Nigerian Exchange Limited (NGX) has announced the launch of West Africa’s first Exchange Traded Derivatives (ETD) market with Equity Index Futures Contracts.

This, according to the Exchange, is consistent with its commitment to develop the Nigerian capital market by providing a market that thrives on innovation and responds to the needs of stakeholders in accessing and using capital.

The launch of NGX ETD market saw the listing of two Equity Index Futures Contracts, NGX 30 Index Futures and NGX Pension Index Futures, with more securities to be added in the future.

The Exchange said that to promote clearing efficiency, stability, and confidence, it has collaborated with a premier Central Counterparty (CCP) in Nigeria, NG Clearing Limited, to provide the clearing infrastructure for NGX derivatives market and its clearing members – Access Bank and Zenith Bank.

The ETDs market will commence with trading activities by the first three trading license holders – CardinalStone Securities Limited, Meristem Securities Limited and APT Securities and Funds Limited – which have been cleared by NGX Regulation Limited to facilitate transactions on behalf of investors on the NGX derivatives market.

ETDs are standardised, highly regulated, and transparent financial contracts listed and traded on a securities exchange, and guaranteed against default through the clearing house of the derivatives exchange.

Commenting on the launch, Chief Executive Officer (CEO), NGX, Mr. Temi Popoola, commended the efforts of stakeholders who have successfully driven the completion of the derivatives market since 2014.

“I would like to specially acknowledge the work that was done under the previous management of the Exchange, led by Mr. Oscar Onyema, whose contributions have formed the foundation of our present gains and accomplishments made manifest through the launch of NGX ETDs market.