BY MTHANDAZO NYONI
FINANCE minister Mthuli Ncube has launched the investment 101 handbook and video, as investor education tools, in order to encourage participation by the Zimbabwean population in the capital markets.
The handbook also seeks to create and raise awareness of the Securities and Exchange Commission of Zimbabwe (SECZ) as well as Investor Protection Fund (IPF).
The IPF was established in terms of section 86B of the Securities and Exchange Act [Chapter 24:25] for the purpose of providing compensation to investors for losses suffered as a result of a licensed contributor being unable to meet their abilities due to insolvency, malpractice or other cause.
However, ever since the IPF was launched, very few people seem to know about it.
To overcome that, SECZ in conjunction with the IPF, decided to come up with a handbook and video to educate the citizens from all walks of life on the risks and benefits of investing on capital markets.
Officiating at the launch of the tools in Bulawayo last week, Ncube said for the economy to grow, there was a need for the Zimbabwean public to participate.
He said the more people and investors participate on capital markets, the lighter the burden of growing.
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Ncube said the investment 101 handbook would go a long way in encouraging investors to invest on capital markets.
“The concepts are explained in detail to guide any investor who is keen to invest on the capital markets regardless of their base in financial information,” Ncube said.
He said the use of local languages also played a major role in helping citizens understand capital markets.
Ncube said the more information people have, the more empowered they are to make decisions about saving and investing.
In a speech read on her behalf, Bulawayo Provincial Affairs and Devolution minister Judith Ncube said many Zimbabweans were excluded from the capital markets because “the knowledge and financial literacy education was not made accessible to them”.
“Financial literacy is critical as it empowers our citizens to make decisions about what they can do with their hard-earned money,” she said.
“With increased financial literacy, potential investors will know about the variety of investment platforms available to them as well as the risks and benefits of investing.”
The IPF is expected to play a key role in protecting local capital markets investors.
Contributors, who are registered securities dealers, remit contributions to the IPF in the form of a levy charged on every transaction when shares are bought or sold.
The contributions form the IPF’s income.
After settling the IPF’s obligations, excess funds are invested through professional investment managers who have the mandate to preserve capital and grow the fund.
The IPF board said it undertook exposure trips to similar institutions around the world in order to benchmark the operations of the fund against regional and international standards.
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