The Zimbabwe Stock Exchange (ZSE) is now open for listing of new products such as Exchange Traded Funds following amendments to listing requirements.
An ETF contains an assortment of stocks; a basket tracking an index. These could be indexes made up of related stocks such as mining, agriculture, technology among others.
“The listing rules Amendment incorporates Exchange Traded Products (“ETP”) Listings Requirements, which means ZSE is now able to receive applications for listing of Exchange Traded Funds and Exchange Traded Notes.
“The ZSE is also now able to process applications for prospective market makers,” revealed ZSE chief executive Mr Justine Bgoni in a statement.
This comes as the bourse is working towards increasing products on offer, especially for local retail investors. The new development follows approvals from stakeholders, especially regulator — the Securities and Exchange Commission of Zimbabwe.
Mr Bgoni added: “The Zimbabwe Stock Exchange Limited (ZSE) wishes to advise stakeholders on the approval of the Securities and Exchange (Zimbabwe Stock Exchange Listings Requirements) Amendment) rules, 2019 and the Securities and Exchange (Zimbabwe Stock Exchange Market Making) rules 2019.
“The approval was sought and granted by the Securities and Exchange Commission of Zimbabwe (SECZ) in terms of section 65 (3) of the Securities and Exchange Act (Chapter 24:25).”
The initiative is in line with the local bourse’s vision of a “threefold mandate” to promote investments in the capital markets.
This entails getting fundamentals right through regulatory processes and supporting activities, improving relationships with stakeholders, and growing the exchange in terms of new products, listings, investors and expanding ZSE’s reach and influence.
The stock market has traditionally been deemed elitist with fewer products on offer. These initiatives will help demystify the capital markets and enhance participation by local investors.
In 2019, the bourse also held masterclasses for educational purposes which included IPO masterclass and IPP masterclass held in partnership with Ministry of Energy as part of efforts to lure companies in the energy sector to list on the bourse and help them raise capital for energy expansion projects.
Creating viable financing options to raise capital for independent power producers would help alleviate the crippling power shortages currently obtaining.