A historic agreement to bring institutional investment to Nigeria’s capital markets was announced. SecondSTAX, an innovative technology startup, and Nigerian Exchange Limited (NGX) announced a relationship to enable direct investment from African institutional investors into Nigeria’s vibrant capital markets using a complex yet user-friendly digital platform.
This project also involves Afrinvest (West Africa) Limited, a Nigerian capital market powerhouse competent in investment banking, securities trading, and asset management.
Read also: SecondSTAX Partners with Ghana Stock Exchange, Nairobi Securities Exchange
Bridging African Investment Gaps
Nigeria has the biggest economy in Africa, so its capital markets have long been good places to invest. In 2020, Lagos’s stock market went up 50%, making it the best in the world and the best of Bloomberg’s 93 stock indices. Several companies on the stock market saw gains of 400%.
Because African exchanges were segregated, these business opportunities were only open to Nigerians. SecondSTAX’s technology links Africa’s debt and equity capital markets and makes it easier for institutions and capital to spend.
A Tech-Driven Approach to Investment
SecondSTAX’s transparent, cloud-based interface simplifies Nigerian investments for institutional investors like licensed broker-dealers, asset managers, and large commercial banks. It also allows investing in native currencies, increasing asset accessibility and African wealth development.
Eugene Tawiah, CEO and co-founder of SecondSTAX says, “We want to connect all of Africa’s capital markets so that investment flows more smoothly.” He says the relationship with NGX is significant for them to find profitable opportunities in Nigeria’s capital markets, which are usually out of reach for institutional investors outside Nigeria.
Creating more investment opportunities
SecondSTAX already works well with the Nairobi Securities Exchange (NSE) and the Ghana Stock Exchange (GSE). They not only bring money to these exchanges, but they also make sure that Nigerian institutional investors can diversify their portfolios by investing in other capital markets on their platform.
After the launch, the services will first be available to Qualified Institutional Investors who place a trade order worth at least USD 10,000.00. This limit will eventually be lowered, allowing more customers to use the services.
Temi Popoola, CEO of NGX, praises SecondSTAX for their innovative approach to attracting institutional investments across Africa. This method aligns with NGX’s efforts to promote growth and innovation in the market through several different programs.
Ike Chioke, Group Managing Director of Afrinvest, is also excited about the partnership. He says it could make it easier to spend and bring more money into Nigeria’s capital markets.