Investor protection now more critical – SEC boss

The Adumhene being assisted by some management members to announce the IPO of the NGIS Money Market Fund

The Securities and Exchange Commission (SEC) has assured that it is committed to safeguarding funds of investors entrusted to the care of various operators under its watch, by ensuring strong regulatory compliance.

It said it will ensure that market operators do what is expected of them as defined in the regulatory framework of the capital market.

To this end, the regulator of the securities industry also indicated it intends to embark on a “sustained” investor protection drive. aimed at educating investors to become informed on activities of the capital market.

Director General of SEC, Rev. Ogbarmey Tetteh

According to the Director General of SEC, Daniel Ogbarmey Tetteh: “One of the powerful ways to achieve investor protection is to give investors the needed information to make the right choices and the right decisions”.

He thus urged investors to have confidence in the regulatory body as well as licenced market operators, adding: “If you are going to deal with any market operator, make sure that operator is licenced by the Securities and Exchange Commission”.

This, he explained, is because there are a few pretenders out there – making it useful to confirm the legitimacy of market operators before transacting any business with them.

Daniel Ogbarmey Tetteh, who was speaking at the launch of NGIS Money Market Fund Limited in Kumasi, further entreated investors to “ask questions and get good advice” through their interactions and dealings with market operators.

See Also:  Access Bank to rebrand soon 

He however cautioned investors to “avoid following the crowd, because that can lead you nowhere”, while emphasising there is a trade-off between high returns and high risk.

“We find that there are a number of people offering very high returns within the economy. I would like you to know that anytime anybody offers you high returns it means there is also high risk.”

Touching on some major developments within the market, he disclosed that fund managers have been asked to stop issuing fixed-term investment products to investors. In other words, the days of going to a market operator and them asking for your money for a certain number of days or months in return for certain guaranteed returns are over.

“We believe we need fund managers who will use their skills, experience, and knowledge to manage a portfolio of securities that will hopefully yield good returns for their people.”

One underlying reason for this development, he noted, is the belief that collective investment schemes, mutual funds and unit trusts are very appropriate investment vehicles.

So far, at the end of 2017 there were 53 collective investment schemes made up of 34 mutual funds and 19 unit trusts.

While the ease and affordability of investing in collective investment schemes makes them very recommendable to the public, fund managers and boards of directors have been strongly advised to deploy the right corporate governance practices in their operations.

See Also:  Unemployment higher among high school leavers – ISSER

The NGS Money Market Fund, which was launched at the ceremony, is an open-ended mutual fund designed to create wealth for investors – who are expected to be mostly individuals from the economy’s formal and informal sectors.

According to the managers, the Fund will invest in a diversified portfolio of securities in their short-, medium- and long-term. It is offering a minimum of 200,000 shares, and also consists of an unlimited number of shares at an initial cost of GH¢0.50 per share.

The minimum investment purchase of shares under the initial public offer is set at 200 shares, and thereafter in multiples of 100 shares.

The prospectus for the NGIS Money Market Fund was issued under the Securities Industry Act, 2016 (Act 929) and the Unit Trusts and Mutual Funds Regulations, 2001 (L.I. 1695).

The initial public offering period for shares which commenced on August 2, 2018 is expected to end on August 22, 2018.

The Board Chairman of the NGIS Money Market Fund, Prof. K. Dwumor Kessey, disclosed that the NGIS now has a permit from the National Pensions Regulatory Authority (NPRA) to manage corporate and group pension schemes, which could benefit economic actors across the economy’s various sectors.

He therefore urged, particularly, those in the informal sector to take advantage of the opportunity created to be assisted in establishing a befitting pension scheme that caters for their tomorrows.

Leave a Reply

Please Login to comment
  Subscribe  
Notify of