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Frequently Asked Questions

General questions

Benefits of Investments I

There are several benefits to be derived from investing. The obvious benefit is the profits that accrue on an investment. For instance, when you invest in shares listed on the Ghana Stock Exchange, you can earn dividends and/or capital gains. Dividends are the portion of a company’s profits that are distributed to all shareholders during a particular financial year after they have been recommended by the directors and approved by shareholders. Capital gains refer to the difference in the price at which an investor buys shares and the price at which he sells them.

Benefits of Investments II

Another benefit of investing is that you protect your savings from the effects of inflation which can erode the value of your savings if not invested properly. Generally speaking, ¢10million in 2004 will buy less goods in 2009 than would have been possible in 2004.

Benefits of Investments III

Investing also helps you to prepare for projects in the future as well as retirement. Though you may not have the resources today to pursue your dream items such as acquiring immovable/movable assets (land, building, car etc.), regular investment can prepare you to realize these dreams in the future. Do not forget that a farmer can rather choose to consume his seed today or invest it in the soil to reap a harvest tomorrow. Choose to invest today for a better tomorrow.

Listed Companies

There are currently Thirty-seven(37) companies listed on the Ghana Stock Exchange representing some of the leading sectors in the Ghanaian economy. These sectors include financial, manufacturing, mining, trading, brewery, and pharmaceuticals.

There are four main product types on the GSE equities market, namely, ordinary shares, depository shares, preference shares, and Exchange Traded Funds.

Trading Arrangement

Only Registered Securities Dealers (brokers) can trade on the Ghana Stock Exchange. A Registered Securities Dealer is a broker who has been licensed by the Ghana Stock Exchange to trade on the Ghana Stock Exchange. Trading on the Ghana Stock Exchange takes place every working day of the week from 10.00 am to about 3.00 pm. Trading is open to all eligible investors both domestic and foreign.

How to open a securities account

A prospective investor on the Ghana Stock Exchange must open a securities account with a brokerage house prior to trading in securities. The process of opening an account is very simple and starts by contacting a broker of your choice. (Access our list of Licensed Dealing Members (Stockbrokers) here) The investor then completes an account opening form giving personal particulars, a passport picture and a National ID and contact address, etc.

Who is a Licensed Dealing Member (LDM)

These are companies incorporated under the Companies Act of Ghana 2019 (Act 992) and Licensed by the Securities and Exchange Commission and the Ghana Stock Exchange to sponsor and trade all securities. LDMs also have the right to provide financial advisory services to their clients.

A prospective LDM must first meet the operational and legal requirements of the GSE before being admitted into membership of the GSE. LDMs must also meet their continuous membership obligations in the market rules such as liquidity and capital requirement.

Licensed Dealing Members play a vital role on the market because all investments on the Ghana Stock Exchange can only be done through an LDM.

Who is a Registered Securities Dealer/Stockbroker

Registered Securities Dealers (RSDs) are persons authorized by the Ghana Stock Exchange to trade on the market on behalf of a Licensed Dealing Member (LDM).

A Registered Securities Dealer (RSD) or stockbroker is a professional who helps investors to either buy or sell securities (shares and bonds) on the Stock Exchange. The RSD, therefore, acts as the go-between or intermediary between investors who wish to buy and or sell their securities (shares/bonds, etc.). The RSD, therefore, eliminates the need for investors to search for trading partners. RSDs are licensed to give investment advice to investors and prospective investors.

To qualify as an RSD, a person must among other things complete the Securities Courses offered by the Ghana Investment Securities Institute and pass all the relevant examinations under the program. The person must also be in employment by a brokerage company for at least six months and be given a securities dealer license by the Securities and Exchange Commission. Finally, a prospective RSD must be given a license by the GSE authorizing him/ her to trade on the market.

What is OTC Market

OTC stands for “over the counter”. It is an alternative market provided by the GSE for trading in securities that are not listed on the Exchange. Securities tradable on the OTC include ordinary shares, preference shares, debt instruments, etc.

Protecting your investments on the Ghana Stock Exchange

Certain regulatory measures are in place to protect individuals who invest in securities on the Ghana Stock Exchange. The brokers who serve as intermediaries between investors and the Ghana Stock Exchange are required by the Ghana Stock Exchange to comply with membership regulations and the compliance manual of the SEC. The listed companies on the Ghana Stock Exchange are expected to observe market rules including disclosure of financial results and any other material and price sensitive information. The Securities Industry Act, 2016 (Act 929) regulates Ghana’s capital market. Under this law, a Securities & Exchange Commission (SEC) has been established to ensure that all players in the industry comply with the standards established for operating in the industry. Investors must keep themselves informed and contact their Licensed Dealing Members, the Ghana Stock Exchange, or the Securities & Exchange Commission if they have any serious complaints relating to their investments.

