The total value of domestic transactions on the Nigerian Exchange Limited (NGX) in March 2023 was N476.52 billion against N53.71 billion which was the total foreign transactions carried out during the same period.

This was contained in the domestic and foreign portfolio investment report of Nigerian Exchange Limited for January 2023 obtained by Nairametrics.

Further analysis showed that the total value of domestic transactions outperformed transactions executed by foreign investors by N422.81 billion or 787%.

This follows low sentiments majorly on the part of foreign investors arising following the build-up to the 2023 election and other economic headwinds.

Investors sentiment is usually weak during the pre-election period as they seek to reduce their market exposure when elections draw closer.

March transactions

As of 31 March 2023, total transactions at the nation’s bourse decreased by 22.60% from N188.91billion (about $409.72 million) in February 2023 to N146.22 billion (about $317.09 million) in March 2023.

The performance of the current month when compared to the performance in March 2022 (N185.26 billion) revealed that total transactions decreased by 21.07%. In March 2023, the total value of transactions executed by Domestic Investors outperformed transactions executed by Foreign Investors by circa 88%.

Further analysis of the total transactions executed between the current and prior month (February 2023) revealed that total domestic transactions decreased by 19.06% from N169.29 billion in February to N137.03 billion in March 2023.

Similarly, total foreign transactions decreased more significantly by 53.16% from N19.62 billion (about $ 42.51 million) to N9.19 billion (about $19.94 million) between February 2023 and March 2023.

Institutional and retail investors

According to the report, Institutional Investors outperformed Retail Investors by 22%. A comparison of domestic transactions in the current and prior month (February 2023) revealed that retail transactions increased by 51.85% from N34.79 billion in February to N52.83 billion in March 2023.

However, the institutional composition of the domestic market decreased significantly by 37.40% from N134.50 billion in February 2023 to N84.20 billion in March 2023.

Performance in a decade

Highlights of the performance of the market over the last decade showed that over sixteen years, domestic transactions decreased by 45.30% from N3.556 trillion in 2007 to N1.945 trillion in 2022 whilst foreign transactions also decreased by 38.47% from N616 billion to N379 billion over the same period.

Total domestic transactions accounted for about 84% of the total transactions carried out in 2022, whilst foreign transactions accounted for about 16% of the total transactions in the same period.

What you should know

The Domestic and Foreign Portfolio Investment Report is prepared monthly by NGX Regulation Limited, with trading figures from market operators on their Domestic and Foreign Portfolio Investment (FPI) flows. These transactions are carried out by Domestic and Foreign investors. Domestic investors are further categorized into Retail and Institutional investors.