Investor Protection Efforts by the NSE Presented By Tinuade Awe Head, Legal and Regulation Division

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2 Investor Protection Efforts by the NSE Presented By Tinuade Awe Head, Legal and Regulation Division To the Investors Clinic for Registered Shareholders Associations MARCH 19, 2014

3 Contents Introduction Key players of the market NSE s Vision NSE s obligations to investors NSE s Initiatives for Investor Protection Investors Protection Fund Conclusion

4 Key Players in the Market Broker-Dealers Bring issuers to the market; execute buy/sell orders Enabling Framework: SEC registration plus NSE license; CIS Act of 1992; ISA 2007, SEC Rules (2013), NSE Rules SEC (Apex Regulator) Maintains primary oversight of the capital market Enabling Framework: ISA 2007 and SEC Rules (2013) NSE (SRO) Enabling Framework: SEC registration as an Exchange; ISA 2007 and SEC Rules (Nov 2012); NSE MEMART; NSE Rules Registrars Maintain registers of company shareholders Enabling Framework: SEC registration as a Registrar; ISA 2007 and SEC Rules (2013) CSCS Sole provider of clearing and settlement services Enabling Framework: SEC registration as a CSD; ISA 2007 and SEC Rules (2013) Trustees Maintain assets on behalf of investors Enabling Framework: SEC registration as a Trustee; ISA 2007; Trustee Investment Act 1962; SEC Rules (2013) Investors/Participants Originate orders Others Issuing houses, OTC platforms, fund managers etc. Enabling Framework: SEC Registration; ISA 2007 and SEC Rules (2013) Custodians Maintain assets on behalf of investors Enabling Framework: SEC registration as a Custodian; ISA 2007 and SEC Rules (2013)

5 Investors

6 NSE s Vision To be the leading Stock Exchange in the African region for capital formation, driven by transparency, innovation efficiency and liquidity. Strong Regulation and Supporting Regulatory Programs Growth enabling market structure 21 st Century Technolog y Strategies Targeted Listing and product efforts First rate Investor Protection strategies 5 year Target $1tr Market Cap

7 NSE s Obligation to Investors Transparency and integrity Information equity Rules and regulations Enforcement

8 NSE Initiatives for Investor Protection Market Facing Rules and Regulations Local and Foreign Collaboration Compliance Investor Protection Fund Rule benchmarking and review Collaboration with law enforcement Constant Disclosure Transformation of Market Operators Rules governing transactions on related parties IOSCO, US SEC Inspection and Complaints Management X-Alert Rules and Regulation Governing Dealing Members FSRCC Technology X-Whistle Rules relating to Board and General Meetings of Issuers ISG Market Surveillance

9 Investors Protection Fund (IPF)

10 X-Alert Joint NSE/CSCS initiative Provides investors with details of transactions on their accounts via SMS Easy monitoring of accounts Serves as an effective fraud alert in cases of unauthorized transactions on accounts Reduction in time spent confirming trades Enhancement of transparency between trader and clients Improves confidence in the capital market Notification of corporate information( Dividends, Bonuses, Payment Date, etc.) to clients via SMS

11 Transformation of Market Operators Manpower and equipment Organizational structure and governance Effective processes Global competitiveness Technology

12 Technology Technology X-Issuer Timely release of financial information to the market Greater transparency in information dissemination Greater market integrity with significant reduction of leakage of material information X-Monitor Electronically updates all material information and can be called up when needed X-Gen High performance, robust, multi-asset, multi-market matching trading engine Encourages wider participation of middle class and investing segment Enables investors to executive market orders on a wider range of devices including smart phones

13 Market Surveillance Daily monitoring of trading activities in the market Creation and analysis of alerts for unusual trading behaviour Preparation of surveillance reports on daily, weekly, monthly and quarterly basis Conduct detailed research and generate evidence of market abuse. Conduct investigations on suspected market abuse Prosecute and seek sanctions in appropriate circumstances

14 X-Whistle Whistle blowing portal for tips and referrals Anonymous and non-anonymous sources On-going engagement with source NSE review and determination

