United Bank for Africa Plc has been selected as one of the few securities from 19 African stock exchanges included in the FTSE African Securities Exchanges Association’s Pan African Index.
The FTSE ASEA Pan African Index, which was created in December 2012, is a free float market capitaliwation weighted series constructed from securities domiciled on ASEA member Stock Exchanges. It, therefore, represents the performance of eligible securities listed on these exchanges.
A statement by UBA explained that this index series was designed after extensive market consultation to meet the needs of African investors and as the foundation of new tradable investment products.
The statement quoted an equity research analyst at UBA Capital Research, Mr. Abiola Rasaq, as saying that the selection of UBA stemmed from the liquidity and tradability of its stock as demonstrated over the years.
He said, “The purpose of the index is to measure the performance of eligible securities for African equity portfolios. The FTSE ASEA index is a welcome development as it provides a good benchmark for African Focused Fund, which currently uses the Morgan Stanley Composite Index Emerging/Frontier Market Index as proxy for benchmark return.
“Interestingly, the FTSE ASEA covers stocks on 19 of the 21 African bourses, thus can be seen to be truly representative of the African basket.”
He explained that the index was designed to ensure sufficient liquidity in their underlying stocks, to match the requirements of the users, adding that specific liquidity rules were applied in order to increase the tradability of the index by removing companies that are difficult to buy or sell.
Meanwhile, trading activities on the Nigerian Stock Exchange closed on a negative note on Wednesday, with the market capitalisation of the listed equities losing N29bn or 0.3 per cent to close at N10.626tn.
Prestige Assurance Company Plc led 40 other companies on the losers’ chart, shedding 10 per cent or eight kobo to close at 72 kobo per share.