Bourse to introduce FTSE-based indexes

November 01 - The Nairobi Securities Exchange (NSE) said on Tuesday it plans to introduce indexes based on those of FTSE Group on its bourse next week, with the aim of establishing exchange-traded funds on the east African bourse. An exchange-traded fund (ETF) comprises a basket of assets, usually the main constituents a major share market index, and can be traded on an exchange, sold short or be bought on margin.

ETFs trade like stocks and allow investors to diversify their risk over a broad spread of assets. "The new indices will lay the foundation for the creation of ETFs and other index-based products and will further attract enhanced foreign investment in the local market," the NSE said in a statement. It gave no further details on the indexes due to be unveiled at a ceremony next week.

Kenya is pushing to diversify offerings on its capital markets. The region's biggest economy is in the process of setting up a futures market to allow investors to trade in currency, mineral, energy and agriculture derivatives. At present Kenya's bourse conducts only spot trades. source: http://af.reuters.com/article/kenyaNews/idAFL5E7M11A620111101