15 Conclusion

16 Question and Answers

17 Thank You Stock Exchange House 2-4 Customs Street P.O. Box 2457, Marina Lagos Island, Lagos, Nigeria

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19 BASIC INVESTMENT PRINCIPLES M A R C H Presentation at the Nigerian Stock Exchange Investors Clinic for Registered Shareholders Associations INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING

20 Outline Understanding YOURSELF as an investor Peculiarities of Financial Products The Investment Process Why you need an Investment Advisor? UBA Capital Group The One-Stop Shop for your Financial Need Products and Services Investnow.com.ng INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 20

21 Understanding YOURSELF as an investor - The Age Factor A Starter 20 s 30s-40 s 40s-50 s 60 s+ Strong appetite and natural headroom for high risk Alternative income sources Less need for liquidity from investment Wealth accumulation stage Split savings into long- and shortterm goals Think equities for long-term; liquid assets for short-term Growth is the target Consolidation stage Preparing for retirement Less appetite for risk, strong appetite for physical assets like real estate Increasing preference for income A fulfilled retirement Very low risk appetite Less energy Focus on stable income Fixed income products and realty are often the attraction The age factor in investing it helps to define who you are The young generation can accommodate more risk The middle age category has a balanced risk appetite Old investors should be discouraged from taking excess risk INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING Even within asset classes, consider age in selecting specific asset 21

22 Understanding YOURSELF as an investor - Investing The Four Cardinal Principles of Investing Set clear Investment Objectives - This should include time horizon - Consider your liquidity needs - Risk tolerance and other constraints - Tax considerations etc Minimize transaction cost - Only buy and sell when necessary - Ensure best execution - Mutual Funds/ETFs minimize cost Determine your Asset Allocation - The principle of diversification is crucial - Balance your risk with return expectation - Within each asset, also diversify Be Disciplined - Focus on your objective - Ignore short term noises - Rebalance portfolios - Restructure when necessary - Do not be part of the herd - Reset objectives if need be INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 22

23 Peculiarities of Financial Products - Asset Classes Money Market Reliable source of income Flexible choice amongst quality, maturity dates, returns Liquidity Low risk investments Bonds Real Estate Diversification from purely financial instruments A good hedge against inflation Components of both long term capital appreciation and current return in form of rental income Moderate risk investment Steady income from coupon payments Income also earned from capital appreciation Traded OTC Low risk investments Equities On a steady recovery path in 2012 Historically, has outperformed all other investment vehicles in the long run Good hedge against inflation Moderate risk Private Equity Additional diversification opportunity to portfolio Commodities offer best hedge against inflation Private equity provide market-independent (absolute) returns on investment Lock-in periods (investment horizon) for private equity could be high High risk investmenrts INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 23

24 Peculiarities of Financial Products - Risk Let s think about the risk of financial products 100.0% Private Equity What are the risk factors that may reduce return or cause loss of value? R i s k FGN Bonds State & Corporate Bonds Equity Real Estate Interest rate Exchange rate Economic growth Fiscal policies Credit risk Corporate governance 0.0% Cash (TBs, BAs,CPs,etc) Potential Return Which product does these risk factors affect? INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 24

25 Peculiarities of Financial Products - Liquidity Cash is king; when do you need back the cash? 100.0% Cash (TBs, BAs, CPs, etc) When you need back the cash determines the tenor of the product L i q u i d i t y FGN Bonds State Government Bonds Corporate Bonds Quoted Equities Real Estate/ Private Equity The earlier you need cash, the lower the return Consider how easy it is to transform a product back into cash Cash is king 0.0% Potential Return INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 25

26 Peculiarities of Financial Products - Return Comparison Return comparison: Equity Vs. Bonds Comparing Returns between equities and bond over a 20-year period: Equities rallied 17% CAGR Vs. Fixed Income Yield of 13.0% over same period 20.0% 18.0% 16.0% Does equities truly compensate investors for the risk of volatility % 12.0% Is the long term benefit of equities true in reality? 10.0 NSE Return trajectory Smoothed Return on Equity Smoothed Return on Bonds 10.0% 8.0% How long can the long term be? % INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 26

27 Peculiarities of Financial Products Return vs Risk The Risk and Return Pay-off; More Risk, More Return Source: UBA Capital Research, Vanguard Group INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 27

