Nairobi Securities Exchange (NSE) has announced the listing of Barclays Bank of Kenya #ticker:BBK single-stock futures to its derivatives market, NEXT.
The futures trading for the Barclays stock transitioning to ABSA Kenya is expected to offer a hedging ground for its share price at the NSE board, where it has been trading between Sh10.05 to Sh13.85 this year.
On December 19, the share price closed at Sh13.05, a top mover at the market with 221,000 traded shares.
Barclays Bank will be the sixth single stock listed at NEXT in addition to the existing Safaricom #ticker:SCOM, KCB Group #ticker:KCB, Equity Bank #ticker:EQTY, KenGen #ticker:KEGN and East African Breweries Ltd (EABL) #ticker:EABL that listed on the launch of the market in July.
“Following a review of the NSE 25 share index constituent counters, and in accordance with the single stock future eligibility criteria, the exchange wishes to inform of the listing of Barclays Bank of Kenya Limited single-stock futures contracts,” said the NSE in a statement.
Investors will be required to pay an initial margin of Sh1,800 for one contract, giving them exposure to 1,000 Barclays Bank shares.
The stock will be available to trade from today, with a three-month expiry period.
The inclusion of the stock to the derivative market is set to increase liquidity at the stock trading, which has been on the downslide registering a drop to a six-year low at 2834 points for the NSE 20 Index towards end of year from high of 5,113 points in 2014.
In the first trading with contracts expiring in September, NSE announced that investors bought two single stock futures contract for Safaricom and EABL at Sh28,900 and Sh19,974 respectively.
As at December 19, the derivatives market recorded a turnover of 1,523,000 and 14 deals made.
NSE is currently offering single stock futures and equity index future as it awaits development for commodity derivatives for physical items like agricultural products.