MUTUAL FUNDS TO HIT N1.5TN THIS YEAR – SEC
The Securities and Exchange Commission has said that Collective Investment Scheme in the nation’s capital market may hit over N1.5tn before the end of this year. The CIS, also known as mutual funds, is an arranged pool of funds managed on behalf of investors by a professional money manager which may invest in ventures capital, portfolio of stocks, bonds and other securities.
The acting Director-General, SEC, Ms. Mary Uduk, who stated this on Friday at a forum in Lagos, said the commission was setting up more strategies to develop the mutual fund segment in the capital market, according to a statement. Uduk, who was represented by the Head, Office of Economics at SEC, Mr Okey Umeano, said the segment had grown over the years.
She said, “In any advanced market, the Collective Investment Scheme forms a very big part of the market. We, at the Commission, have discovered that some of the investors who lost their savings during the crisis in 2008 are low on confidence.
“That is the reason why we are encouraging retail investors to go through these mutual funds because they are set up and approved by capital market operators and SEC, which regulates them (operators). Uduk added, “Currently, the size of the segment stands at N1tn but we expect it to grow much higher. So, we are urging retail investors and high net worth investors to use the mutual funds route to enter the market.”
The Divisional Head, Economic, Research and Policy Management, SEC, Dr Afolabi Olowookere, said about 480,000 investors had keyed into the investment segment. He said, “We still expect that size to get to N1.5tn or N2tn and the reason is because it provides an avenue for retail investors to buy. “The mutual fund may not have very high return but definitely, it won’t have low return and with SEC at the forefront of financial inclusion, we are pushing collective investment scheme because it brings some form of stability for investments.”