Kenya to introduce derivatives.

By IVCPOST Staff Reporter

Jul 11, 2013 03:28 AM EDT

Following Kenya's equity trading volume decline in its stock exchange, which is also the region's largest, Kenya announced plans to introduce real estate investment trusts and derivatives, Kenya's financial-markets regulator said.

The Capital Markets Authority in Kenya will most likely approve the introduction of the futures products before the year ends, the agency's acting chief executive officer, Paul Muthaura said. Exchange-traded funds, though, may start only by next year, Muthaura said. The futures products will focus on interest-rate, foreign-exchange derivatives, and asset-backed securities. Its introduction will provide investment banks and funds more acces to Kenya's growing market.
 
"The new range of products will deepen the market. Providing new investment opportunities will attract more foreign investors looking for a variety of investment options and allow local investors to spread their investment and tap into new sources of raising capital for projects," Muthaura said in an interview in Nairobi with the media.

This year, Kenya's index, The FTSE NSE Kenya 25, has already increased by 23%. That puts the nation's main stocks index third as the best performing index in Africa only after Ghana and Nigeria.

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