Founded in 1960 as the Lagos Stock Exchange, the Nigeria Stock Exchange took on its present name in 1977 as by then the Stock Market already had branches in the most important business centers of the nation. Lagos however remained the headquarters of the Nigeria Stock Exchange.
Characteristically a self-regulatory organization, the transactions on the Nigeria Stock Exchange are also regulated by the Securities & Exchange
Commission (SEC). However the deregulation of the Nigerian Stock Exchange in 1993 has not only made it investor-friendly but at the same time more competitive.
The Nigeria Stock Exchange now has branches in the following cities:
Kaduna
Port Harcourt
Kano
Onitsha
Ibadan
Abuja
Yola
The Nigeria Stock Exchange began humbly with just nineteen companies enlisted on its rolls for trading. Now amongst the companies listed on the Nigeria Stock Exchange, nearly all are multinational companies constituting a cross-section of the economy. The number has rocketed up to 283 securities including:
11 Government Stocks
49 Industrial Loan Stocks, which may either be Debentures or Preference Stocks
194 Equity or Ordinary Shares of Companies.
That the Nigeria Stock Exchange functions efficiently is clearly visible through its high market capitalization which was very close to N5.9 trillion ($46 billion) in the first quarter of 2007.
The Nigeria Stock Exchange is assisted in its smooth running by an assortment of:
Houses that deal in Stockbrokerage
Issuing firms (Merchant Banks)
practicing Corporate Law Houses
Auditing and Accounting Houses
The Automated Trading System (ATS) is in place now and the days of the call over trading are a thing of the past.
The Central Securities Clearing System Limited (CSCS) is in charge of the clearing, settlement and delivery of transactions electronically on the Nigeria Stock Exchange making these processes more faster and effective.
The All-Share Index (AMI) is the stock market index of the Nigeria Stock Exchange which for its calculation uses only common stocks (ordinary shares), was developed in 1984.