Dr. Ahmed Saad
Chairman of Middle East North Africa (MENA) IFIE
Regional Subcommittee, and Chief Advisor of the
Egyptian Financial Supervisory Authority (EFSA)
Regulator
Investor
Issuers
Capital Market
Clearing House
Custodian
Exchange
Brokers
Main source of Income : Transaction Cost
Investors
Individuals
Institutions
These are our target segment in the investors educational programs
Why Should We Educate them?
Informed and educated
investors are one of the key
drivers to the growth of
securities markets
Principles for investors education
1.
Investor education programs should be efficient,
effective and appropriate for their intended audience
2.
Investor education should be delivered to as broad an
audience as possible
3.
A comprehensive investor education program should
include investor protection services
4.
A comprehensive investor education program should
include measures to foster dialogue and cooperation
among providers of investor education
Best practices - Investor education programs
should be efficient, effective and appropriate
for their intended audience
 The content of investor education programs should be
appropriate for investor’s need
 Investor education programs should not be promotional
and impart specific skills
 Longer-term investor education programs imparting
more sophisticated understanding of financial products
and markets are encouraged
 Periodic assessments of investor education programs
should be carried out
Best practices-Investor education should be
delivered to as broad an audience as
possible
 Distributing investor education programs through
various channels
 Employing different learning strategies to enhance the
learning process
 Targeting specific audience
 Promoting diversity and innovation among investor
education providers
Best practices-A comprehensive investor
education program should include investor
protection services
 Provisions of investor alerts
 Provisions of information on intermediaries
Best practice-A comprehensive investor
education program should include
measures to foster dialogue and cooperation
among providers of investor education
 Informal
- Universities Circuits
- Press Conferences
 Formal
- EFSA
- Exchanges
Potential Partners
 Governmental agencies
 National and local exchanges
 Custodians
 Investors groups (NGO’s)
 Media outlets
Investor education Challenges
 Encouraging market participants to support educational
programs
 Lack of training courses that are tailored for individual
investors
 Variation of financial literacy among targeted audiences
(Market fragmentation)
 Channel of communication which will be most effective in
reaching targeted audiences
 Ensuring investor education is not confused with professional
advise
Developing a program
 Who are the targeted investors ?
 What are their levels of financial literacy?
 What should investors know?
 How do investors learn?
 What are the tools of communication?
 Investor education budget.
How to create a program?
A. Trained and competent staff
B. Tools and technology to assist staff
C. Various contact methods between investor and
provider
D. Database for recording and retrieving contacts
Role of regulator
• Assure that the securities markets are open,
fair, and honest.
• Require companies to disclose information
• Catch wrongdoers and impose punishment
ranging from fines to kicking them out of the
industry
Role of regulator in investor
education process
 Show investors how to research investments and
the people who sell them
 Make information about publicly traded
companies available to the public
 Answer questions and handle complaints
 Provide free educational materials
What tools do regulators use to
meet their investor audience?
Most rely heavily on the following:
 Brochures, leaflets
 The regulators own website
 On-line newsletters
 A presence at investor trade fairs
 Conferences
 Active use of the media (TV , radio, newspaper articles)
Conclusion
Successful Investor Education Programs lead to:
 Maximizing market active user’s base, broader investor pool.
 Markets gain depth and liquidity.
 Growth in businesses and jobs within market participants.
 Increase investors protection through knowledge.
 Regulators get tips on fraud.
 Guarantee more efficient capital allocation.
 Building more confidence in capital markets.
 Ease of new financial instruments and tools introduction to the markets.
As a major player in the market, CDS should
cooperate with other participants to assure
market growth by devoting time, efforts, and
financial support for investors education
programs
Thank You