Download Investment Case - Global X Funds

NGE
MSCI Nigeria ETF
The Global X MSCI Nigeria ETF seeks
to provide investment results that
correspond generally to the price and
yield performance, before fees and
expenses, of the MSCI All Nigeria Select
25/50 Index.
AFRICA’S LARGEST ECONOMY
In addition to being the largest country in Africa by population and
GDP, Nigeria is also the biggest oil producer in the continent and
continues to grow its regional influence. The Global X MSCI Nigeria
ETF (NGE) provides exposure to the largest and most liquid companies
in Nigeria, giving investors a cost-efficient way to access a country with
long-term growth potential.
•
“ Next 11” Country – Goldman Sachs has included Nigeria in its
“Next 11” economies, which are defined as a group of potentially
large, fast-growing markets that are expected to be an important
source of global economic growth and opportunity in the future.
(Goldman Sachs, 2007)
•
arge & Young Population – In addition to being the 7th most
L
populous country in the world and the most populous country in
Africa with over 186 million people, approximately 62% of Nigeria’s
population is under the age of 25 (US Census Bureau, 2016).
600 LEXINGTON AVE
20TH FL
NEW YORK, NY 10022
1 (888) GX-FUND-1
GLOBALXFUNDS.COM
@GLOBALXFUNDS
NGE
MSCI Nigeria ETF
THE CASE
The Global X MSCI Nigeria ETF invests in among some of the largest and most
liquid companies in Nigeria.
FRONTIER MARKET GROWTH POTENTIAL
As a frontier market, Nigeria has a less developed economy and faces
social, political and economic risks as well as security concerns that
more developed countries may not. However, a young population and
a strong push toward economic liberalization could set the stage for
a growing middle class and the potential to achieve the next leg up in
economic development.
Nigeria Favorable Growth Demographics (Comparison vs. U.S.)
Source: U.S. Census Bureau, 2014
U.S.A.
Nigeria
AGE
100+
95-99
90-94
85-89
80-84
75-79
70-74
65-69
60-64
55-59
50-54
45-49
40-44
35-39
30-34
25-29
20-24
15-19
10-14
5-9
0-4
30
25
20
15
10
5
0
0
5
10
15
20
25
•
merging Middle Class: Nigeria’s middle class stands at 4.1 million
E
households and makes up 11% of the country’s population. The
middle class households in Nigeria are set to rise from around 10
million in 2015 to nearly 15 million in 2030, making them the world’s
second fastest-growing middle class. (Standard Bank, Africa 2014 and
Euromonitor, 2015)
•
Pro-Market Reforms: Building on the success of privatization of
telecom in 2002 and power in 2013, the Nigerian Government is
now turning its focus towards infrastructure development by bring
the Ministries of Work, Power and Housing under one leadership.
These ministries are allocated about 24% of the 2016 budget. The
government is also focusing on power sector and towards passing
the petroleum industry bill which will draw foreign investments in the
industry. (Proshare, 2015)
•
Investments: Nigeria was among the top five destinations for FDI in
Africa in 2014, achieving FDI inflows of $4.7 billion. In 2015, Nigeria
witnessed peaceful elections, signaling signs of political stability within
the country. This, in combination with the newly elected President’s
commitment towards increasing security and reducing corruption, is
expected to attract new investment into the region. 14 new European
firms are expected to enter Nigeria in the second half of 2015, with
planned investments in real estate, construction, mining, agriculture
etc. (UNCTAD 2015, Vanguard 2015, Guardian 2015)
30
Population (in millions)
Nigeria GDP Per Capita (PPP)¹
Source: World Bank, 2014
$7,000
6,000
5,000
4,000
3,000
2,000
1,000
0
1990
1993
1996
1999
2002
2005
2008
2011
2014
¹ Per capita GDP measured by PPP (Purchasing Power Parity) using current international
dollars. A current international dollar has the same purchasing power over GDP as a US$ has
in the United States
600 LEXINGTON AVE
20TH FL
NEW YORK, NY 10022
1 (888) GX-FUND-1
GLOBALXFUNDS.COM
@GLOBALXFUNDS
NGE
MSCI Nigeria ETF
Investing involves risk, including the possible loss of principal. International investing may involve risk of capital loss from unfavorable fluctuations in currency values, from differences
in generally accepted accounting principles, or from economic or political instability in other nations. Emerging markets involve heightened risks related to the same factors as well as
increased volatility and lower trading volume. Investments focusing on a single country may be subject to higher volatility. The fund is non-diversified. Investment in African securities
involves heightened risks, including expropriation and/or nationalization of assets, confiscatory taxation, political instability, including authoritarian and/or military involvement in
governmental decision-making, armed conflict, the impact on the economy as a result of civil war, and social instability as a result of religious, ethnic and/or socioeconomic unrest and, in
certain countries, genocidal warfare. The economic development of Nigeria has been significantly hindered by military rule, mismanagement, corruption and ethnic conflict. The Nigerian
economy is heavily dependent on oil, and the industry makes up a significant portion of Nigeria’s GDP. The oil industry is cyclical and highly dependent on the market price of oil.
Shares are bought and sold at market price (not NAV) and are not individually redeemed from the Fund. Brokerage commissions will reduce returns.
Carefully consider the Funds’ investment objectives, risk factors, charges and expenses before investing. This and additional information can
be found in the Funds’ prospectus, which may be obtained by calling 1-888-GX-FUND-1 (1.888.493.8631), or by visiting www.globalxfunds.com.
Read the prospectus carefully before investing.
Global X Management Company, LLC serves as an advisor to the Global X Funds. The Funds are distributed by SEI Investments Distribution Co., One Freedom Valley Drive, Oaks, PA,
19456, which is not affiliated with Global X Management Company or any of its affiliates. Solactive Indexes have been licensed by Structured Solutions AG for use by Global X Management
Company, LLC. Global X Funds are not sponsored, endorsed, issued, sold, or promoted by Structured Solutions AG, nor does this company make any representations regarding the
advisability of investing
in the Global X Funds.
600 LEXINGTON AVE
20TH FL
NEW YORK, NY 10022
1 (888) GX-FUND-1
GLOBALXFUNDS.COM
@GLOBALXFUNDS