More commodities exchanges will manifest this year —Okumagba

The relatively redundant posture of the commodities exchange in the country would come to a halt this year as more commodities exchange platforms are expected to spring up this year.

This was disclosed by the President of the Chartered Institute of Stockbrokers (CIS), Albert Okumagba, recently in Lagos.

He recalled that the same promise was made earlier in 2013 regarding Over The Counter (OTC) platforms which was successfully achieved with the establishment of NASD and FMDQ, which has been working optimally and recorded great success.

He said: “We hope to see more issues around the commodities exchanges. There are already two applications driven by the private sector. I think the connection between the Commodities Exchange, the agriculture and the solid minerals will manifest this year.”

“If we can celebrate the success of the OTC platforms, there is no reason why we’ll not celebrate two or three commodities platforms this year,” he continued.

A commodities exchange is an exchange, where regulated and standardized raw materials or primary commodities are traded (bought and sold).

Recall that the Nigeria Commodity Exchange has said it will inaugurate an electronic warehouse receipt system mid last year as part of efforts to boost activities in addition to encouraging visibility.

Speaking on investor protection, he advised retail investors to embrass Collective Investment Scheme (CIS) as a way to get better protection from the inherent risk.

CIS is a type of investment scheme that involves collecting money from different investors and then combining all the money collected to fund the investment.

He noted that a major challenge facing the capital market is that of its structure; adding that investors invest through CIS.

“If we have more retail investors participating in Collective Investment Schemes, there will also be better protection against risk,” he noted.

On his part, the General Secretary, Association of Stock Broking Houses Of Nigeria(ASHON), Mr. Akin Akeredolu-Ale disclosed that the coalition of capital market operators will be coming up with a list of quoted companies that are trading below book values.

This, he noted, would enable investors make informed decisions about the risk involved in the companies that they are investing in.

Source : Tribune

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