Although not yet popular investment instruments in Nigeria, some Exchange-Traded Funds (ETFs) emerged as standout asset classes in 2024. Some ETFs delivered impressive returns, with 8 of the 12 ETFs listed on the Nigerian Exchange outperforming inflation figures.
Exchange-Traded Funds (ETFs) are investment vehicles that bundle a collection of assets—such as stocks, bonds, or commodities—into a single package. They provide investors with an efficient way to gain exposure to multiple assets simultaneously.
For instance, rather than purchasing individual shares of all the companies listed on the NGX 30 Index, investors can opt for the Greenwich Alpha ETF, which mirrors the performance of the NGX 30, offering a simplified and diversified investment option.
Investors who tapped into these funds gained the advantage of diversified exposure across equities, fixed income, and commodities. Notably, the NewGold ETF, which tracks the gold spot price in South African Rand, delivered exceptional performance, returning 180 percent during the year. However, not all ETFs delivered positive results, as some underperformed in line with broader market challenges. The Greenwich Alpha ETF, which tracks the NGX 30 Index, was among the laggards, recording a significant negative return of 56 percent.
Here is a breakdown of 2024’s best returning ETFs
1. Meristem Growth ETF – 903%
Meristem Growth ETF had the highest return in 2024, with a 903 percent, with its unit price moving from N39.33 at the start of the year to N394. The ETF features all the constituent stocks which are tracked by the NGX Meristem Growth Index. In 2024, the NGX Meristem Growth Index appreciated by 43 percent.
The constituents of the NGX Meristem Growth Index were some of the best performing stocks, as well as some of the worst-performing stocks. For example, Conoil appreciated by 362 percent, while Okomu Oil gained 71 percent. United Capital was a significant contributor to the index.
2. Meristem Value ETF – 503%
The Meristem Value ETF delivered an impressive 503% return in 2024, with its unit price surging from N33.18 at the beginning of the year to N200 by year-end. The ETF comprises equities included in the NGX Meristem Value Index, reflecting the strong performance of its underlying assets
The NGX Meristem Value Index appreciated by 100 percent in 2024, with Julius Berger Nigeria, TotalEnergies, Lafarge Africa, Seplat Energy, and UACN driving the index’s bullish performance.
3. Newgold ETF – 180%
The Newgold ETF returned 180 percent in 2024, moving from N14,999 per unit to N41,999 during the year. The ETF which tracks gold’s spot price in South African Rand listed on the NGX closed the year with a N2.24 billion market capitalization at the year’s end. During the year, the ETF reached a year-high price of N118,000.
4. The SIAML Pension ETF 40 – 60%
The SIAML Pension ETF 40, which is managed by the Stanbic IBTC Asset Management, invests in the equities tracked by the NGX Pension Index. The ETF recorded a 60% appreciation in 2024, with its unit price rising from N500 at the start of the year to N799.99 by year-end.
The ETF has 40 constituent stocks, with the largest constituents being Transcorp, International Breweries, UBA, Sterling Holdco, and Zenith Bank.
5. Vetiva Industrial ETF – 58%
Vetiva Industrial ETF which is managed by Vetiva Fund Managers, is a basket of all the constituent equities of the NGX Industrial Index. The ETF’s unit price moved from N26.5 to N41.85 during the year, as the NGX Industrial Index appreciated by 32 percent during the year.
6. Vetiva Consumer Goods ETF – 51%
Vetiva Consumer Goods ETF returned 51 percent in 2024, as its price appreciated from N11.38 to N17.2 during the year. The ETF pools together the constituent stocks of the NGX Consumer Goods Index, and the stocks include, BUA Foods, Cadbury Nigeria, Champion Breweries, Dangote Sugar, Guinness Nigeria, Honeywell Flour Mills, International Breweries, NASCON, Nigerian Breweries, Nestle Nigeria, Northern Nigeria Flour Mills, PZ Cussons, Unilever, and Vitafoam.
7. Vetiva Griffin 30 ETF – 39%
The Vetiva Griffin 30 ETF returned 39 percent in 2024, moving from N27 to N37.6 during the year. Vetiva Griffin 30 ETF tracks the performance of the constituent stocks of the NGX 30 Index. The NGX 30 Index appreciated by 39 percent during the year.
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