Economy
Naira Settled Currency Futures Records Highest Daily Trading Volume in October
By Quantitative Financial Analytics
The daily trading volume of Nigeria Settled FX currency futures has plunged over the past weeks as the original excitement that greeted its introduction appears to have waned.
An analysis of the open interest reports issued by the FMDQ indicates that the currency futures market had momentum, going by the notable and hitherto increasing trading volume the market enjoyed from June 27th until a couple of weeks ago.
Volumes, enthusiasm wane
At introduction, the Naira settled currency market was instituted as a way to manage foreign currency risk exposure by Nigerians and Nigerian companies.
As the market got underway, the trading volume peaked so much such that some analysts and observers began to wonder whether the market was being used to manage currency risk exposure or was it providing large investors with arbitrage opportunities.
However, rather than bridge the gap between the official exchange rate and that of the parallel market as intended, the divergence between the two has been increasing instead.
Market participants traded over $1 b worth of currency futures in notional terms from June 27th to July 31 (excluding matured positions). In August alone, about $1,581.69 million worth of trades was recorded with daily transaction activity ranging from as little as $3.89m to as high as $340.63m, according to analysis by Quantitative Financial Analytics.
In comparison, currency futures trading volume fell dramatically in September as $785.15m notional was traded the entire month. Daily trading peaked on September 9, reaching $110.02m and $92.97 on 27th September.
If the trading volume in September was poor, that of October has been dismal as the FX Futures market seems to have suffered excitement fatigue.
So far in October, only $116.84 notional value has been traded with the daily transaction activity ranging from a low of $0.5m on 10/11/16 to a high of $19.57 (10/4/16). There was not a single trade on October 12th but the lull in the market seems to have eased as a whopping $43.07 million trading volume was recorded on October 18, the highest so far in October.
The reason for the declining interest could be because investors are beginning to see the market as one that does not have much to offer beyond their speculative value but for a currency like the Naira whose direction is easy to predict, there may not be much to speculate on.
Again, the divergence between the official and parallel market rates makes it less attractive to contract to sell dollar via the futures market.
Furthermore, the convergence of the NIFEX rate and the contract rates on the futures makes it more difficult to extract arbitrage opportunities from the futures contracts and therefore less attractive.
For analysts and market watchers wondering if there is a future for currency futures in Nigeria, it does look like the end is not near for the market as trading volume could peak at any time.
Source: Quantitative Financial Analytics/FMDQ
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange recorded a 3.8 per cent week-on-week decline in the 14th trading week of 2026, which had only four trading sessions.
This happened because of the public holiday observed on Friday for Easter celebrations in Nigeria and across the globe.
Last week, the market capitalisation of the bourse went down by N95.36 billion to N2.417 trillion from N2.512 trillion in Week 13, while the NASD Unlisted Securities Index (NSI) shrank by 159.39 points to 4,040.30 points from 4,199.69 points in the previous week.
In the week, there were five price losers and eight price losers led by 11 Plc, which crumbled by N94.57 to N256.60 per unit from N351.17 per unit.
MRS Oil Plc lost N39.00 to close at N171.00 per share from N210.00 per share, FrieslandCampina Wamco Nigeria Plc depreciated by N17 to N93.00 per unit from N110.00 per unit, and Central Securities Clearing System (CSCS) Plc shed N2.10 to close at N78.00 per share versus N80.10 per share.
Further, NASD Plc dropped N4.14 to end at N37.36 per unit versus N41.50 per unit, UBN Property Plc crashed by 22 Kobo to N1.98 per share from N2.20 per share, Food Concepts Plc slid by 13 Kobo to N2.87 per unit from N3.00 per unit, and Capital Bancorp Plc contracted by 10 Kobo to N1.90 per share from N2.00 per share.
On the flip side, IPWA Plc gained 55 Kobo to sell at N6.06 per unit versus N5.51 per unit, Geo-Fluids Plc appreciated by 7 Kobo to N3.25 per share from N3.18 per share, Industrial and General Insurance (IGI) Plc improved by 5 Kobo to 57 Kobo per unit from 52 Kobo per unit, Great Nigeria Insurance (GNI) Plc grew by 2 Kobo to 52 Kobo per share from 50 Kobo per share, and Acorn Petroleum Plc moved up by 1 Kobo to N1.34 per unit from N1.33 per unit.
The volume of transactions witnessed a 5,490.9 per cent surge last week to 3.5 billion units from 62.7 million units, and the value of transactions soared by 437.7 per cent to N9.7 billion from N1.7 billion. These trades were completed in 163 deals and involved 20 stocks.
