NGX, PenCom Assure Of Broader PFA Participation In Equity Market Via Pension Broad Index

Almost six months after its launch, the Nigerian Exchange Limited (NGX), on Thursday morning said it is partnering the National Pension Commission (PenCom) to enable Pension Fund Administrators (PFAs) deepen their participation in the nation’s equity market.

The NGX Pension Broad Index (NGXPENBRD), designed to track the performance of equity securities that adhere strictly to the profitability and dividend payment criteria, was launched on June 15, 2023, as a broader benchmark for equities investment by the pension industry. It is one of the parameters specifically tailored to the pension industry.

With an all-encompassing approach, the NGX explained, the index which currently features 84 equities, imposes no limits or caps on the number of stocks it can include as constituents. It aligns seamlessly with the provisions of the Pension Reform Act of 2014 and the Amended Regulation on the Investment of Pension Fund Assets proposed by PenCom.

The NGX Pension Broad Index, the statement assured, has exhibited robust performance since its launch last year. The index stands out for its well-diversified composition, encompassing high-quality stocks across key sectors, including Banking, Insurance, Oil & Gas, Consumer Goods, and Industrial Goods.

It quoted Jude Chiemeka, Acting Chief Executive of the Nigerian Exchange Limited, while expressing gratitude for PenCom’s insightful partnership, stressing that the collaboration “underscores a shared commitment to fostering transparency, compliance, and growth within the Nigerian capital market.”

He appreciated “the approval granted by the National Pension Commission for the NGX Pension Broad Index (NGXPENBRD) to serve as the benchmark index for Nigeria’s Pension industry equity investment portfolios. This further solidifies the credibility of the index as a reliable yardstick for evaluating the equity performance of pension industry investments.”

The NGX Pension Broad Index, the NGX further added, is poised to play a pivotal role in guiding investment decisions and enhancing the overall stability of Nigeria’s pension industry.