The number of Batswana who are now turning to the stock exchange for investment purposes jumped up by 300 percent year-on-year as they try to take advantage of the buoyant equity market, brokers said last week.
The move comes at a time when the markets are on their high, largely pushed by banking stocks and other consumer stocks.
“One thing that pleased me this year is the number of retail clients which are up 300 percent and most of them were first time buyers,” head of Motswedi Securities, Martin Makgatlhe, said last week.
“ Maybe we are seeing a change of attitude in terms of savings,” he added.
The move comes at a time when the exchange is growing at the fastest rates in history, jumping from market capitalization of P 13 billion at the close of last year to a high of P23.5 billion.
The prime drivers were said to be institutional investors, mainly the pension fund industry. However, retail investors have also pulled surprise punches.
“ There is more interest in the market from retail investors. We are seeing more and more individuals coming to buy shares in big volumes. People used to buy in hundreds but now they start with 1000 or 2000 shares and they keep on toping them up,” an analyst at Capital Securities, Leutwetse Tumelo said.
“ Look at Stanchart shares the other day. An individual snatched 20, 000 shares of that bank which is very uncommon in our market. And there is a general rise of numbers of individuals who buy shares as compared to last year; it is somewhere around 300 percent increase.
“People have realized that they can get as much as 100 percent return on their investment within a month by buying a performing stock as against 8 percent interest per annum at the bank,” he added.
Makgatlhe said, given the current development, there is a need for the exchange and its members to come with a strong regulatory framework that will govern all market players to ensure that the interests of the clients are protected. Among those issues include the establishment of central depository system, automation and tough act that would illuminate some rogues.
“It is import that our clients should have faith in us and we should try to make sure that we put the interest of our clients first,” Makgatlhe said.
The new developments come at a time when most of the stocks are expected to come with fresh strong valuations from analysts during the month. The financial services sector and mining are expected to have much stronger valuations.
Meanwhile, Investec Asset Management has been behind Letshego Holdings’ big trades, which hit over 10 million within a week. Investec, which is trying to shy away from high banking share price, started to target Letshego from August, according to share register.