The B&FT reported in March that the GSE will offer derivatives trading from next year. Any news about more activity on the GSE is good news. The GSE-CI is down 11% YTD and GSE Chairman, Dr Sam Mensah has complained about how illiquid the bourse is compared to other exchanges in the region.
Another piece of good news is that the Commodities Exchange is expected to be launched in Q1 2017. The GCX will start with rice, corn and soy and will launch with only spot trading before they introduce futures as investors gain confidence in the exchange.
And that’s is not all. The Ghana Home Loans is going to list GH¢380m ($100m) worth of mortgage-backed securities on the Ghana Alternative Exchange (GAX). Exciting isn’t it?
There are quite a number of retail investors in Ghana trying their luck at the forex, commodity and equity markets and I believe they would be willing to trade local alternatives if the market is well-developed. Foreign investors can also take advantage of this growing securitization to take short-term positions in Ghana that would previously have required private equity.
These new prospects have many upsides including creating jobs, raising capital for businesses, improving liquidity and lowering borrowing costs. However, there is always the threat of heavy losses and unethical practices. The SEC will have to bring its A-game. And so will traders.