On Monday, the Nairobi Securities Exchange made history by trading its first Exchange Traded Fund (EFT).
This is after Barclays listed 400,000 gold-backed units. The units had Sh. 1.125 worth of trades. According to market data, the Barclays EFT traded 900 units at a price of Sh. 1,250 a piece. This pricing was based on yesterday’s price of gold in the international market which stood at $1,255.90.
“It is fair to say that the interest is there for the securities, but also in practical terms the big buyers will be fund managers, who will need to educate their trustees to ensure that they understand how it works so that they can start to invest in it,” said Barclays Kenya head of markets Anthony Kirui.
Barclays is currently acting as the market maker by availing gold units to other stockbrokers on behalf of interested buyers.
The pricing is currently based on real time price of gold in international markets — where one unit is pegged on the price of a hundredth of a troy ounce of gold and the prevailing shilling/dollar exchange rate.