The Ghana Stock Exchange (GSE) is enhancing its engagements with institutional investors and high-net-worth individuals, its Managing Director Abena Amoa has told the B&FT.
The Accra bourse will also focus on educating entrepreneurs about various asset classes, including gold, through the Exchange-Traded Funds (ETFs).
Ms. Amoah explained that the move will play a crucial role in shaping stock market dynamics, noting that strengthening these relationships will facilitate increased participation and investment in the exchange – leading to a more robust and diversified marketplace.
To achieve this, the GSE has initiated a series of non-deal roadshows intended to take the market directly to entrepreneurs, she added.
“We are stepping up our engagements with institutional investors and high-net-worth individuals. Along that line, we have started a series of non-deal roadshows; we are taking the market to entrepreneurs now – particularly for them to understand other asset classes, gold as an asset class, through ETFs among others. So, these are a number of things we are doing to prepare the market for a take-off in the medium-term,” she said.
This comes as the market has witnessed a renewal of interest following a slowdown, which began toward the end of 2021 and gathered pace in the middle of 2022. However, since end of the final week of February this year, the Exchange’s Composite Index (GSE-CI) – which tracks the broad market performance – has followed a generally upward trend, appreciating by 27 percent from 2342.26 points to 2970.68 points in the middle of July’s second trading week.
This propelled the market capitalisation to a hair’s-breadth under GH¢72billion – its highest ever!
In June, Benso Oil, Total, Unilever and MTN were the best performers. Despite a recent slowdown, the sole ETF began to witness an uptick. Launched in 2012, the NewGold ETF (GLD) – which tracks gold prices – has seen its share price appreciate by 57.4 percent over last year, as investors remain concerned over the safety of their investments.
During the period – April 12 to July 12, 2023, the ETF was the eighth most actively traded stock on the Ghana Stock Exchange. With a total volume of 337,620 shares valued at GH¢66.1million, the ETF has demonstrated consistent trading activity. On average, approximately 5,359 shares were traded per session. The highest volume recorded during this period was on May 17, reaching 306,976 shares, data show.
At the close of December 2022, the combined assets under management (AUM) of ETFs in US and Europe were estimated to have reached US$6.7trillion – a compound annual growth rate (CAGR) of around 15 percent since 2010. The growth rate is nearly three times higher than that of conventional mutual funds in these regions.