As demands for cost-effective, low-risk, diversified, and income-generating investment instruments continue to grow among investors­ owing to economic uncertainties, Exchange Traded Funds (ETFs) have become one of the viable investment options for investors. However, this aspect of the capital markets is less understood by the public, with questions like ‘What are ETFs, how can an investor benefit from this instrument and how can they be accessed?’ often asked.

In view of this, Parthian Securities Limited is set to host the investing public to a virtual Investment Clinic themed, “Exchange Traded Funds (ETFs): What they are and how to access them in Nigeria” on Thursday, March 31, 2022, at 2:30 pm WAT. The session will offer investors free insights and analysis on the Nigerian Equity Market with a focus on ETFs as Strategists at Parthian Securities Limited sit with one of the major players in the ETFs space in Nigeria, Vetiva Fund Managers Limited to give in-depth answers to these questions and more. 

In keeping with the promise to link our customers to their preferred investment opportunities, Parthian Securities Limited is set to organise the maiden edition of its “Bears & Bulls Series” themed “The Nigerian Equity Market: 2021 Review; 2022 Outlook & Stocks to Watch“. This online investment advisory clinic which will take place on the 27th of January 2022, at 2:30pm WAT, will offer investors free insights and analysis on the Nigerian Equity Market.

Bears & Bulls Series is an initiative of Parthian Securities, created to empower people looking to invest in the equities market this year and beyond with the vital knowledge and resources to help them ace their investment goals and make valuable gains.

Given the routine uncertainties that tend to dominate investors’ sentiments during a pre-election year, it is not uncommon for investors to be cautious and skeptical about allocating their assets in the country in this period. What does this mean to those investing in the Nigerian Equities Market, and where should such investors’ focus be in 2022? Analysts at Parthian Securities will give in-depth answers to these questions and more at the Bears & Bulls Series event.

According to Ahmed Olaitan Banu, Parthian Securities’ Chief Strategist, and one of the speakers at the event, “Bears & Bulls Series promises to be one of the most insightful sessions for anyone looking to make gains in the Nigerian equity market this year, and the best part is that we are giving out this valuable information to the public for free.” 

Click here to watch the recorded session.

Parthian Securities Limited (formerly PSL Capital Limited) is a Trading License Holder of the Nigerian Exchange and a member of the Parthian Group. Parthian Securities was incorporated in 2016 to provide individuals, financial and non-financial corporates access to securities on the NGX, NASD OTC, and FMDQ Securities Exchanges, with the main aim of ensuring that their various investment needs are adequately met. Parthian Securities Limited also offers investment advisory services, research on securities and companies, and other value-added service

Meet the Speakers:

 Ahmed Olaitan Banu is the Chief Strategist at Parthian Securities Limited. Ahmed has over 14 years of experience in the financial services sector, covering functions in Electronic Banking, Custodial Services, Institutional Trusteeship, and Investment Management & Advisory. He is a Charterholder of the Chartered Financial Analyst (CFA) Institute, an Associate Member of the Chartered Institute of Stockbrokers (CIS) and a Certified International Fixed Income and Derivatives (IFID) Dealer, with a master’s degree in Investment Management from the prestigious ICMA Centre from the University of Reading, UK.

Oluwaseun Dosunmu drives Investment Research activities at Parthian Securities Limited. Seun has extensive experience in Investment Research covering the Nigerian Macroeconomics and Financial market while providing periodic recommendations based on the changing dynamics to assist investors make optimal decisions. He is an expert in investment and data analysis in Financial Markets.

The Nigerian Equity Market (“the Market”) ended 2021 in the positive; the first sequential positive performance since 2013, with a Year-to-Date (“YTD”) return of 6.07% compared to the 2020 YTD return of 50.03%. The 2020 remarkable performance of the Market was significantly driven by the positive performance of Dangote Cement (DANGCEM), with a YTD return of 72.46% given it is the most capitalized stock in the Market, therefore, contributing a whole lot to the Market’s performance. However, in 2021, DANGCEM had a YTD return of 5% which we believe couldn’t have been a major contributor to the Market’s performance. So which stock(s) drove the Market’s performance in 2021? To understand the nuances, there is a need to clearly state that the top 5 most capitalized stocks in the Market (The Influencers) represent c.70% of the whole Market while the next 1o most capitalized stocks (The Significant Ones); in addition to the top 5, represent c. 90% of the whole Market. Hence, the individual performances of these top 15 most capitalized stocks have an impact on the performance of the Market.

Click here to access daily research updates from Parthian Securities Research Desk. 

Performances of the Top 15 Stocks in 2021 Based on YTD Return.

From the above, the top 3 performers in 2021 from the Top 15 most capitalized stocks were First Bank Nigeria Holdings (FBNH), Seplat Energy (SEPLAT) and Ecobank Transnational Int. (ETI). This evidences that the Market reacted positively to the increases in Crude Oil prices in 2021; the shareholdings shake-up that occurred in FBNH and the reemergence of ETI’s stronghold in Sub-Saharan Africa (SSA).

However, a further review revealed that the performance of the Market was really driven by the positive performances of MTN Nigeria (MTNN) and Airtel Africa (AIRTELAFRI) based on their sizes and YTD returns (members of the Influencers). Please see the table above. Whilst the performances of these stocks were driven by the market’s reaction to the announcement of the Central Bank of Nigeria’s (CBN) provisional approval of their PSB Licenses, AIRTELAFRI’s performance was in addition driven by the demand for the stock due to its dual listing. Big thanks to the Telcos, we must say.

Consequently, we expect a repeat in the performance of the Market if the PSB Licenses eventually gets approved by the CBN. However, would this happen in 2022? Only time will tell.