TIRANA, July 18 – Albanians invested about $1 million in online trading in international stock exchanges in 2015 when several unlicensed operators emerged, triggering concern by the country’s highest financial authorities.
An annual report by the Financial Supervisory Authority shows there were 250 investors who invested about $1 million in 2015 in two operators licensed by the supervisory authority as agents of foreign brokers. More could have invested in unlicensed operators but no information is available about that.
U.S.-owned Aksioner International Securities Brokerage Sh.A and Stock International Albania Sh.A, which operates as a subsidiary of Cyprus-based “Lead Capital Markets”Ltd, are the only two operators licensed by the supervisory authority. A third operator, Platinium Investment, established in mid-2012 as an Albanian-owned enterprise, has been licensed by the central bank as a non-bank financial institution.
Online trading platforms offer investors opportunities to invest in financial products in international stock exchanges, mainly in government securities, foreign exchange and commodity products such as oil and precious metals.
Enkeleda Shehi, the director of the Financial Supervisory Authority, says the watchdog is focusing on transparency and raising awareness on these new risky investment opportunities.
“Investment through online trading platforms is a novelty in the Albanian market. Considering the risk investment in these platforms poses, the Authority has focused on the regulation of the activity of these operators promoting online platform products by paying attention to transparency and raising public awareness to address licensed operators,” Enkeleda Shehi told the parliamentary economy committee introducing an annual report.
In early January, the country’s highest financial authorities warned Albanians to be careful with online trading in international stock exchanges, describing such investments as highly risky, especially if offered by unlicensed operators and used by investors lacking appropriate knowledge.
“Unlicensed and unsupervised activities expose investors to hidden costs and other obligations, which in the case of lack of transparency by the intermediary operator could even be higher,” said country’s Financial Stability Advisory Group which includes the country’s central bank governor, the finance minister, the head of the Financial Supervisory Authority and the director of the Deposit Insurance Agency.
Potential investors are being lured by online brokers through phone calls and aggressive marketing campaigns at a time when only three brokers have been licensed by the Financial Supervisory Authority and the Bank of Albania to offer such services.
Rising interest to investment in online platforms comes at a time when interest to invest in traditional bank deposits has waned due to interest rates dropping below 1 percent and the emerging investment funds facing a slowdown due to a sharp drop in bond yields as the key interest rate has been cut to a historic low of 1.25 percent.
