Botswana investors can now buy exposure to some of the world’s biggest companies, including Nvidia, Apple, Microsoft, Amazon, Samsung, Tencent, Alibaba and Tesla, without opening offshore brokerage accounts.
The Botswana Stock Exchange (BSE) has widened access to international markets through the listing of three exchange-traded funds (ETFs), giving investors a new way to diversify beyond the traditional local mix of banks, property companies and other domestic counters.
The ETFs, which started trading on Thursday, allow investors to gain exposure to thousands of companies across global markets through a single transaction on the local bourse.
One fund tracks the S&P 500 Index, which represents some of the largest companies listed in the United States. Another follows the MSCI World Index, providing exposure to developed markets across North America, Europe and Asia, while the third tracks emerging markets dominated by economies such as Taiwan, South Korea, China and India.
For local investors, the listings remove some of the barriers that have historically limited direct access to international equities, including offshore account requirements and foreign currency transfers.
Rather than selecting individual overseas shares, investors can now buy diversified portfolios of global companies through funds linked to internationally recognised equity indices.
The S&P 500 ETF offers the most concentrated exposure, tracking about 500 of America’s largest listed companies, which collectively represent roughly 80 percent of the US equity market by market capitalisation.
The fund’s largest holdings include technology giants such as Nvidia, Apple, Amazon, Alphabet, Meta and Tesla, making it attractive to investors seeking exposure to the world’s largest technology-driven companies.
According to Satrix fund fact sheets reviewed by The Business Weekly & Review, the S&P 500 ETF delivered an average annual return of about 14.15 percent in US dollar terms over the past five years, translating to approximately 18.97 percent in pula terms.
The MSCI World ETF provides broader exposure by investing in large companies across 23 developed economies.
Although the United States makes up almost 73 percent of the fund, it also includes companies from Japan, the United Kingdom, Canada, France, Germany and Australia.
Technology companies account for the largest portion of the portfolio, alongside financial services, industrial and consumer companies.
The MSCI World Index generated average annual returns of about 12% in US dollar terms over the past five years, equivalent to about 18.4% in pula terms.
The third offering, the MSCI Emerging Markets ETF, provides exposure to developing economies across 24 countries, with major allocations to Taiwan, South Korea, China and India.
Its largest holdings include Taiwan Semiconductor Manufacturing Company, Samsung Electronics, Tencent and Alibaba.
Unlike the other two funds, the emerging markets ETF also provides exposure to medium-sized and smaller companies, allowing investors to participate in growth markets beyond the largest global corporations.
The MSCI Emerging Markets Index returned an average of about 7.5 percent annually in US dollar terms over the past five years, translating to roughly 13.7 percent in pula terms.
The BSE said the ETFs provide both retail and institutional investors with a convenient way to access international markets while retaining the ability to buy and sell the funds locally in pula through the domestic exchange.
The listings mark a significant expansion of investment options available to Botswana investors and represent a shift towards greater integration with global financial markets.