The most traded stock by value was GNI Plc with N8.4 billion, followed by Okitipupa Plc with N630.5 million, Geo-Fluids Plc with N162.7 million, CSCS Plc with N57.5 million, and Friesland Campina Wamco Nigeria Plc with N37.1 million.
The most trased stock by volume was also GNI Plc with 3.4 billion units, Geo-Fluids Plc traded 50.1 million units, Okitipupa Plc transacted 21.0 million units, UBN Property Plc quoted 2.5 million units, and CSCS Plc sold 0.73 million units.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange extended its stay in the south territory with a decline of 0.56 per cent on Wednesday, April 2.
This brought down the market capitalisation by N13 billion to N2.417 trillion from N2.430 trillion, and downed the NASD Unlisted Security Index (NSI) by 22.57 points to 4,062.87 points from the previous session’s 4,062.87 points.
It was observed that the NASD exchange ended with three price gainers and three price losers during the trading day.
MRS Oil Plc depreciated by N19.00 to close at N171.00 per unit compared with the previous price of N190.00 per unit, NASD Plc lost N4.14 to trade at N37.36 per share compared with Wednesday’s N41.50 per share, and Central Securities Clearing System (CSCS) Plc gave up N2.00 to sell at N78.00 per unit versus N80.00 per unit.
On the flip side, FrieslandCampina Wamco Nigeria Plc appreciated by 19 Kobo to N93.00 per share from N92.81 per share, Food Concepts Plc expanded by 15 Kobo to N2.87 per unit from N2.72 per unit, and Great Nigeria Insurance (GNI) Plc improved by 2 Kobo to 52 Kobo per share from 50 Kobo per share.
Yesterday, the volume of securities dipped by 91.8 per cent to 260.2 million units from 3.2 billion units, the value of securities went down by 98.1 per cent to N154.2 million from N8.3 billion, while the number of deals soared by 53.3 per cent to 46 deals from 30 deals.
GNI Plc was the most active stock by value on a year-to-date basis with 3.4 billion units worth N8.4 billion, followed by CSCS Plc with 56.9 million units valued at N3.9 billion, and Okitipupa Plc with 27.5 million units traded for N1.8 billion.
The most traded stock by volume on a year-to-date basis was also GNI Plc with 3.4 billion units sold for N8.2 billion, trailed by Resourcery Plc with 1.1 billion units exchanged for N415.7 million, and Infrastructure Guarantee Credit Plc with 400 million units transacted for N1.2 billion.
By Adedapo Adesanya
The Naira dropped N2.09 or 0.15 per cent against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Thursday, April 2, to trade at N1,380.79/$1 compared with Wednesday’s rate of N1,378.70/$1.
However, it appreciated against the Pound Sterling in the official market by N2.77 to quote at N1,824.86/£1 versus the N1,836.57/£1 it was traded at midweek, and improved its value against the Euro by N10.54 to N1,591.92/€1 from N1,602.46/€1.
Yesterday was the last trading session of the week for the local currency in the spot market, as the market will be closed on Friday and Monday for the Easter Holiday.
At the black market, the Nigerian Naira maintained stability against the greenback yesterday at N1,405/$1, but gained N8 at the GTBank FX counter to settle at N1,388/$1, in contrast to the previous session’s N1,396/$1.
Pressure eased on the domestic currency as strong policy indicators have helped calm the majority of worries within the financial systems. Particularly in the remittance segment, the apex bank has directed all International Money Transfer Operators (IMTOs) to route remittance transactions through designated Naira settlement accounts in banks, a move aimed at boosting transparency and channelling more foreign exchange into the formal market.
This helps take off pressure from the foreign reserves, which have fallen below the $50 billion mark as they are gradually decreasing rather than falling sharply.
Meanwhile, the cryptocurrency market was bullish on Thursday, as macro sentiment shifted against recent optimism after reports that Iran is drafting a protocol with Oman to manage traffic through the Strait of Hormuz, easing concerns about disruptions to a key global oil route.
The remarks came after U.S. President Trump on Wednesday night vowed to hit Iran “extremely hard” in the coming weeks and that the Strait of Hormuz would “open naturally” once the war ends.
Cardano (ADA) chalked up 1.9 per cent to trade at $0.2435, Dogecoin (DOGE) grew by 1.2 per cent to $0.0912, Ethereum (ETH) appreciated by 0.8 per cent to $2,066.37, Bitcoin (BTC) added 0.5 per cent to sell at $67,080.53, Solana (SOL) increased by 0.5 per cent to $79.91, and Ripple (XRP) jumped 0.2 per cent to $1.31.
Conversely, Binance Coin (BNB) dipped 0.7 per cent to $586.90, and TRON (TRX) depreciated by 0.3 per cent to $0.3147, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 each.
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