Tuesday, May 25, 2021 / 10:00 AM / Ottoabasi Abasiekong for WebTV / Header Image Credit: Coronation Asset Management
Nigeria’s mutual funds market needs harmonized accounting standards to achieve global credibility. Mr. Guy Czartoryski, Head of Research, Coronation Asset Management disclosed this in a recent discussion on “Developments In The Nigerian Mutual Funds Market”.
According to Czartoryski the Mutual Funds market in Nigeria needs to adopt robust accounting standards to gain more visibility and woo more investors. The investment expert highlighted the fact that Nigeria had different accounting standards to get the unit prices for about 17 mutual fund products.
He described Nigeria as a strategic market for the growth of Mutual Funds in Africa, considering its population size, demographic spread, and innovative capital market.
The analyst noted that activities improved in 2020 due to the COVID-19 pandemic, which led to Nigerians saving more and investing in various segments of the mutual funds market.
Czartoryski called for increased sensitization seminars on the value of the mutual funds market, which would open up this segment of investing to a wider audience.
Looking at the 2020 performance of the market, he said the N1.6trn growth in assets in 2020 suggests that mutual funds constitute about 14% of the nation’s capital market.
He believed innovative products like the money market fund, fixed income fund, equities fund, an infrastructure fund, would deepen mutual funds in the country.
With the 50% growth recorded in 2020, the market according to him may not witness the same growth in 2021, because the COVID-19-induced lockdowns influenced the market’s performance.
He emphasized the need for Nigeria to adopt the Global Investment Performance Standards (GIPS), stressing that mark-to-market accountancy is one of the cornerstones of GIPS.
“Through the GIPS there is access to about 6,000 mutual funds from the United States, United Kingdom, Singapore, and South Africa captured in the Morning star and Financial Times Managed fund services”, Czartoryski said.