There are indications that foreign investors pulled out a total of N209.76bn from the Nigerian stock market from January to November last year, official data obtained on Friday show.
The Nigerian Exchange Limited, in its latest domestic and foreign portfolio investment report, revealed that foreign investors injected N189.42bn into the stock market in the 11-month period.
Foreign portfolio investment outflow includes sales transactions or liquidation of portfolio investments through the stock market, while the FPI inflow includes purchase transactions on the NGX (equities only), according to the bourse.
The total transactions at the nation’s bourse decreased by 7.95 per cent from N213.07bn (about $513.31m) in October 2021 to N196.14bn (about $472.54m) in November.
The total transactions in November decreased by 38.28 per cent when compared to the same month in 2020, according to the NGX.
The total value of transactions executed by domestic investors in November outperformed those executed by foreign investors by about 30 per cent.
The total domestic transactions decreased by 25.82 per cent from N170.65bn in October to N126.58bn in November.
“However, total foreign transactions increased by 63.98 per cent from N42.42bn (about $102.21m) to N69.56bn (about $167.58m) between October 2021 and November 2021,” the NGX said.
It said the institutional investors outperformed retail investors by 28 per cent in November.
According to the NGX, the retail transactions decreased by 21.99 per cent from N58.34bn in October to N45.51bn in November.
“Similarly, the institutional composition of the domestic market decreased by 27.82 per cent from N112.31bn in October 2021 to N81.07bn in November 2021,” the bourse said.
The Vice-President, Prof. Yemi Osinbajo, said recently that the profit-taking activities of foreign and domestic institutional investors in the Nigerian stock market had created an excessive risk premium.
He said to usher in the return of foreign and domestic institutional participation, all government agencies and regulators in the financial system, among other key stakeholders, must work with the NGX to tackle the excessive risk premium within the market.