NGX REGCO WARNS TRADERS TO AVOID SPECULATION, PRIORITIZE UNDERLYING FUNDAMENTALS
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By: Muftau Fatimo
NGX Regulation Limited (NGX RegCo) has issued a strong advisory to investors, cautioning against speculative trading and encouraging market participants to anchor their investment decisions on verified company fundamentals rather than rumours or unconfirmed information.
In a statement released on Wednesday in Lagos, NGX RegCo — the independent regulatory subsidiary of the Nigerian Exchange Group — drew attention to significant price fluctuations recorded in the shares of some listed companies in recent trading sessions.
The Exchange explained that the notice forms part of its routine market surveillance responsibilities aimed at preserving a fair, orderly, and transparent trading environment.
Commenting on the development, the Chief Executive Officer of NGX Regulation Limited, Olufemi Shobanjo, stated: “Our core mandate is to uphold a level playing field where investors can transact with confidence, supported by timely and reliable information.”
“This advisory is a routine communication, reinforcing that sound fundamentals, not speculation, remain the foundation for sustainable investment outcomes. We are fully committed to preserving the integrity and stability of our market.”
The regulator encouraged investors to prioritise informed and disciplined decision-making by relying on publicly available information. This includes conducting a thorough assessment of company fundamentals, financial performance, and risk profiles.
NGX RegCo also advised investors to exercise due diligence and avoid trading based on rumours or unverified tips. Where necessary, the regulator recommends consulting licensed intermediaries such as stockbrokers or investment advisers to guide investment choices.
Reassuring the public, the NGX emphasised that despite the recent volatility in specific stocks, the broader market remains stable and resilient.
“NGX RegCo reassures all stakeholders that Nigerian Exchange remains stable, well-regulated, and resilient,” the statement read.
The Exchange reiterated its commitment to maintaining a marketplace where investors can operate with assurance, backed by strong regulatory oversight and transparent trading processes.
The advisory also serves as a prudent reminder for market participants to look past short-term price surges and instead concentrate on the fundamental, long-term value drivers of the companies they choose to invest in.
In recent weeks, shares of tier-one and tier-two Nigerian banks have recorded notable gains. The upward momentum has largely been attributed to year-end portfolio rebalancing, appealing valuations, and expectations of dividend payouts.
NGX RegCo leverages advanced surveillance technology to track trading activity in real time. Whenever a stock records price movements beyond established statistical limits — such as a 10 per cent or 20 per cent swing without any accompanying corporate disclosure — the system automatically generates an alert for further review.
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