More units for ETF


Old Mutual ZSE Top 10 Exchange Traded Funds (ETF) listed additional 9m units on increased interest from retail investors, the Zimbabwe Stock Exchange has said.

The ETF now has 141m units from the 80m when it listed in January, ZSE chief executive officer Justin Bgoni said.

The value has gone by more than 200% to ZWL$280m from ZWL$80m.

“We still believe there is more room for additional products including more ETFs and new REITs [Real Estate Investment Trusts].

We continue in our quest to make our market a viable option for your investment,” Bgoni said.

The introduction of ETFs has improved liquidity and diversification of offerings at the local bourse which had been composed of local equities only.

Zimbabwe has joined other four bourses in Africa -South Africa, Nigeria, Kenya and Egypt- to trade the instrument.

Old Mutual put the initial seed capital in the form of scrip in the exact weights of the top 10 index.

The ETFs track the ZSE Top 10 counters, which are defined from time to time by the ZSE, which reviews the counters once a quarter.

The ZSE, Top 10 counters at the end of April were Innscor Africa, Delta, Econet Wireless, Ok Zimbabwe, Meikles, Cassava, National Foods, Padenga, Simbisa and Zimre Holdings Limited.

This means the investors are offered the opportunity to own the 10 underlying stocks through one investment in the ETFs.

Investors who wish to invest in the fund can do so through two ways, by buying units in the ETFs through any registered stockbroker or alternatively investing in kind by delivering a basket of stocks in the exact weights of the fund through an authorised participant.

The fund manager, Old Mutual Investment Group Zimbabwe, is responsible for periodically replicating the ZSE Top 10 index in line with the index ground rules.

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