Top-Performing ETFs in 2024: What You Need to Know
Exchange-Traded Funds (ETFs) gained significant traction in 2024, with eight out of twelve listed on the Nigerian Exchange delivering returns that surpassed inflation. Here’s a breakdown of the standout performers and their achievements:
What Are ETFs?
ETFs are investment instruments that pool multiple assets—like stocks, bonds, or commodities—into one package. They allow investors to diversify their portfolios efficiently. Instead of buying shares in all companies in the NGX 30 Index, for example, investors can opt for the Greenwich Alpha ETF, which mirrors the index’s performance.
Top-Performing ETFs in 2024
1. Meristem Growth ETF – 903%
• Return: 903%
• Unit Price: Rose from ₦39.33 to ₦394.
• Index Tracked: NGX Meristem Growth Index (appreciated by 43%).
• Key Contributors: Stocks like Conoil (+362%) and Okomu Oil (+71%).
2. Meristem Value ETF – 503%
• Return: 503%
• Unit Price: Climbed from ₦33.18 to ₦200.
• Index Tracked: NGX Meristem Value Index (gained 100%).
• Notable Stocks: Julius Berger, TotalEnergies, Lafarge Africa, Seplat Energy.
3. NewGold ETF – 180%
• Return: 180%
• Unit Price: Jumped from ₦14,999 to ₦41,999.
• Description: Tracks gold’s spot price in South African Rand.
• Market Capitalization: ₦2.24 billion at year-end.
4. SIAML Pension ETF 40 – 60%
• Return: 60%
• Unit Price: Increased from ₦500 to ₦799.99.
• Index Tracked: NGX Pension Index.
• Key Stocks: Transcorp, Zenith Bank, International Breweries.
5. Vetiva Industrial ETF – 58%
• Return: 58%
• Unit Price: Moved from ₦26.5 to ₦41.85.
• Index Tracked: NGX Industrial Index (gained 32%).
6. Vetiva Consumer Goods ETF – 51%
• Return: 51%
• Unit Price: Rose from ₦11.38 to ₦17.2.
• Constituent Stocks: BUA Foods, Guinness Nigeria, Dangote Sugar, Nestlé Nigeria.
7. Vetiva Griffin 30 ETF – 39%
• Return: 39%
• Unit Price: Increased from ₦27 to ₦37.6.
• Index Tracked: NGX 30 Index.
The Laggards
Not all ETFs thrived. For example, the Greenwich Alpha ETF, which tracks the NGX 30 Index, suffered a negative return of 56%, reflecting broader market challenges.
Why ETFs Are Gaining Attention
• Diversification: ETFs provide exposure to a broad range of assets.
• Accessibility: Investors can tap into different sectors with a single investment.
• Performance: With some ETFs outperforming inflation, they offer competitive alternatives to traditional investment options.
Conclusion
2024 was a transformative year for ETFs on the Nigerian Exchange, showcasing their potential as profitable investment vehicles. As ETFs gain popularity, investors are increasingly leveraging them for diversification and high returns. However, careful selection remains key to maximizing gains while mitigating risks.
Exchange-Traded Funds (ETFs) gained significant traction in 2024, with eight out of twelve listed on the Nigerian Exchange delivering returns that surpassed inflation. Here’s a breakdown of the standout performers and their achievements:
What Are ETFs?
ETFs are investment instruments that pool multiple assets—like stocks, bonds, or commodities—into one package. They allow investors to diversify their portfolios efficiently. Instead of buying shares in all companies in the NGX 30 Index, for example, investors can opt for the Greenwich Alpha ETF, which mirrors the index’s performance.
Top-Performing ETFs in 2024
1. Meristem Growth ETF – 903%
• Return: 903%
• Unit Price: Rose from ₦39.33 to ₦394.
• Index Tracked: NGX Meristem Growth Index (appreciated by 43%).
• Key Contributors: Stocks like Conoil (+362%) and Okomu Oil (+71%).
2. Meristem Value ETF – 503%
• Return: 503%
• Unit Price: Climbed from ₦33.18 to ₦200.
• Index Tracked: NGX Meristem Value Index (gained 100%).
• Notable Stocks: Julius Berger, TotalEnergies, Lafarge Africa, Seplat Energy.
3. NewGold ETF – 180%
• Return: 180%
• Unit Price: Jumped from ₦14,999 to ₦41,999.
• Description: Tracks gold’s spot price in South African Rand.
• Market Capitalization: ₦2.24 billion at year-end.
4. SIAML Pension ETF 40 – 60%
• Return: 60%
• Unit Price: Increased from ₦500 to ₦799.99.
• Index Tracked: NGX Pension Index.
• Key Stocks: Transcorp, Zenith Bank, International Breweries.
5. Vetiva Industrial ETF – 58%
• Return: 58%
• Unit Price: Moved from ₦26.5 to ₦41.85.
• Index Tracked: NGX Industrial Index (gained 32%).
6. Vetiva Consumer Goods ETF – 51%
• Return: 51%
• Unit Price: Rose from ₦11.38 to ₦17.2.
• Constituent Stocks: BUA Foods, Guinness Nigeria, Dangote Sugar, Nestlé Nigeria.
7. Vetiva Griffin 30 ETF – 39%
• Return: 39%
• Unit Price: Increased from ₦27 to ₦37.6.
• Index Tracked: NGX 30 Index.
The Laggards
Not all ETFs thrived. For example, the Greenwich Alpha ETF, which tracks the NGX 30 Index, suffered a negative return of 56%, reflecting broader market challenges.
Why ETFs Are Gaining Attention
• Diversification: ETFs provide exposure to a broad range of assets.
• Accessibility: Investors can tap into different sectors with a single investment.
• Performance: With some ETFs outperforming inflation, they offer competitive alternatives to traditional investment options.
Conclusion
2024 was a transformative year for ETFs on the Nigerian Exchange, showcasing their potential as profitable investment vehicles. As ETFs gain popularity, investors are increasingly leveraging them for diversification and high returns. However, careful selection remains key to maximizing gains while mitigating risks.