KARACHI: Chairman Securities and Exchange Commission of Pakistan on Tuesday said the SECP was determined for creating a more competitive and efficient playing field to Exchange Traded Funds (ETFs) through addressing tax disparities, achieving tax credit and working allowing investments in ETF through Special Convertible Rupee Accounts (SCRA).
SECP Chairman Aamir Khan was speaking at ETF-Gong Ceremony at Pakistan Stock Exchange (PSX).
PSX on Tuesday held a gong ceremony to formally mark the launch of ETFs at PSX. These ETFs are NIT Pakistan Gateway Exchange Traded Fund, UBL Pakistan Enterprise Exchange Traded Fund, Meezan Pakistan Exchange Traded Fund and NBP Pakistan Growth Exchange Traded Fund.
Aamir Khan said SECP was also taking measures to encourage more market makers to come up, increasing awareness for expanded outreach of ETFs and working to make ETFs available not just at Ready Counter, but at each and every counter including Futures, MTS etc. He said the successful launch of ETFs had confirmed the appetite in market for new products. SECP focused at encouraging new listings in the stock market, promoting capital formation and facilitating ease of doing business
SECP Chairman revealed that another set of ETFs was under process, demonstrating that the market and investors were anticipating growth over the near term. Aamir Khan expressed his confidence that with the growth of ETFs in future, the idea of offering goals-based investment solutions would make further inroads in the financial services sector in Pakistan.
Speaking at the occasion, CEO PSX, Farrukh Khan, said the launching of ETFs was an important development in the PSX growth story. Globally ETFs are now probably the single largest asset class, worth over $7 trillion in market cap. “So, it is not only exciting but it was imperative that we bring this innovative instrument to investors in Pakistan’s capital markets”, he said. “We hope that this product will be a popular investment option for the retail and institutional investors,” he said and urged brokers and AMCs to produce research and educate investors about that unique and attractive investment product. This has the potential to increase share ownership and gains from the stock market to a broader segment of investors.
Speaking at the launch of the two new ETFs at PSX, MD NIT Adnan Afridi said, “I am very pleased to note other asset management companies in the country have also come forward following the initiative taken by NIT to launch their ETF products. This will go a long way in providing depth to the capital markets of the country”.
CEO of UBL Fund Managers Ltd, Yasir Qadri, said, “It is very humbling for UBL Funds to jointly launch the first ETFs of Pakistan. SECP has not only been supportive, they have played a leadership role in this pioneering initiative. Appreciation is also due for PSX team and the market makers.”
CEO of Al Meezan Investment Management Ltd, Mohammad Shoaib, while expressing his excitement at the launch of the first Islamic ETF in Pakistan said it was tracking one of the strongest and most diverse investment baskets.
CEO of NBP Funds, Dr Amjad Waheed, highlighted the benefits, flexibility and diversification that NBP Pakistan Growth Exchange Traded Fund offers to its investors by investing in 15 blue chip stocks listed at PSX across six sectors. The CEO of JSGCL also spoke on the occasion. JS Global played a very important but less visible role as the Market Maker for the ETFs. Market Makers provide the essential service of ensuring liquidity for an investment product.
The ETF is an investment product which combines the returns offered by the stock market with the diversity offered by a mutual fund. It is a cost-effective, transparent and provides diversified investment opportunities to investors.
The ceremony was attended by PSX Chairman of the Board, Sulaiman S Mehdi and members of the board; Commissioner SECP, Farrukh Sabzwari and senior management of SECP; and Directors, CEOs and senior management of other capital market entities.
Copyright Business Recorder, 2020
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