The growing presence of mid-level investors in the Nigerian capital market is crucial for boosting market liquidity, says Olatunde Amolegbe.

Amolegbe, Arthur Stevens Asset Management CEO, stated this on Monday in Lagos. He was speaking at the Capital Market Correspondents Association of Nigeria 2024 Market Review and 2025 Projection. The event was themed ‘In-Depth Evaluation of the Capital Market in 2024 and Prognosis for 2025’.

He explained that this group of investors was more risk-tolerant than traditional participants. Mr Amolegbe added that they were not only willing to trade but also seeking to take strategic stakes in companies, with the aim of driving internal changes and unlocking hidden value.

“These emerging investors are willing to seek capital not just for trading but also to secure a foothold in companies where they can influence operations and unlock value that others may have overlooked,” he said.

Mr Amolegbe cited the recent activity in stocks that had been dormant for years as evidence of this trend. He highlighted the case of Tantalizers Plc, whose share price surged by 336 per cent in 2024 after years of inactivity.

“Some of these stocks had not traded 100,000 shares in the past five years. Suddenly, in recent months, they are trading millions of shares. This demonstrates the emergence of a new subset of investors entering the market,” he said.

Mr Amolegbe emphasised that for any capital market to be truly liquid, it required the participation of diverse investor groups. He noted that the increasing interest of mid-level investors had brought a much-needed boost to the Nigerian capital market.

According to him, it also creates liquidity in previously stagnant stocks and enables more dynamic trading activities.

“These investors are welcome. While some might say they are taking risks, I believe they are instrumental in creating liquidity in the marketplace. Often, they bring about the changes necessary for companies that have been stagnant for a long time to thrive.

“The Nigerian capital market, which has witnessed a significant evolution in investment patterns, is poised to benefit from this shift as it seeks to attract more diverse participation and enhance market activity,” he said.

(NAN)