28 The Investment Process The Investment Process The Client Utility Functions Risk Tolerance/ Aversion Investment Horizon Tax Status Tax Code The Portfolio Manager s Job Views on markets Asset Allocation Asset Classes: Stocks Bonds Real Assets Countries: Domestic Non- Domestic Views on - inflation - rates - growth Risk and Return - Measuring risk - Effects of diversification Valuation based on - Cash flows - Comparables - Technicals Security Selection - Which stocks? Which bonds? Which real assets? Private Information Market Efficiency - Can you beat the market? Trading Costs - Commissions - Bid Ask Spread - Price Impact Execution - How often do you trade? - How large are your trades? - Do you use derivatives to manage or enhance risk? Trading Speed Trading Systems - How does trading affect prices? Market Timing Performance Evaluation 1. How much risk did the portfolio manager take? 2. What return did the portfolio manager make? 3. Did the portfolio manager underperform or outperform? Stock Selection Risk Models - The CAPM - The APM INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 28

29 Why you need an Investment Advisor? o o o o o o Expertise and in-depth knowledge of the financial market To determine optimal mix of investment to achieve set goals Access to a broad range of investment opportunities/products Timely and effective reaction to changes in the market Close monitor of investment portfolio Tracking of all returns, including dividends and bonuses INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 29

30 UBA Capital Group The One-Stop Shop for your Financial Needs UBA Capital Group, a major financial and investment services provider listed on the main board of the Nigerian Stock Exchange. It was spun-off from UBA Plc in 2012 following the directive of the Central Bank of Nigeria requiring all commercial banks to divest from non-core banking activities. The Group's business is conducted primarily in Nigeria with a Pan-African footprint and aspirations to expand to other major business capitals globally by leveraging on its broad reach and extensive market access to provide both domestic and cross-border services. As at 01 December 2013, the Group had 4 billion shares in issue, a market capitalisation of US$39.6 million, and total assets of over US$407 million. UBA Capital Plc is a leading financial and investment services institution and is made up of businesses that are leading players in their respective business segments. UBA Capital Plc is well positioned to play a strategic role in helping its clients achieve their strategic objectives through its robust suite of financial and investment service offerings UBA Capital Plc is poised to shape Africa s financial future UBA Capital Plc UBA Capital- Investment Banking UBA Trustees UBA Securities UBA Asset Management UBA MetLife UBA Nominee INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 30

31 UBA Capital Plc Products and Services UBA Capital Plc Service Offerings Investment Banking Trusteeship Asset Management Securities Debt Capital Markets Corporate Trusts Portfolio Management Securities Dealing (Fixed Income & Equity) Equity Capital Markets Bond Trusteeship Mutual Funds Equity Portfolio Management Mergers and Acquisition Private Trusts Wealth Management Receiving Agent to New Issues Project Finance Custodial Services Stock Broker to Primary Issues Structured Finance Collective Investment Trusts Designated Adviser to SMEs Real Estate Advisory Supplemental Market Making Research Though UBA Capital operates out of Lagos, Abuja and Port-Harcourt in Nigeria, we have unlimited access to our customers due to our ability to leverage on broad reach and borderless access to key financial centres. INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 31

32 UBA Capital Plc Asset Management Products and Services Fixed Income Investment Portfolio Management Investment Mutual Fund Investment Staff Investment Scheme Funds invested in Fixed Income Equities Fixed Income Principal Guaranteed Returns Guaranteed Equities Fixed Income Yes No Depends on plan chosen Yes No Depends on plan chosen Expected Return Medium High Depends on plan chosen Minimum Investment Amount Minimum Investment Period Fixed Income Yes Yes Medium N100,000 N20,000,000 N50,000 N20,000 1 month 12 months 1 month 3 months Risk Low Medium Medium Low INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 32

33 UBA Capital Plc Private Trusts Products and Services Products Will & Executorships Services Where a Trust is built into the Will and appointment is so made in the Will and we can also act as Executor and / or Trustee of your Will. In this respect, we undertake : Bury the deceased in the manner suitable to the Estate, determine the validity of the Will etc. Private Education Trust It is essentially a Trust set aside to secure the education of Beneficiaries Private Investment Trust Family Trusts & Family Office it is a Trust for long term saving and investment under Trust towards pre defined purposes such as future business, family holiday, real estate etc. it is a Trust to manage family estate as a single entity, structuring family offices. Nominee Services We hold shares for Private Clients in Nominee name and follow up with the collection of dividends and bonuses INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 33

