By Thomas Mupfuka
The Zimbabwe Stock exchange (ZSE) says investing in the stocks is one of the best investment options under the current inflationary environment.
This comes as the local bourse is planning to embark on roadshows to educate citizens on how to invest on the equities market.
Newly-appointed ZSE chief executive officer Justin Bgoni told Standardbusiness that their first port of call would be Bulawayo, where they are expecting to hold a workshop with companies in the region that have the potential to list on the ZSE.
The bourse will advise companies on the benefits that are associated with listing before a roadshow to educate locals on how to buy shares on the market is held in the city.
“We recently held a listing workshop in Harare, where we invited all companies that we believed can benefit from listing on the stock exchange,” Bgoni said.
“We explained to them the benefits, advantages, obligations and almost everything about listing.
“So, we are going to do something similar in Bulawayo, but this time we will also call upon ordinary citizens and do a presentation on how to invest on the stock market.
“In most countries, you get about 15% of the people trading on the stock market, meaning that 15% of the value comes from ordinary people, but in this country it’s close to zero.
“People must know what is a share, how do you trade them, when is it good to sell and when is it good to buy.”
Bgoni added: “When a country is facing inflationary pressures, people tend to come to the stock market because it tends to be a good cushion because they are
preserving wealth, but that is not why I want people to come to the stock market.
“The reason is that I want them to know that they can build wealth there.”
Meanwhile, investment analyst Enock Rukwara said the ZSE campaigns if properly rolled-out would discourage laymen from preserving wealth by buying foreign currency on the parallel market, which comes with a lot of risks associated with the fluctuation of the exchange rates.
“This is an excellent and timely initiative given the prevailing macroeconomic conditions,” he said.
“To a layman, buying US dollars seems to be the best option available, hence factors like transaction costs, availability of investment alternatives within stock market investments and diversification are also key when comparing stock markets to alternative investment options.”