The Nairobi Stock Exchange wants treasury to rescind its move to block statutory pension funds from investing in stocks. NSE Chief Executive Peter Mwangi says the directive does not address the need for better administration of such funds, which include the National Social Security Fund. The bourse has made this appeal even as it emerged that trading in shares dipped by 64 per cent to 12 billion shillings during the first half of this year as the bond markets turnover grew by 127 per cent to 65 billion shillings.
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Totally ignoring eqiuties is not wise. Inflation will eat into this pension funds. Kenya has become paralysed by the heightened suspicion of corruption. Successful investors ALWAYS DIVERSIFY.
Uhurus directive is a necessary evil even though it is likely to impact negatively on the money markets.But there is a plus to it. One, it spares the workers from having to compete against themselves(NSSF is owned by workers who also direcly buy stocks), two, it reduces corruption in NSSF; three, it is a wake-up call for NSFF trustees to think of other areas like real estate dev.(not the Jirongo Type) and four, major investors make their money from gov. securities anyways, why should’nt NSSF???