34 UBA Capital Plc Securities Trading Products and Services UBAS High Prime UBAS Prime UBAS Thrive II UBAS Thrive (ONLINE) Target Investor Minimum Investment Amount High Net- worth Individual Silver - N 50 m Gold - N 100m Platinum N 150m or the equivalent in Stock value Middle- class Income Earner N5 million or the equivalent in Stock value Retail N50, or equivalent in Stock value Retail Commission Negotiable 1.35% 1.35% 1.35% Zero account opening balance Additional Service Special account set- up with CSCS A dedicated account officer A dedicated customer service desk Execution only INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 34

35 UBA Securities Limited - Our Value Proposition Listed on the Nigerian Stock Exchange Effective Risk Management and Group governance structures Transparency Accountability. INTEGRITY & RELIABILITY QUALITY SERVICE Block Fast Trades and and efficient Liquidity Fast execution and Efficient Execution Swift Swift and and Accurate accurate Feedback feedback Competitive Pricing Competitive pricing Block trades and liquidity We adopt an integrated approach that draws on the experience and competence of the firm, to deliver results above and beyond expectations and create value for our clients Indebt, World Class Research Market Reports and Updates Independent Corporate research Access Access Prompt to market Dedicated Research information Analysts and guidance Corporate Access Dedicated analysts RESEARCH Experienced PEOPLE & TECHNOLOGY Skilled Passionate Skilled and Professional Experienced Access Professionals to Networks Best-in-Class Technology On-line service platform INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 35

36 Introducing INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 36

37 InvestNow.com.ng - Features A self service, real time on-line platform, providing independent online access to Securities Trading, Asset Management, Trusteeship from anywhere in the world. FEATURES Online Account Opening with zero account balance Online/Real-time Account funding 24hr Online Client Portfolio Access / Account management Online / Real time customer support services Online access to transaction history and reports Online trading capabilities Access to real time market data Access to UBA Capital research Access to a product specialist INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 37

38 InvestNow.com.ng Account and Portfolio Management INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 38

39 InvestNow.com.ng Order Management INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 39

40 InvestNow.com.ng Contract notes and transaction history INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 40

41 InvestNow.com.ng - Research INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 41

42 Our Contact Ijeoma Michelle Daramola Head, Private Clients Office: Mob: ijeoma.daramola@ubacapitalgroup.com Abiola Rasaq Head, Research Office: Mob: abiola.rasaq@ubacapitalgroup.com Motunrayo Ade-Famoti Head, Private Trust Office: Mob: motunrayo.adefamoti@ubacapitalgroup.com Ahmed Maibe Client Manager Office: Mob: ahmed.maibe@ubacapitalgroup.com INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 42

43 Feedback Questions and Answers INVESTMENT BANKING ASSET MANAGEMENT TRUSTEESHIP SECURITIES TRADING 43

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45 Understanding the Capital Market Cycles & Trends NSE Retail Investor Clinic March 2014 Oluwole Abegunde MD, Meristem Securities Limited 45

46 Understanding The Concept of Cycles What are Cycles? Cycles are common phenomenon in all aspects of life. A cycle is an event, such as a price high or low, which repeats itself on a regular basis. It ranges from short to a very long term in e.g. the life cycle of a planet, which takes billions of years. Cycles exist in the economy, nature and the financial markets. The basic business cycle encompasses an economic downturn, bottom, economic upturn and top. Cycles in nature include the four seasons and solar activity (11 years). Cycles are also part of technical analysis of the financial markets. Cycle theory asserts that cyclical forces, both long and short, drive price movements in the financial markets Interestingly, no matter what market you are referring to, all have similar characteristics and go through the same phases. All markets are cyclical. They go up, peak, go down and then bottom. When one cycle is finished, the next begins. 46

