Nigerian Exchange Traded Funds (ETFs) closed 2022 on a positive note with an average return on investment of 5.4%.
This was according to data compiled by the Nigerian Securities and Exchange Commission (SEC).
Analysing the data, the twelve listed ETFs increased their aggregate market capitalization from N6.99 billion as of 31st December 2021 to N7.22 billion by the end of 2022, indicating a 3.1% year-on-year increase.
NewsBeatng checks revealed that eight of the twelve listed ETFs recorded positive returns, while four printed losses. However, only two of the funds recorded real positive returns, that is surpassed the annual inflation rate of 18.53%.
Exchange Traded Funds are tradable investment products (like stocks) whose returns track the performance of an underlying index.
An ETF holds assets such as Equities, Bonds, Currencies, Commodities Real Estate, etc and its return should closely align with the returns of the underlying index, save for trading costs, etc.
ETFs give investors an efficient way to diversify their portfolios, without having to select individual stocks or bonds. They cover most major asset classes and sectors, offering investors a broad selection.