Securing your investment on the Ghana Stock Exchange

A Licensed Dealing Member (Stockbroker) within two business days must issue to the investor a contract note after completing a transaction for the investor. A contract note must indicate the volume of securities traded, the price, total consideration, and fees and commissions on the trade.

An investor in doubt about holdings at a brokerage firm may request his transaction statement from the Central Securities Depository Ghana Ltd. Investors must keep themselves informed and contact their Licensed Dealing Members, the Ghana Stock Exchange, or the Securities & Exchange Commission if they have any serious complaints relating to their investments.

Why you must monitor your investment

The business world is dynamic as there is always one change or the other taking place. For instance, there could be a change in the environment of a company in which you hold shares. The change could affect the fortunes of the company either positively or negatively. If you are monitoring your investment, you will be in a better position to either take advantage of the opportunity or cut your losses. You can know the right time to shift your investment from one listed company to another or when to buy/sell an investment only when you monitor your investment.

Company announcements and share prices

Listed companies are expected to inform the general public about any significant development in their operations as well as release quarterly and annual financial results to the public. Listed companies, therefore, make periodic announcements to the public such as changes in their board of directors, key staff appointments and resignations, mergers, and acquisitions, expansions of branch network/production floor, etc. These market releases help investors to be well informed about the activities and operations of the listed company.

Share Indicies

Indices are widely used to track the performance of stock markets. While the average indices are calculated, all investors can benefit from the information given by these indices. Indices such as the GSE Composite Index, Dow Jones, Nikkei, and FTSE are examples of stock market indices used in stock markets. In very simple terms, stock market indices track changes in the market value of the stock exchange and thus show the performance of the stock market. The Ghana Stock Exchange publishes two indices, namely the GSE Composite Index (GSE-CI) and the GSE Financial Stocks Index (GSE-FSI).

Monitoring your investments

An investment is not supposed to be done passively. It is important for an investor to actively follow or monitor his investment. Monitoring your investment involves keeping your eye on the developments within the company you invested in, the stock market and the economy as a whole. It is a “hands on” affair. Investors on the Ghana Stock Exchange, can monitor their investments by keeping active communication lines with their broker, by reading the business pages of the newspapers, listening or watching business news on local FM stations and on the TV.

Expectations and share price

Expectations of the market have an impact on prices. Expectation of the market refers to what the investing public envisages the future performance of the stock market and listed companies to be. Specifically, the investing public will be interested in earnings growth and payment of dividend by the listed companies. Investors will typically buy shares of those companies that are expected to record strong growth rates in their earning and pay good dividends. The reason is that most investors are looking for profitable companies to invest in. This makes expectations about earnings growth and dividend payment key drivers of a company’s share price.

The economy and share price

When an economy is prospering and doing well, the general level of income rises. This leads to an improvement in the disposable incomes of individuals. Demand for shares derives partly from the level of disposable income. All things being equal, the higher the ability of investors to buy shares, the higher the demand for shares and with it, the tendency for share prices to move up. The opposite is also true. When an economy is sluggish, the level of income and hence disposable income is affected negatively. Such a situation may lead investors to cut back their investments in shares. The resulting slump in demand for shares could lead to a fall in share prices.

Interest rates and share price

Generally, interest rates and share price move in opposite directions. A fall in interest rates on money market instruments like treasury, fixed deposits and call accounts make them less attractive in terms of the returns they yield. Investors typically react to such a fall by transferring their investments into the stock market. This can lead to an increase in demand for shares, which may trigger price increases. In the case of a rise in interest rates, the opposite occurs, all things being equal. Increases in lending rates can also have an indirect influence on share prices. Where the cost of loan capital of listed companies go up with a rise in lending rates and this could dampen net profits and hence share prices.

Minimum amount to invest on the Ghana Stock Exchange

The amount of money you need to invest on the Ghana Stock Exchange depends on the prices of shares you select. Shares are usually traded in units of 1 and above.

Investment time horizon

Investment time horizon refers to the period of time an investor is prepared to wait for his investment to mature. The investment time horizon is determined by the investor. For instance, Madam Adzo may have ¢10million today to invest and would want it back in four months while Mr. Kwame who has the same amount to invest may need the money back in 5years. In this case Madam Adzo has a short-term investment horizon while Mr. Kwame has a long-term investment horizon. Investments products typically have different maturities from short term to long term so knowing your investment time horizon will help you to select the right investment.

