Mauritius introduces new instruments and lists funds as traders get active

Sunil Benimadhu, Chief Executive Officer of the Stock Exchange of Mauritius:
The Mauritius market lost 50% in, as investors worried about the fallout of the global financial crisis, but then they realized our companies were not so badly affected, from March to December we had one of the best rebounds in 20 years, with an 80% gain. We have come back with a vengeance. Our economy was helped by swift reactions from our authorities including easing policies. We have had a volatile time, but it has also meant a shift to much more trading on the SEM.
Our exchange is trying to develop the “3 Ps” of exchanges – products, players and participants. We anticipate the players into African markets will only increase, as they realize that expected returns in the US and Europe are only 1% or 2% and need to get positive alpha. Beyond equity, we are trying to develop an active second market in debt instruments, and we are trying to move up the value chain and introduce derivatives, including an index derivative of the 7 most liquid stocks.
In the past Mauritius has been a base for funds investing into India and China, and we have traditionally been a business gateway between Africa and the East, whether for foreign direct investment or others. We are now changing our listing rules to allow more funds to list, including the global business sector,
We have already changed our rules to allow shorting on the Stock Exchange, including rules for stock borrowing. Institutions are realizing they can make money from their stocks and we are seeing more liquidity as people are able to trade more.


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