47 Market Cycle- Definition A market cycle shows price movements over time from a period of rising prices and brilliant performance to a period of declining prices and poor performances and back again to rising prices. Stock market cycles are the long-term price patterns of the stock market. In a market cycle, we usually have periods of bull and bear markets. Bull Market Bear Market Prices trend upward driven by a host of factors e.g. fundamentals, positive sentiments, etc ( Prices trend downward driven by a host of factors e.g. fundamentals, negative sentiments, etc 0 Jan/06 Jan/07 Jan/08 Jan/09 Jan/10 47

48 Feb/08 Apr/08 Jun/08 Aug/08 Oct/08 Dec/08 Feb/09 Apr/09 Jun/09 Aug/09 Oct/09 Dec/09 Market Cycle- Signals Bull Market Securities highly undervalued Companies post impressive numbers Rising trend of volume of shares traded Investors have very high returns expectation/ speculative activities dominate A lot of primary debt and equity issues Bear Market Securities are highly overpriced Investors expectations are way above companies performances A lot of panic sales occur Volume traded gradually slows as investors exit positions Primary market activity minimal Source: Bloomberg 48

49 Relevance of Cycles to Profitable Stock Investing Most investors and traders either fail to recognize that markets are cyclical or forget to expect the end of the current market phase. Similarly, even when you accept the existence of cycles, it is nearly impossible to pick the top or bottom of one. But an understanding of stock market cycles is essential if you want to maximize investment or trading returns. Discerning investors can find good stocks in just about any market; however it is easier in some situations than others. In a full-blown bear market, when very few stocks are rising is a tough market for investors, yet, this presents some great opportunities when recovery begins. The most significant problem is identifying which phase is presently in control at any particular moment. The four phases are accumulation, markup, distribution, and markdown. 49

50 Market Cycle- Phases Market cycle is generally divided into 4 main phases: 1. Accumulation phase 2. Mark-up phase 3. Distribution phase 4. Mark-down phase Source: Investopedia.com 50

51 Market Cycle- Phases & Indicators Accumulation Occurs after the market has bottomed Market sentiment is bearish innovators and early adopters take the lead after figuring the market has bottomed Valuations are very attractive Sentiments begin to become positive Mark-Up Market is stable and begins to move higher Early majority joins the bandwagon As the phase progresses, more investors join the bandwagon fearing they will be left out Towards the end of phase, late majority comes in & greed relegates reason to the backseat Mark-Down This stage is most painful for those still holding positions Many hold onto stocks because prices have fallen below their entry price As the phase progresses and prices plunge further, they give up their holdings to minimize their loses. Early innovators start to re-enter at this point Distribution Sentiments become mixed Gradually sellers begin to dominate Investors become gripped with fear, interspersed with hope and even greed Transition can be hastened if accelerated by a strongly negative geopolitical or economic event 51

52 Market Cycle- Timing A cycle can last from a few weeks to a few years depending on the market in question and the time horizon being looked at. Examples of identified market cycles include the four-year presidential cycle on the American stock, real estate, bonds and commodities markets; annual seasonality, December/January effect etc Some times a cycle is completed faster than at other times depending on many factors. What can be identified is what phase of the market cycle the market is at any point using some Technical indicators such as the RSI. NSE Index Day RSI Source: Bloomberg per. Mov. Avg. (NSE Index) 90 per. Mov. Avg. (14-Day RSI)

53 Market Cycle- So what? Even though not always obvious, market cycles exist in all markets Investors who understand the different phases of the market cycle profit the most from markets They are also less likely to get fooled into buying at the worst possible time. Source: Macrotrends Investing based on fundamentals prevents one from adverse impacts of speculative buying and selling of stocks. 53

54 Identifying Trends in Stock Investing What is Trend? This refers to a general direction of a market or of the price of an asset and it varies in length from short, to intermediate, to long term. If you can identify a trend, it can be highly profitable, because you will be able to trade with the trend A trend can also apply to interest rates, yields, equities and any other market which is characterized by a long-term movement in price or volume 54

55 Identifying Trends in Stock Investing Identifying when a change in market trend is occurring is one of the most important skills to learn. However, there are several methods that can be used to identify a possible change in trend e.g. the emergence of a new pivot point. While identifying a pivot must always be done in hindsight, one can examine clues on a chart to determine whether the probability of forming a new pivot is high. One technique is to watch for a partial retrace after a trading range has been established. When a stock refuses to honor an established range, it usually reverses to break the trading range in the opposite direction, thus establishing a new pivot point. By picking a bottom, a trader can benefit by getting in early on a new trend. 55

