SEC tasks investors on investment diversification to mitigate risk

The Securities and Exchange Commission (SEC) on Wednesday stressed the need for retail investors to diversify their investment portfolio in order to mitigate risk.

Ms Mary Uduk, SEC Acting Director-General, stated this at one-day maiden National discourse organised by Pragmatic Shareholders Association of Nigeria (PSAN) in Lagos.

Uduk said that investors must learn to invest in various asset classes to mitigate risks and exposure.

The director-general who was represented by Mr Stephen Falomo, the Director, SEC, Lagos Zonal Office, said that it was imperative for investors to have a mixed bag of investment instruments.

“Investment in the Nigerian capital market, just as in any other capital market across the world is a mixed bag of fortunes.

“A smart investor is expected to have this consciousness at the back of his mind at all times, even as he wades into the market, to pick his choice instruments or instrument of instruments investments,’’ Uduk said.

Speaking on the theme: “Portfolio Investments: Opportunities and mounting challenges for Nigerian Shareholders’’, she said that investors should seek knowledge before investing in the capital market.

She said that there were good opportunities to achieve decent returns on investment in the market.

Uduk, however, said that an investor must be smart to avoid some obvious mistake which could lead to capital erosion through mixed bag of investment.

She explained that an investment portfolio connotes a mixed bag of investment instruments such as shares and bonds.

Uduk said that investment in mutual funds had continued to be a worthwhile investment in the recent time.

She called on shareholders associations to join hands with the commission to support its initiatives, especially, the e-dividend mandate registration drive.

Uduk said that the commission was committed to significantly reducing the volume of unclaimed dividend in our market.

“SEC will continue to solicit for your support until we achieve 100 per cent implementation of the project.

The commission is committed to supporting all association in the capital market as we all work progressively towards the stability and development of the Nigerian capital market,’’ Uduk said.

Earlier, Mrs Bisi Bakare, PSAN National Coordinator, said that the maiden lecture was organised to raise awareness and consciousness of the role of domestic shareholders in the ongoing effort to revamp and sustain the economy.

Bakare said that the lecture would create an avenue for shareholders to highlight categorically their challenges towards long-term success savings through portfolio investments.

She, however, called for a review of indigenisation economic blueprint channeled toward meeting the demands of globalisation and strengthening of the national economy.

Bakare also urged the Federal Government to promulgate a niche policy that provides support for retail shareholders.

The PSAN boss appealed to SEC to make the e-dividend registration policy an open ended policy to allow more Nigerian shareholders key into it and reap the dividend of their investment.