The Nairobi Securities Exchange (NSE)tech sophistication has gone a notch higher.
This follows the introduction of real-time Derivatives Market data on the Elektron Real-Time platform offered by Refinitiv. Elektron Real Time will provide investors level one real-time updates on the bourse’s single stock futures and index futures products.
NSE derivatives mart data goes live
The market data integration went live on Monday, 22nd February, 2021. NSE Derivatives Market (NEXT) is the NSE derivatives market that facilitates the trading of futures contracts in the Kenyan market.
NEXT is regulated by the Capital Markets Authority (CMA)
Elektron Real-Time is a data feed infrastructure built by Refinitiv, a leading global financial markets infrastructure and data provider.
This initiative makes Refinitiv the first international data vendor to onboard the NEXT data and extends the derivatives market’s regional and global reach.
Year to date (YTD) interest in NEXT has increased significantly, with market turnover registering KSh 24.9 Million worth of trades. This represents a gain of 183% over the same period during the year 2020. Year to date, the increase in trading activity has also led to a 106% increase in average daily turnover.
To enhance uptake, the bourse continues to engage with key stakeholders. Specifically, the NSE concentrates its efforts towards enhancing the knowledge and training of key market participants,.
It has been addressing the need to update Investment Policy Statements (IPS) that govern local institutional assets with administrators, trustees and fund managers; and onboarding of online trading members who have built a sizeable community of active retail investors.
“We are proud to collaborate with Refinitiv to meet the market’s demand for real time data of the NSE’s Derivatives Market. Partnering with a global data provider will not only attract foreign investors but also improve liquidity in the nascent market by enabling investors make faster and informed decisions,” said Geoffrey Odundo, Chief Executive at the NSE.
The NSE Derivatives Market enables you to trade in Equity Index Futures and Single Stock Futures.
NEXT Equity Index Futures are defined as derivative instruments that give investors exposure to price movements on any underlying index.
Market players can earn by trading based on price movements of a basket of equities. This is done without trading the individual constituents.
An index futures contract gives an investor the opportunity to sell or buy any underlying listed financial instrument priced at a fixed rate on a future date.
These products are cash-settled and easily accessible via NEXT members. The NSE has constructed Equity Index Futures contracts based on the NSE 25 Index.
NEXT Single Stock Futures can de be defined as derivative instruments that provide investors with exposure to price movements on any underlying stock. Dealers agree to exchange a specified number of stocks in a company for a price agreed today (the futures price). NEXT Single Stock Futures is cash-settled.