Nigerian Exchange Traded Funds (ETFs) closed the week on a positive note with an average return on investment (ROI) of 1.74% as VCG ETF, Meristem Growth, and Greenwich Alpha ETF led the gainers’ chart.
This is according to analysis by Nairalytics based on data from the Securities and Exchange Commission (SEC).
According to the data from SEC, six of the twelve listed ETFs recorded positive returns, only three of them printed negative returns while the remaining three funds closed flat. Similarly, the market capitalization gained N148.9 million to close at N7.74 billion.
The market capitalization increased from N7.59 billion recorded as of 29th April 2022 to N7.74 billion by the end of the week (6th May 2022), representing a 2% week-on-week increase.
The performance of the ETFs during the week is following the bullish run recorded in the Nigerian equities market as the All-Share Index rallied 2.61% in the week under review, while the NGX 30 index printed a 3.34% gain. Most remarkable is the 7.21% gain of the NGX Consumer Goods index in the review week.
Here is how they performed:
VCG ETF – 5.62%
- Vetiva Consumer Goods ETF printed a return of 5.62% during the week, as the offer price of a unit rose from N6.23 to N6.58 by the end of the week. On the other hand, the market capitalization declined by 6.97% to stand at N147.64 million.
- The VCG ETF is an open-ended Exchange Traded Fund managed by Vetiva Fund Managers Limited. It is designed to track the performance of the constituent companies of the NGX Consumer Goods Index and to replicate the price and yield performance of the Index.
- The NGX Consumer Goods Index comprises of the top 15 companies in the Food/Beverages and Tobacco sector listed on the Nigerian Stock Exchange (“NGX”) in terms of market capitalization and liquidity and is a price index weighted by adjusted market capitalization.
Meristem Growth ETF – 4.95%
- The Meristem Growth ETF recorded a 4.95% in the unit price, representing the second-best performing Exchange Traded Fund in the week under review. Its market capitalization also grew by 3.36% to close the week at N199.48 million.
- According to the company, the Meristem Growth ETF is designed to track growth stocks and is managed by Meristem Wealth Management Limited.
Greenwich ALPHA ETF – 3.88%
- Greenwich ALPHA ETF ranked as the third best performing ETF in the week under review with an ROI of 3.88%. The fund which is managed by Greenwich Asset Management Limited also saw it market capitalization grow by 3.88% to stand at N618.1 million.
- Greenwich Alpha is an open-ended ETF that tracks the NSE 30 Index, which is an index comprising 30 of the most liquid and capitalised stocks trading on the Exchange.
- According to the company, the fund is designed to enable investors to obtain market exposure to the securities of the constituent companies of the NSE 30 index and to reproduce the performance of the index.
Bubbling under
- Lotus Capital Halal ETF – 3.36%
- VG 30 ETF – 3.26%
- VI ETF – 3.23%
About Exchange Traded Funds
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 or Real Estate, etc and its return should closely align with the returns of the underlying index, save for trading costs, etc.
Good.
To what extent could an investor hope for a return of not less than 20% per annum on investments in Nigerian ETFs?