What determines share prices

Share prices are fundamentally determined by supply and demand. In stock market terminology, demand refers to bids and supply refers to offers. All other things remaining the same, the price of a share will go up if bids for the share exceed offers. Similarly, a share’s price is most likely to fall if offers exceed bids for it. Bids and offers normally change in response to changing expectations of the investing public. Other factors behind demand and supply that affect share prices are interest rates, expectations of the market, the economy, performance of the listed company, major news from the listed company and investor psychology.

Selecting investment on the Ghana Stock Exchange

A number of factors should be considered by an investor before selecting any security on the Ghana Stock Exchange. Sound investment is typically based on research. When an investor decides to invest in shares on the Ghana Stock Exchange, he must consider the past performance of companies, prevailing conditions in the sector in which the companies operate as well as the future outlook in terms of profit growth and dividend payment. An investor can obtain such research information either by contacting a stockbroker for advice and/or reading research reports produced by the stockbrokerage companies.

Who qualifies to invest on the Ghana Stock Exchange

Any individual who is 18 years or above can invest on the Ghana Stock Exchange. Such an individual must understand that investment on the Ghana Stock Exchange is long-term and that there are risks involved, especially during the short-term. Another qualification is to have an investment objective and a period of time in which you intend to retrieve one’s investment. Another requirement is the funds itself for the investment. Parents can invest in trust for their children. Institutions can also invest their pension and provident funds on the Ghana Stock Exchange so long as the regulations governing those funds permit such investments.

Who is an investor

An investor is anyone who decides to put part of his/her funds in an investment for future benefit. For example, Mr. Mensah who has decided to use 10% his monthly salary to buy shares can be described as an investor. An investor has some characteristics including an investment objective, a time horizon for his investment, an expectation of return and money to invest.

When can you start investing

The best time to start investing is NOW. Generally, the younger you are, the longer the time you have to invest.

What is an investment

Generally, every activity that is done today but yields profit at a later date can be described as an investment. Investment involves postponing your consumption today in order to put your savings to work. Investment can also be described as the bridge between having savings/surplus cash and reaping returns. In other words, investment has the potential to move the savings/surplus funds of one person/entity to another who needs or requires those funds

Education questions

Does the Exchange still run the securities courses?

No. An institution called Ghana Investment and Securities Institute has been set up to run the securities courses. Visit their website on

Listing questions

What is suspension of trading in the shares of a company?

Suspension of trading is where the buying and selling activity in the shares of a company is put on hold.

What is meant by suspension of listing status?

When a company’s listing status is suspended, it means trading in the shares of the company cannot take place and in addition dealers cannot sponsor any corporate actions of the company on the market.

Why will a company's listing status be suspended?

When the company fails to comply with the continuing listing obligations of the Exchange after reminders, the listing status could be suspended to elicit compliance and market discipline and ultimately, boost investor confidence in the market.

What is the difference between suspension of trading in the shares of a company and the suspension of listing status?

Shares of the firm are placed on hold during a suspension of trading, whilst during a suspension of listing status, shares cannot be traded and dealers are also not allowed to sponsor any corporate actions of the company.

What is the purpose of suspension of listing status?

The purpose is to elicit compliance from the company concerned and ultimately deepen public confidence in the market.

What is the rule supporting the suspension of listing status?

Rule 13 of the GSE’s Listing Rules spells out the conditions under which a company’s listing status could be suspended.

What is the process involved in the suspension of a listing?

The Exchange notifies the company in writing, gives an opportunity for the company to rectify the breach(es) and specifies a period of time within which the company must eliminate the grounds for the suspension of listing.

Where the Exchange has reasonable grounds to believe that it is not possible to eliminate the grounds for suspension of listing, the Exchange shall then issue an order to suspend the listing status of the company.

Can the suspension of a listing status of a company be lifted?

The suspension of lifting status of a company is lifted when the company rectifies all the breaches that led to the suspension

Does the suspension of trading and/or the suspension of listing status of a company have any effect on the prospective investor?

Yes, suspension of trading and/or suspension of listing status of companies have some effect on prospective investors.  During the period of suspension, an investor is unable to trade (buy or sell shares) in the company. On the other hand this force the company to provide the needed information to enable investors take appropriate and informed investment decisions.