The Nairobi Securities Exchange is developing an exchange-traded fund focused on artificial intelligence stocks, in what the bourse says would be the first product of its kind in East Africa.
NSE chief executive Frank Mwiti told Reuters that the exchange is targeting a launch before the end of 2026 as it seeks to broaden the range of investment products available to Kenyan investors and respond to growing demand for technology exposure.
NSE looks beyond traditional sectors
Kenya’s listed equity market remains concentrated in banking, telecommunications, consumer businesses and other established sectors. The proposed ETF would offer local investors a route into a thematic technology product without requiring them to open offshore brokerage accounts.
Exchange-traded funds pool securities into a tradable product that can be bought and sold on an exchange like a conventional share. For investors, they can provide diversified exposure to a sector or investment theme without requiring direct ownership of every underlying security.
The AI-focused product would therefore mark a notable expansion in the range of investment themes available through East African public markets if it reaches launch.
Growing demand for technology exposure
Mwiti said younger Kenyan investors are increasingly looking for exposure to technology companies and global growth sectors. At present, much of that demand is met through overseas investment platforms because the domestic market has relatively limited direct exposure to major global technology companies.
The proposed ETF is intended to close part of that gap by giving local investors access to a portfolio linked to artificial-intelligence businesses and related companies.
The final composition of the fund will depend on the product structure, index methodology and regulatory approvals. References to high-profile AI companies should therefore not be interpreted as confirmation that any particular private company will be directly held by the ETF.
African exchanges broaden product offerings
The NSE initiative comes as African exchanges look for new products that can attract retail investors, deepen liquidity and connect domestic capital markets to global investment themes.
South Africa’s Johannesburg Stock Exchange has already listed an AI-focused actively managed ETF, providing a regional example of how technology themes are being packaged for public-market investors on the continent.
For Kenya, the planned product would add to wider efforts to modernise the securities market and encourage more participation from younger investors.
Sources
- Reuters interview with Nairobi Securities Exchange CEO Frank Mwiti on the planned AI-focused ETF
- Johannesburg Stock Exchange official information on listed exchange-traded products
- Nairobi Securities Exchange official website
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