Prof. Uche Uwaleke, President of the Capital Market Academics of Nigeria (CMAN), has commended the Securities and Exchange Commission (SEC) over the inauguration of liquidity working group.
According to him, it is timely and strategic.
The group must prioritise retail investors’ onboarding through technology and deepening of the non-interest capital market.
The president said the working group should focus on measures that would broaden participation, stimulate secondary market activities and improve price discovery across a wider segment of securities.
He urged the working group to go beyond diagnostics and produce implementable, time-bound recommendations that addressed structural constraints to liquidity.
According to him, with market capitalisation rising from about N55 trillion in April 2024 to more than N120 trillion in 2026, the market is clearly enjoying strong bullish momentum.
However, as the SEC Director-General rightly noted, these impressive headline numbers mask structural weaknesses, especially in terms of liquidity depth and breadth of participation.
”Nigeria’s market, in spite recent gains, lags far behind South Africa in key metrics such as turnover ratio, depth of institutional participation, derivatives activity, and the vibrancy of retail investor participation.
”In South Africa, liquidity is more evenly distributed across listed securities, supported by strong pension fund participation and a sophisticated derivatives market.
”In contrast, our trading activity remains concentrated in a few blue-chip stocks, leaving many listed equities thinly traded,” he said.
Uwaleke said that if the mandates of the group were properly implemented, the initiative would mark a turning point in the structural transformation of the country’s capital market.
