Saturday, January 22, 2022

Absa Capital to list NewPlat ETF on BSE in Q3: 2014

The Botswana Stock Exchange could have another Exchange Traded Fund as the sponsors of the previous ETF are at advanced stage to have platinum debenture traded locally. The listing of the platinum supported exchange traded fund (NewPlatinum ETF) could be done before the end of the year, according to BSE’s Deputy Chief Executive Officer, Thapelo Tsheole.??”Absa Capital of South Africa is in the process of listing the NewPlat ETF on the BSE,” Tsheole said. “The NewPlat ETF is expected to be listed in the third quarter of 2014,” he added.??ETFs hold assets such as stocks, commodities, or bonds, and trades close to its net asset value over the course of the trading day. Most ETFs track an index, such as a stock index or bond index. ETF are attractive as investment vehicles because of their low costs, tax efficiency, and stock-like features, according to Wikipedia.

Reports in South Africa have indicated that NewPlat has outperformed the gold-backed ETF NewGold, listed by Absa Capital on the JSE about 10 years ago, despite the 11-week wage strike in the platinum belt.??”In the long to medium term, prospects for platinum are perceived to be better than gold because the global economy is recovering,” Vladimir Nedeljkovic, Head of ETFs and Index Products at Absa Capital?said as reported Business Report.??The Absa Capital NewGold ETF, which is the third largest in the world, has a primary listing on the Johannesburg Securities Exchange (JSE).??”We have experienced a significant amount of interest from investors in Botswana for the product because NewGold gives investors access to a completely new asset class,” Nedeljkovic, said in the past.

“It will also greatly increase liquidity on the BSE,” he added at the time of listing NewGold.??The NewGold ETF traded 16,937 units with a value of P1, 905,843 at prices ranging between P103.70 and P116.80 per unit in the second quarter of 2014. As at 17 June 2014, the price of the NewGold ETF had appreciated by 2.0 percent in Pula terms when compared to the appreciation in price of Gold Bullion, which appreciated by 3.6 percent in the same period. According to NewGold’s issuers annual financial statement for the year end 31, March 2014, dividends totaling R65,235,000 an increase from R46,000,000) were declared and paid to the shareholders during the year. ?On the other hand, the BettaBeta ETF traded 13,303 units at prices ranging between P35.45 and P42.50 per unit for a total value of P520, 835 during the period under review. The price of the BettaBeta ETF on?the BSE had appreciated by 9.4 percent as at 17 June 2014. ?

The local market is also looking at local ETFs that will be a symbol of Botswana like diamonds–that contribute immensely to Botswana’s GDP.?”We are waiting for the day; and I am calling all the market participants (brokers, retail and institutional investors) to come up with a local ETF,” Herin Mendis, Chief Executive Officer of the BSE said at time when NewGold ETF was listed.?NewPlat is said to be the largest ETF in Africa after NewGold and it is also listed in Mauritius.


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