Kenyan, Shenzhen bourses to boost cooperation

NAIROBI, Oct. 24 (Xinhua) -- Kenya's Nairobi Security Exchange (NSE) and China's Shenzhen Stock Exchange plan to sign a memorandum of understanding (MOU) to boost their cooperation, an official said on Wednesday.

NSE CEO Geoffrey Odundo told Xinhua in Nairobi that the Shenzhen Stock Exchange is one of the most vibrant security exchanges in the world despite being relatively young.

"The agreement with the Shenzhen Stock Exchange will revolve around capacity-building, product knowledge, as well as attracting Chinese investors into the Kenyan capital markets," Odundo said during the launch of the Absa Africa Financial Markets Index 2018.

NSE has already signed an MOU with the Shanghai Stock Exchange.

The NSE has just concluded a study tour of the Chinese stock exchanges.

Odundo said Kenya is also seeking to gain knowledge from China on how to increase the number of listings at the NSE.

The MOU with the Shenzhen Stock Exchange comes at an ideal time as Chinese investors are adopting a strategy of investing overseas, he said.

Odundo said a number of Chinese firms have expressed interest in listing and raising capital at the NSE.

The NSE also plans to launch a derivatives market in the first quarter of 2019.

"We are now conducting a pilot phase using cash and we will use the output to inform the exact date of the launch of the derivatives trading," he added.

Once the derivatives market is launched, it will provide an appropriate avenue for investors to both diversify their portfolio and protect investments from the volatility of the securities market, Odundo said.