56 Identifying a Partial Retrace There are three (3) basic trends for stocks: uptrend (moving higher), downtrend (moving lower) and consolidation (moving sideways). A stock in an uptrend is defined as making higher pivot highs, and higher pivot lows. downtrend uptrend source : Investopedia.com 56

57 Identifying a Partial Retrace A stock moving in a downtrend is defined as making lower pivot highs and lower pivot lows. A stock moving sideways is defined as moving in a trading range making pivot highs and lows approximately along the same horizontal area on a chart. Pivot points can be a little higher or lower, but generally speaking, the stock is trending sideways. It is important to note that a consolidation base can also slope upwards or downwards source : Investopedia.com 57

58 Identifying a Partial Retrace While a partial retrace can be defined as anytime a stock retraces only a portion of its prior move, this discussion will concentrate on stocks getting ready to move out of a consolidation base. Often, when a stock is consolidating, it is moving in a trading range, as supply and demand are in equilibrium. As a stock rises to the top of the range, sellers step in thinking the stock is getting expensive. As it drifts to the bottom of the trading range, buyers step in thinking the stock is becoming a bargain. This type of trend is necessary in order to weed out participants who are not committed to the position. The trading range will stay in place until either supply or demand triumphs. Typically, the trend prior to the consolidation is continued; however, there is always the possibility of a reversal source : Investopeia.com 58

59 Meristem Milestones Our milestone 1992: Year of establishment 2004: Meristem Registrar s was establishe d 2008: The setting up of Meristem Wealth Management Limited 2012: Meristem Trustees Limited was established 2003: Year of restructuring 2007: 7 th Position on the league table 2009: 2 nd position on the league table controlling 12% of market share 2013 till date: amongst top- 10 list of the NSE broker-dealer performance by activity level Meristem Securities Limited Meristem Stockbrokers Meristem Registrars Limited Meristem Wealth Management Ltd Meristem Trustees Limited Address: 124, Norman Williams Street Off Awolowo Road S/West Ikoyi, Lagos Phone: , info@meristemng.com 59

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61 THE ROLES OF SHAREHOLDERS' ASSOCIATION IN THE CAPITAL MARKET Abayomi Obabolujo Stockswatch Group March 19, Stars Investment Limited

62 SHAREHOLDERS ASSOCIATION Definition Relevance as a Group Roles In The Capital Market 200Stars Investment Limited

63 INTRODUCTION SHAREHOLDING - REDEFINITION Share/holder - an individual who buys shares and hardly sells. Note: buying to resell is trading and not shareholding. A fellow who is always in the market irrespective of sessions - up and down; bear, bull or sideway. An investor - in/vest- in/power Opportune individuals that the market exists to enrich. 200Stars Investment Limited

64 RELEVANCE AS A GROUP To create numbers, make the voices add up For united, progressive partnership For strength To enhance minority interest/holders protection Participation in Audit Committee membership Enhanced vote to determine Board composition Advisory roles - Regulators - Suggestions, Objective criticisms and support. 200Stars Investment Limited

65 RELEVANCE AS A GROUP Govt- capital market committee of the National Assembly Quoted companies- strategy, opportunities. Pressure group Mobile, proactive and forceful Firm on Company Board and Management to enforcing corporate governance At Annual General Meeting on Board composition et all 200Stars Investment Limited

66 ROLES IN THE CAPITAL MARKET Market s marketer-enhanced local participation- investors and companies Understanding of market developments and effective communication/education among members Public enlightenment- general investment education among members and the populace at large Understanding of market trends and effective communication to members. 200Stars Investment Limited

67 ROLES IN THE CAPITAL MARKET Ensure transparency and accountability by quoted companies Support smooth and uninterrupted running of the market High level optimism and onward transmission of same to members and the public Company information dissemination and joint action Understanding of market rules, politics and policies and effective communications to members and the populace Market stabilizer 200Stars Investment Limited

68 CONCLUSION The market exists as opportunity to make money works for shareholders in varied categories, it therefore behoves on all shareholders and association to ensure partnership with relevant authorities in bringing about vibrant market with higher local participation. Thank you. 200Stars Investment Limited

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