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SEC

Foreign portfolio investment hits N1.208trn

Chinenye Anuforo

Current statistics from the Nigerian Stock Exchange (NSE) has shown that Foreign Portfolio Investments (FPIs) last year hit N1.208 trillion, accounting for about 48 per cent of total transactions.

The data also showed that FPI, which was N1.539 trillion in 2014, however, shrank to N518 billion in 2016, but increased significantly by 133 per cent in 2017.

Further analysis of the data also showed that over an 11-year period, domestic transactions have decreased by 62.46 per cent from N3.556 trillion in 2007 to N1.335 trillion in 2017

However, there was a significant increase in 2017 by 111 per cent from N634 billion recorded in 2016.

The data showed that total transactions at the nation’s bourse significantly increased by 72.64 per cent from N278.49 billion recorded in November 2017 to N480.80 billion (about $1.57 billion) the next month.

The aggregate value of transactions from January to December 2017 increased significantly by 68.25 per cent from N1.511 trillion recorded in 2016  to N2.543 trillion in 2017.

Total FPI increased by 37.56 per cent from N150.10 billion recorded in November 2017 to N206.48 billion in December 2017.

Domestic Transactions significantly increased by 113.66 per cent  from N128.39 billion to N274.32 billion within the same period.

The FPI outflow includes sales transactions or liquidation of portfolio investments through the stock market, while the FPI inflow includes purchase transactions on the NSE (equities only).Total domestic transactions significantly increased by 434.63 per cent between January and December.

The institutional composition of the domestic market increased by 673.97 per cent, from N31.19 billion in January to N241.40 billion in December.

The retail composition also increased by 63.62 per cent from N20.12 billion to N32.92 billion within the same period.

This indicates a higher participation by institutional investors over their retail counterparts. Since 2011, FPIs have consistently outperformed domestic transactions.

However, domestic transactions marginally outperformed foreign transactions in 2016 and 2017, accounting for 52 per cent of the total transaction value in 2017.

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