NAIROBI, Kenya July 6-The Nairobi Securities Exchange(NSE) has waived the transaction levy on all equity day trades for the next 30 days effective July 6, 2022.
A day trade is the second leg trade on the opposite side that reduces or fully offsets a previously created position on the same day.
This is to enable Kenyans participate and take advantage of daily price movements of securities listed on the NSE.
“This move is expected to increase activation and enhance day trading at the Nairobi Securities Exchange. Equally, it is aimed at reducing overall trading fees for investors who seek to take and offload position on the same day,” said NSE CEO, Geoffrey Odundo.
Day trading which was introduced in November 2021 allows investors and speculators to make several trades in a day with the potential to make a profit from price changes.
Previously, shares bought could not be sold on the same day and one had to wait until the transaction is cleared. The introduction of day trading is meant to give more options to traders and investors besides boosting liquidity in the market.
Investors at the NSE have continued to steadily take up day trading, with the new segment inching toward Sh1billion of total trades at the bourse in March.
The NSE traded shares worth Sh19.8billion during the month, with day trading accounting for Sh983million, 5.1 per cent of the trades.
Since launch of day trading, the NSE has been offering an incentive where 5 per cent of the NSE transaction levy is
waived on the square off trade.
The applicable NSE levy on the day trade is therefore 0.114 per cent as opposed to the normal 0.12 per cent. Following the announcement, NSE will waive the entire 0.12 per cent levy on the second leg for a period of one month.
Same-day trading is part of innovations aimed at boosting trading and liquidity at the NSE, which is the main entry point for foreigners seeking to invest in East Africa.
