[kictanet] Day 4 of 10:- eContent Requirements for Regulators

[Brian Longwe]

Hi Bill,

Thanks for this informative input.

Personally I think that the fault rests squarely with the Capital  
Markets Authority. It is their responsibility to ensure that the  
public are aware of the various ways in which they can interact with  
the market.

On a recently concluded trip to India a group of our stockbrokers  
found that in the deep, rural areas - many were familiar with trading  
via futures and derivatives; Prospectus for latest IPO were available  
next to tomatos and onions in kiosks; and villagers had been given  
simplified laptops in order to monitor, access and even trade in  
their portfolios. Upon enquiry the brokers were informed that the  
capital markets authority in India has already carried out 400  
seminars/workshops across all parts of India to inform people about  
the benefits of trading via the exchange market.

My question: besides colorful brochures what concrete actions are our  
regulators taking to ensure that every citizen is aware of their  
rights, privileges and what services are available to them.

Regards,

Brian

On Oct 15, 2007, at 11:54 AM, Bill Kagai wrote:

> On 10/15/07, John Walubengo <jwalu at yahoo.com> wrote:
>> keep thinking outside the box and contribute.
>
> In the spirit of thinking out of the box, you will see this conspiracy
> theory that is developing that when capital market regulators attempt
> to digitize the way of getting information through the internet and
> websites, users still don't understand the relevance. The lesson
> emerging is that regulators (CCK, CMA) etc need to support the
> business case on their websites to help businesses they have licensed
> grow.
>
> The extract below from today's Business Daily explains the attempted
> conspiracy theory which is a result of linkage breaking between
> regulators and the businesses they license.
>
> Vendors defend move to sell market data
> http://www.bdafrica.com/index.php? 
> option=com_content&task=view&id=3635&Itemid=5812
>
> October 15 2007: When the Nairobi Stock Exchange closed its auditorium
> on Monday apparently to  facilitate renovations, investors who
> normally follow trading from the room read mischief.
>
> They saw some uncanny coincidence between the closure and the
> licensing of six companies to sell market-generated information to
> investors.
>
> After the noise generated by the development died out, the users of
> the facility argued the closure was meant to create more business
> opportunities for the data vendors.
>
> Stung by the conspiracy theory, NSE chairman Jimnah Mbaru, rescinded
> the decision to lock out the investors, saying they would be
> accommodated even as the renovations went on.
>
> The concerns raised by the investors point to the low value placed on
> market information by the public, technocrats in the public service
> and some in corporate Kenya where the greatest source of information
> is word of mouth, probably because it is free.
>
> That explains why despite having an opportunity to pore through market
> statistics from the comfort of their desk tops by subscribing to a
> data vending service, investors will opt to be physically present at
> the bourse.
>
> Data vendors say there is a misconception of exactly what they do with
> many perceiving that they just sell raw data, which is distributed by
> the NSE for free and published in the print and electronic media on a
> daily and weekly basis.
>
> This perception has made investors not see why they should pay about
> Sh6,000 annually to use the proposed service, ensuring access to live
> stream as well as historical data.
>
> Data vending services are the latest phenomena in the Capital Markets
> with the six players having come on to the scene just three months ago
> after paying a licence fee of Sh170,000 (US $ 2500) to the NSE.
>
> Aly-Khan Satchu of Rich Management Limited, says data vending is
> "info-mediary", arguing that "the information is a valuable currency
> like the dollar which helps in better decision making."
>
> "It saves both time and money to the investor as previously they had
> to continuously check with their brokers on the goings on at the stock
> market," adds Robert Bitengo Maoga Chief Executive of Eight Limited,
> another data vendor.
>
> These benefits have, however, tended to be more discernible to people
> in far flung areas like Meru, Nakuru, Eldoret and Kisumu because the
> NSE is in Nairobi.
> There are, however, plans to expand to the regions through technology.
> Mr Bildad Kagai, the managing director of MediaCorp Limited said there
> was need for investor education on the need for interpretation of
> streamed data.
>
> Though many retail investors want live streaming of data and
> information, few neither understand it nor put it to use.
>
> "We have realised that potential clients are having a problem
> understanding the live data we stream," said Mr Kagai.
>
>  The live data has three main boards:  Normal, Prompt and Odd boards.
> An Investor can tell the number of shares of the listed companies
> being sold and what is  available for sale. Retail investors form the
> largest base of subscribers to the live data with an annual
> subscription of Sh6,000.
>
> Some corporate clients are interested in the research and historical
> data available in digitised form for an annual subscription of between
> Sh15, 000 and Sh20,000.
>
> But, Satchu said, the long term investor is not so much concerned with
> "the random walk of prices" which are the daily stock prices
> appearing on data vendors websites.
>
> "Our work is to digest the volumes of publicly available data in order
> to arrive at useful precise points to gauge a company by just browsing
> a page or two of accurate analysis," says Kagai.
>
> Nonetheless, investors say they pay the NSE Levy to get services
> including the live information displayed on the auditorium board.
> --
> Bildad Kagai
> MD - MediaCorp Limited
> Nairobi Stock Exchange [NSE] - Authorised Information Vendor
> Suite B2 Tetu Apartments StateHouse Avenue
> P. O. Box 20311-00200
> Tel. 254 20 272 8332
> Fax. Rendered Obsolete
> URL. www.mediacorpafrica.com
> --
>
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