Ghana’s capital market regulator has raised concerns over a surge in unlicensed investment commentary on social media, as increased liquidity drives heightened activity on the Ghana Stock Exchange (GSE).
The caution follows observations by the Securities and Exchange Commission (SEC) that growing funds within the banking and asset management sectors are increasingly being channelled into equities, contributing to a recent uptick in market performance.
In a Facebook post, the Deputy Director-General of Operations at the SEC, Mr Mensah Thompson, said the current market momentum is being fuelled in part by excess liquidity within the financial system, as banks and institutional investors seek alternative avenues for returns.
“The Ghana Stock Exchange is booming and it’s booming for a number reasons. The performance of the Ghanaian economy has created a liquidity dilemma,” he said.
Mr Thompson explained that the build-up of liquidity among banks, trustees and asset managers had resulted in a significant portion of funds finding their way onto the stock market, prompting closer regulatory scrutiny.
“The SEC is keenly monitoring the situation and would intervene when necessary,” he stated.
Market data reflects this growing investor interest, with the GSE’s market capitalisation rising to GH¢243.85 billion last Thursday from GH¢241.72 billion the previous day, signalling sustained buying activity.
However, the regulator expressed concern about the parallel rise in online investment commentary, particularly from individuals without the required regulatory approval.
Mr Thompson warned that offering investment advice without a licence contravenes the Securities Industry Act, 2016 (Act 929), stressing that such conduct poses risks to retail investors who may rely on unverified guidance.
“Let me use this opportunity to remind all Ghanaians that Investment Advisory is a Licensed activity under the Securities Industries Act, Act 929,” he said.
“It is an offense to offer investment advise or run commentary that has the potential sway the behavior of investors without the requisite license,” he added.
He further cautioned that reliance on unlicensed advice could expose investors to avoidable financial losses, especially in a market environment characterised by heightened activity and speculation.
The SEC indicated that it is collaborating with the Cyber Security Authority to identify and take action against individuals and platforms engaged in unauthorised investment advisory activities across social media platforms such as TikTok, Facebook, X and Instagram.
“All persons on platforms such as the TikTok, Facebook, X, Instagram running such commentary must desist from it immediately,” Mr Thompson said.
The regulator’s intervention comes at a time when increased participation in the equities market is reshaping investment behaviour, raising both opportunities and risks for market participants.
Source:
www.graphic.com.gh
