The Lagos Commodity and Futures Exchange (LCFE), being promoted by the Lagos State Government, and the Association of Stockbroking Companies of Nigeria (ASHON), may commence operations soon, as the Securities and Exchange Commission (SEC), has granted the promoters approval-in principle.
The ASHON’s Chairman, Patrick Ezeagu, expressed gratitude to SEC for the opportunity, saying the Association is working very hard to complete the installation of its state-of-the-art technology to commence trading.
The LCFE’s Acting Managing Director and Chief Executive Officer, Akin Akeredolu-Ale, described the approval as a welcome development.
This, he said, indicates SEC’s dynamism and capacity to empower capital market operators to play a pivotal role in capital formation and wealth creation, and underscored the essence of capacity building to improve efficiency and service delivery.
He explained that the trading floor of LCFE’s new corporate office in Lagos, was already wearing a new look as trading technologies, including control room and servers are being installed.
Meanwhile, capital market professionals and journalists will undergo a new phase of strategic training model by the LCFE, as part of the preparations to commence operations.
Ezeagu, had at a recent training session, explained that the core objective was to develop the much-needed for the Commodity and Futures Exchange, which ASHON is promoting.
He noted that every aspect of the capital market had been undergoing changes, adding that the professionals that would manage the new platform must have the skills and capacity to operate efficiently.
“The market is expanding and the various kinds of market we are operating are equally changing as well. From the purely equities market, we are moving into bonds; and from bonds we are thinking about commodities and derivatives.
“There is lack of capacity by members of ASHON, and we have decided upon ourselves that the best approach is to build capacity from within. We must key into these changes that are taking place to play our role as intermediaries within the market space.
“Therefore, this training which focuses on derivatives and commodities is to ensure that we sharpen the skills of our members to trade derivatives as well as commodities, futures, options and the rest of them,” Ezeagu said.
A member of ASHON’s technical partners, Subbiah Rajagopa of Chella Private Limited, argued that for ASHON to float a specialised exchange, it is necessary to expose its members to the rudiments of commodity and derivatives market.
He noted that from the African perspective, Nigeria used to be the largest economy in terms of the size of its Gross Domestic Products (GDP), but due to the last two to three years of recession, had shrunk.
“Therefore, this is the right time to start investing in such products like derivatives and commodities because Nigeria has a large population, which depends on farming, and it is important that these farmers finally start benefiting from such marketing institutions, automation and technology,” he said.