ASHON Sounds Alarm: ‘Rally With Responsibility’ as NGX Soars
The Association of Securities Dealing Houses of Nigeria (ASHON) has urged investors and regulators to exercise caution amid the ongoing bullish run in Nigeria’s capital market, warning that unchecked speculation could destabilize the system.
Here’s a detailed breakdown of the development:
1. Why ASHON Is Raising Concern
• Nigeria’s stock market is currently experiencing a sustained rally.
• The surge has triggered strong investor enthusiasm and increased participation.
• However, ASHON warns that:
• Some stocks are recording sharp price gains
• These increases are not always backed by strong earnings or governance fundamentals
• Speculative trading could overheat the market
The association stressed that market optimism must be anchored on real economic performance.
2. NGX Also Issues Caution
The rally is unfolding on the Nigerian Exchange Limited (NGX), which has also advised investors to remain cautious.
NGX urged market participants to:
• Focus on companies with strong fundamentals
• Avoid speculative or momentum-driven trading
• Conduct due diligence before investing
3. Suspension Highlights Market Risks
ASHON pointed to the recent suspension of Zichis Agro-Allied Limited by NGX over irregular trading activity.
According to the association:
• The suspension demonstrates regulatory vigilance.
• It reinforces the importance of maintaining orderly and transparent markets.
• Decisive intervention helps protect investors and preserve confidence.
4. What’s Driving the Rally?
Despite the warning, ASHON acknowledged positive underlying factors fueling the market upswing:
• Renewed investor confidence
• Improved macroeconomic sentiment
• Broader participation across asset classes
The association welcomed the rally but emphasized that sustainability is key.
5. Lessons from the Past
ASHON cautioned against a repeat of the 2008–2009 stock market crash, where excessive speculation and weak fundamentals led to severe losses.
The message:
Growth must be supported by corporate earnings, governance standards, and economic indicators — not hype.
6. Calls to Regulators and Listed Companies
ASHON urged:
Regulators (including RegCo) to:
• Strengthen market surveillance
• Enforce compliance rules
• Clamp down on irregular trading
Listed companies to:
• Comply with free float requirements
• Improve corporate governance standards
The association also encouraged efforts to attract new listings to:
• Deepen liquidity
• Broaden investment opportunities
• Strengthen market resilience
7. Commitment to Stability
ASHON reaffirmed its dedication to:
• Professionalism
• Ethical market conduct
• Investor protection
• Sustainable capital market growth
It concluded that optimism must be balanced with responsibility to ensure a stable market capable of supporting Nigeria’s broader economic development.
The Bigger Picture
Nigeria’s stock market rally reflects growing confidence — but ASHON’s warning signals that discipline and fundamentals must guide investment decisions.
The key takeaway:
A strong rally is positive — but only when supported by strong fundamentals.
The Association of Securities Dealing Houses of Nigeria (ASHON) has urged investors and regulators to exercise caution amid the ongoing bullish run in Nigeria’s capital market, warning that unchecked speculation could destabilize the system.
Here’s a detailed breakdown of the development:
1. Why ASHON Is Raising Concern
• Nigeria’s stock market is currently experiencing a sustained rally.
• The surge has triggered strong investor enthusiasm and increased participation.
• However, ASHON warns that:
• Some stocks are recording sharp price gains
• These increases are not always backed by strong earnings or governance fundamentals
• Speculative trading could overheat the market
The association stressed that market optimism must be anchored on real economic performance.
2. NGX Also Issues Caution
The rally is unfolding on the Nigerian Exchange Limited (NGX), which has also advised investors to remain cautious.
NGX urged market participants to:
• Focus on companies with strong fundamentals
• Avoid speculative or momentum-driven trading
• Conduct due diligence before investing
3. Suspension Highlights Market Risks
ASHON pointed to the recent suspension of Zichis Agro-Allied Limited by NGX over irregular trading activity.
According to the association:
• The suspension demonstrates regulatory vigilance.
• It reinforces the importance of maintaining orderly and transparent markets.
• Decisive intervention helps protect investors and preserve confidence.
4. What’s Driving the Rally?
Despite the warning, ASHON acknowledged positive underlying factors fueling the market upswing:
• Renewed investor confidence
• Improved macroeconomic sentiment
• Broader participation across asset classes
The association welcomed the rally but emphasized that sustainability is key.
5. Lessons from the Past
ASHON cautioned against a repeat of the 2008–2009 stock market crash, where excessive speculation and weak fundamentals led to severe losses.
The message:
Growth must be supported by corporate earnings, governance standards, and economic indicators — not hype.
6. Calls to Regulators and Listed Companies
ASHON urged:
Regulators (including RegCo) to:
• Strengthen market surveillance
• Enforce compliance rules
• Clamp down on irregular trading
Listed companies to:
• Comply with free float requirements
• Improve corporate governance standards
The association also encouraged efforts to attract new listings to:
• Deepen liquidity
• Broaden investment opportunities
• Strengthen market resilience
7. Commitment to Stability
ASHON reaffirmed its dedication to:
• Professionalism
• Ethical market conduct
• Investor protection
• Sustainable capital market growth
It concluded that optimism must be balanced with responsibility to ensure a stable market capable of supporting Nigeria’s broader economic development.
The Bigger Picture
Nigeria’s stock market rally reflects growing confidence — but ASHON’s warning signals that discipline and fundamentals must guide investment decisions.
The key takeaway:
A strong rally is positive — but only when supported by strong fundamentals.