Omega Ukama 
THE Securities and Exchange Commission of Zimbabwe (SecZim) says a number of derivatives are in the pipeline for the local capital market, following the introduction of the country’s fourth exchange traded fund (ETF) last week.
A derivative is a financial instrument that derives its value from another asset. These instruments have headlined global financial innovation over the past three decades, but Zimbabwe has lagged behind.
Last Thursday, Morgan & Co, an investment bank, launched an ETF — a derivative that offers the benefits of a diversified portfolio of investments, but with less complications.
This was the country’s third ETF this year, and the country’s fifth derivative to trade on a mainstream exchange.
“There are more products and innovations coming through from the capital markets, there are more ETFs coming and there are more REITs (real estate investment trusts) coming. And they are young people in Zimbabwe who have so many innovations that they are bringing to us. So, as SecZim, we say, watch this space because there are more exciting developments in the pipeline,” SecZim’s acting chief executive, Gerald Dzangare, said at the launch ceremony.
“We have a lot of catching up to do and we’re so grateful to organisations like Morgan & Co who are getting us up to speed.
“There is a paradigm shift in Zimbabwe’s capital markets. There is a generation that is coming up with new products, that is coming up with new innovations and as SecZim, we will continue to be a catalyst for this development and the modernisation of our capital markets,” he said.
Zimbabwe Stock Exchange board chairperson Caroline Sandura, who was also at the launch ceremony, said: “As the ZSE, we are pleased that as a market, we have managed to grow the ETF space using our own resources and skills in such a short space of time.”
“By the end of this month, we are actually anticipating the listing of another exciting product, also homegrown.
“This shows that as a market, we have come a long way and we should applaud ourselves. There’s really nothing that should hinder us from doing even more complex structured products.”
This also comes as local alternative trading platform Financial Securities Exchange is rolling out an automated derivatives writing and trading solution, as it pushes to bring the country’s capital market up to speed with the rest of the world.
newsdesk@fingaz.co.zw
