| Trade alert. Investors
bemoan dearth of information flow
By AMECHI OGBONNA
Thursday,
March 29, 2007
Barely two years after the launch
of Trade Alert scheme by regulators of the capital market, Nigerian investors
have expressed concern over its inability to achieve the purpose for which it
was established in 2005.
The anxiety was coming against the backdrop of
the inability of the Nigerian Stock Exchange to constantly furnish shareholders
with information relating to transactions on their stocks.
The investors
who spoke to Daily Sun recently, complained that despite the subscription fees
paid to the Nigerian Stock Exchange, and assurances by the exchange that the subscribers
would be kept abreast of activities in the market, especially as it relates to
their investments, the situation on ground today suggests that the system has
collapsed less than two years after its takeoff.
The agitated investors
who warned they would demand a refund of their initial subscription fees paid
for the scheme, said they be forced to confront the NSE and the Securities and
Exchange Commission if the situation persists.
One of the issues of concern
according to them, was that the development has made many lose track of trends
in the market, since the NSE machinery set up for that purpose has failed to confirm
investors stock position on demand.
Efforts made to ascertain the cause
of the present empasse was not suceessful as officials of the NSE who would have
spoken on the matter were said to have traveled to Dubai for official engagement.
Meanwhile,
a source at the exchange said the present problem faced by the shareholders was
sequel to NSE’s effort to install a higher grade of IT package that would
power the scheme
The Trade Alert scheme was introduced by the NSE in 2005,
as an avenue for informing or alerting company shareholders and investors of any
form of transaction on the shareholding to ensure that only legitimate buy and
sale orders were allowed in the nation;s capital market.
Under the scheme,
a company, shareholder is promptly alerted of any sale of shares held by him in
any company before that deal is consummated within the exchanges clearing period
irrespective of where he or she is living.
If through this medium he confirms
knowledge of the transaction, it would be allow to proceed, otherwise the NSE
and SEC would be advised to cancel the deal.
Promoters of the scheme, however,
described it as part of the exchange’s response to rampant cases of illegal
and unauthorized sale of investors’ equity on its floor.
It would
be recalled that the trade alert scheme was one of the most controversial policies
adopted by the Nigerian Stock Exchange in recent times following serious opposition
it got from the dealing members of the exchange.
The Nigerian Institute
of Stock Brokers for instance, insisted that subscription to trade alert be made
optional, although the NSE and SEC insisted it should be compulsory in view of
the various cases of illegal transactions on the shares of some investors.
Observers
believe that the latest turn of events may have confirmed fears earlier expressed
by some stakeholders that the scheme may not be sustained
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