Financial ExpertSpeak: Availability of real time data improves speed & accuracy of investment decisions
Caroline Mugadi, regional business lead of East Africa at Thomson Reuters spoke to AfricaMoney on the importance of the availability of real time data to the market. It not only facilitates greater transparency and accuracy in prices in the money/ financial/ foreign exchange markets, but also enables faster and more accurate decision making that meets future-oriented requirements. To attract further investment into Mauritius, information should be made available in a manner that is easily understood and acceptable in the financial market, our financial expert stated.
Edited excerpts from an exclusive interview:
With lack of data affecting the African people, how can having access to data across Africa help to drive the continent towards prosperity?
At the moment, a lot of foreign investors are interested in funding various sectors in Africa, for instance, the commodity sector and others, as well as seeking to defend the economic development of Africa. The role of data in all this is that it provides the interested parties in Africa with the necessary information that makes it easier and quicker for foreign investors to provide capital in those areas where there is a pressing need.
For example, we have seen that in East Africa there has been a new interest and discovery in the fields of energy, gas and oil. Because of the information made available, it has been possible for foreign investors to direct their resources in Tanzania, Uganda or Kenya, for instance. This means that the African continent can then enjoy resources they already possess at an earlier timeline because of the level of investment made in this sector.
Does availability of real time data boost financial activities as well in a country?
Yes, definitely, because when we have real time data available in the market it means that we have more transparency and more accuracy in prices that are available either in the money market or financial market or foreign exchange market. So, the quicker we are able to access to data, the faster we able to make investment decisions and the more accurately we are able to determine future requirements.
What enablers can be put in place to ensure access to data for the African people?
Definitely, one such enabler is technology. There have been a lot of developments in Africa – we have seen the expansion of the Nigerian economy to become the biggest economy in Africa, to name one outstanding development. Particularly, there is a lot happening in terms of economic activity and technology has been seen as the bridge that has enabled Africa to enjoy financial inclusion and therefore more real time information. Information is now available to the large corporate sector, small and medium enterprises, the government and individuals that technology brings together. Hence, technology-centric investments would help to ensure information dissemination in a clear and transparent manner.
For a country like Mauritius, how could better access to data help to boost the economy, specially the financial market?
Mauritius has taken a stand to become an international financial centre of global reckoning, and this means that it has able to attract a lot of investment. The investment portfolio of Mauritius has grown between 2014 to 2015 and now when we have a lot of investor interest and correspondingly, flow of investment into sectors of focus. This also means that the people of Mauritius need to know how they can benchmark in-country performance against international standard and how they can then make this information available in a manner that is easily understood and acceptable in the financial markets that attract investment into Mauritius.
Is there any tip to track the market better so as to be able to take right decision?
Within the financial market, most definitely, I would say availing solutions by Thomson Reuters. We have been in the market a long time and thus provide historical information that one can use to benchmark performance over a 25-40 year prior period. That would enable the financial market to benchmark and project more accurately what is to be done in the future. Other than that, there is information available in other sectors that would make it easier to take investment decisions concerning such sectors.
Finally, is there anything you would like to highlight regarding financial markets, economic data and foreign exchange movements?
The quicker one can get information, the quicker they are able to make investment decisions. Also, the more accurate information that one can get, the more accuracy it allows them in determining how they want to invest their capital or resources.
The kind of advice I would like to give to the Mauritian financial market is that we at Thomson Reuters have got the right tools. We have created a community globally, not just for Africa, that determines capital flows across different geographies. So, definitely, if anybody is looking to play in the financial markets and is eying access to financial and economic markets data, then they would need to look at the wide array of products and tools that Thomson Reuters offers to connect a wealth of like-minded people in a fast-paced and complicated market to enable them to remain connected and make robust financial decisions for themselves.
By Wazna Gunga