27 May 2013

An investment in the Bettabeta Exchange Traded Fund (ETF) provides investors in Botswana with low cost, diversified exposure to 40 companies.

The head of Beta Solutions, Ms Nerina Visser said the Bettabeta ETF, which is the NedBank Bettabeta Equally Weighted Top 40 ETF, has been listed on the Botswana Stock Exchange (BSE) since 2011. 

The 40 companies, she said, represent a broad range of industries, geographies and currencies through the multitude of global companies listed on the Johannesburg Stock Exchange (JSE).

She stated that ETF trades and settles in Pula on the BSE, and that quarterly distributions were also made in Pula to investors through the Botswana Central Securities Depository (CSD) and have been afforded the local asset status by the Non-Banking Financial Institutions Regulatory Authority (NBFIRA).

Ms Visser said traded fund were suitable to a broad range of investors from institutional investors looking for a broader range of investment exposures on the local market, to retail investors wanting a balanced lower risk equity investment. 

She said ETF have unrestricted liquidity which is imported from the JSE through an open ended fund structure.

Ms Visser also said ETF ensures increased diversification including currency diversification; helps reduce volatility and achieves competitive returns for the overall investment portfolio. 

She highlighted that investment allows Botswana investors to get exposure to many companies operating locally and elsewhere on the African continent.

Ms Visser stated that investors in Botswana could buy more shares at a lower price if the Rand depreciates against the Pula. However, she said local investors have not yet taken up the opportunity to invest in the BettaBeta ETF due to lack of awareness, lack of familiarity amongst brokers as well as lack of access to retail investors. ENDS