‘Mid-level Investors Boost Liquidity In Capital Market’

Managing director and chief executive officer of Arthur Stevens Asset Management Limited, Olatunde Amolegbe has highlighted the growing presence of mid-level investors in the Nigerian capital market, emphasizing their critical role in boosting market liquidity.Speaking at the Capital Market Correspondents Association of Nigeria (CAMCAN) 2024 Market Review and 2025 Projection event held in Lagos, themed ‘In-Depth Evaluation of the Capital Market in 2024 and Prognosis for 2025’.

Amolegbe noted that these investors are more risk-tolerant than traditional participants, saying that “they are not only willing to trade but are also seeking to take strategic stakes in companies, aiming to drive internal changes and unlock 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 pointed to the recent activity in stocks that had been dormant for years as evidence of this trend, explaining that “for instance, in the case of Tantalizers Plc, whose share price surged by 336 per cent in 2024 after years of inactivity.

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“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.”

Amolegbe emphasised that “for any capital market to be truly liquid, it requires the participation of diverse investor groups. The increasing interest of mid-level investors has brought about a much-needed boost to the Nigerian capital market, creating liquidity in previously stagnant stocks and enabling 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 significant evolution in investment patterns, is poised to benefit from this shift as it seeks to attract more diverse participation and enhance market activity.