After years of intense preparation, the Nairobi Derivatives market will begin operations on the 4th of July 2019.
The Nairobi Securities Exchange (NSE) received the license to operate from the market regulators; the Capital Markets Authority of Kenya (CMA) and the Central Bank of Kenya.
It will be the number two derivatives market in Sub-Saharan Africa after the Johannesburg market.
The exchange will first start by trading single stock futures involving the most traded companies at the Nairobi Securities Exchange (NSE) like Safaricom, the KCB Group and Equity Holdings.
The platform will also trade equity index futures before introducing other derivatives like forward contracts and swaps.
The derivatives market is expected to improve the Nairobi Securities Exchange’s (NSE) status in the Capital Markets world. Additionally, traders will be able to hedge against risks by investing in the futures.
The Nairobi Securities Exchange (NSE) initially conducted a derivatives market pilot program between July and December 2018 where it picked very helpful lessons.
The exchange will be guided by the highest global standards used by the International Swaps and Derivatives Association.
The Nairobi Securities Exchange (NSE), will conduct a comprehensive derivatives training on the 27th and 28th of June 2019 that will prepare all market participants for the derivatives market.
A Derivatives Market is the financial market for derivatives, financial instruments like futures contracts or options, which are derived from other forms of assets. The market can be divided into two, that for exchange-traded derivatives and that for over-the-counter derivatives.
