Stock market not for the rich only—MSE

The Malawi Stock Exchange (MSE) has encouraged Malawians from all walks of life to participate in the local bourse and ultimately benefit themselves and the economy at large.

Speaking ahead of the National Financial Literacy Week on Thursday in Blantyre while briefing journalists, MSE chief operations officer John Kamanga said the MSE and other capital markets mobilise funds and hence are important to the development of the economy.

Regardless of the importance of the local bourse, Kamanga noted that only a few Malawians invest in shares attributing the trend to lack of knowledge.

He, however, noted that the MSE has established linkages with training institutions, including the University of Malawi through which they have availed their services.

“We have also established linkages with the industry, including the Malawi Confederation of Commerce and Industry [MCCCI] during their annual general meetings to encourage companies to list or sell shares on the stock market,” said Kamanga.

He hoped that through initiatives such as the financial literacy week and support from the Reserve Bank of Malawi (RBM) and the World Bank they will be able to expand their outreach to the general public and net in the rural masses.

Kamanga, however, noted that the recent depreciation of the kwacha has affected the stock market arguing that although investors might have realised some gains in kwacha terms in real gain is as been reduced reduced.

He said that the MSE is looking at going beyond stocks to start trading in municipal bonds which will include statutory corporations’ especially utility companies to raise capital for infrastructure development.

Also speaking during the briefing, Armstrong Kamphoni, African Alliance Securities chief executive officer, noted that stocks are a viable investment in the long term.

He said that anybody can invest in shares on the MSE which requires a minimum of 100 shares can be done by anybody.

Kamphoni who also chairs the Stockbrockers Association of Malawi, said that investing in stocks can benefit the holder through capital gains and dividends.

On why Malawi does not have long-term government securities, Nico Asset Managers chief investment officer Emmanuel Chokani said although there is need for long-term government securities, it would be difficult to invest in such.

He argued that Malawi’s economy is unpredictable in terms of cost of finance and pointed out that the country must first deal with the general economy.

Another panellist, Old Mutual Investment Group general manager Mark Mikwamba, encouraged investors on the local bourse to seek professional advice and not invest based on hearsay.