West African stock markets

I was recently chatting to a very wealthy British friend and I happened to mention the West African stock market based in Abidjan (BRVM). He didn’t realise such a thing existed. I suspect it’s not the easiest thing to access from overseas but locally it’s pretty straightforward – you set up an account with a local bank which has an investment arm, and then you go through them to purchase shares and bonds.

I started just after the recent crisis with admittedly small sums, but so far the investment looks good. With dividends reinvested and costs taken off – in the second half of 2011 my portfolio was up 17.8%, then 27.2% in 2012. Those don’t seem like bad returns to me especially given the stagnation of many markets around the world. You can track share prices online at the end of each day’s trade, and although the prices don’t seem too reactive to broader economic news, the trend so far is upwards. My bank’s brokers don’t seem particularly reactive – I’m not sure they’ve made a trade in the last five months, but anyway, I take a hands-off approach to the portfolio and I’m happy with the results.

I don’t think there’s much written about the market in English, so here’s my small contribution. Most of the companies are Ivorian, although Senegal’s telecom company Sonatel is by far the largest. For those wanting to invest in Africa’s strong economic growth rates but lacking the stomach for the high levels of risk around personal business projects, the stock market seems to represent a reasonably secure way to invest with a minimum of hassle. And with the CFA tied to the Euro, there is at least a greater degree of security with regards to currency fluctuations.

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