of the Nigerian Stock Exchange (NSE) recognized this trend and acted appropriately to capture same, evident in the launch of the X-Gen trading engine in Q3 2013.

At its commissioning in September 2013, the X-Gen was described as a veritable tool that will open up a wide range of opportunities while acting as a catalyst that will boost trading on the Exchange.

It proved just that; and allowed the market to recognize the possibilities, potential and opportunities available in harnessing the powers of technology, best practice models and consumer/customer needs to aggregate value. What the X-Gen did was unleash a new generation of services online defined by the rise of online trading platforms in the Nigerian Capital Market.

The first officially launched platform in Nigeria was the “Meritrade” powered by Meristem Securities Limited on March 5, 2014, followed by “LeadTrader” from Lead Securities & Investment Ltd on April 8, 2014.

Subsequently in the same year, other online platforms like “i-Trade” from MorganCapital Securities, “Bancorp e-Trade” from Capital Bancorp Plc, “InvestNow” from UBA Capital and “Afrinvestor” from Afrinvest Securities Ltd hit the Nigerian Capital Market Space for trading activities. 

Other online portal have since caught up to the trend and we currently have in the market platforms such as “Easytrade” from InvestmentOne; “Mytradebook” from Greenwich Trust Ltd; “WSTC eTrader” from WSTC Financial Services; “APTeTrade” from APT Securities Ltd; “GTIOn-line Trader” from GTI Securities; “TRW E-Trader” from TRW Stockbrokers; “Cordros TradeButton” from Cordros Capital and “ARM Stocktrade” from ARM Securities Limited.

It is the expectation of Proshare that in the next few months and year, online trading will be a common tool that will spurn a new drive for on-time, real-time investment information services that will build on the back of a realization that capital market activities is not restricted to quoted equities alone but includes OTC securities, bonds, ETFs, Options, Derivatives, and all other capital market activies a developing economy like Nigeria needs and deserves. We are so confident of this as discussions in and around the market shows and overwhelming acceptance of the need to talk about CMO’s as securities facilitators rather than stockbrokers.

For this and more, the move(s) to date deserves commendation from all involved in the market.

To provide a veritable and sustainable means of encouraging this positive growth, inspire innovation and provide a clear basis for accessing service providers, we have worked on a survey and research backed report which should provide a holistic ranking of these new initiatives and platforms for the investing public.

We seek not to grant awards but simply provide a basis upon which we can engage, encourage and enable continuous development of capital market tools and platforms to support the consumers role in the new Nigeria we expect to emerge.

This, the report we have presented here should at a minimum offer a first-hand feedback or health check on the brokerage industry and its foray into the use of technology to redefine its business and open a new path to the new market that inspired Proshare 10.0.

At the very minimum, it will serve as a guide to investor(s) in locating and making the best broker dealer choice when considering trading in the Nigerian Capital Market online.

The report includes a customer survey analysis of the service, technicality, accessibility and responsiveness of these platforms, as well as the fees and benefits of each broker. The report further details comments from customers as well as our independent observations and recommendations for broker’s consideration.

With technology listed as one of the five broad areas of minimum operating standards expected in the operations of all Broker Dealers in the Nigerian capital market, it is expected that more online trading portals will still be launched considering the number of brokerage houses currently operating in the market.

Click to Download Full Report

Do feel free to share your opinions/observations and feedback with us vide
market@proshareng.com. Thank you.
For: Proshare Editorial Board

Reshu BAGGA                                                     Grace ‘JARE-AJUWON

COO                                                                              Head, Business & Markets 

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