THE listing of the First Mutual Wealth Gold Exchange Traded Fund on the Victoria Falls Stock Exchange is a strategic milestone for capital markets, given the crucial role of innovative investment products in deepening financial inclusion, attracting capital and advancing the objectives of the National Development Strategy 2, a senior Treasury official said.
In a speech he delivered at the ETF’s listing ceremony on Friday, Finance, Economic Development and Investment Promotion Deputy Minister, Kudakwashe Mnangagwa, said that the development sends a strategic signal to both local and international investors that Zimbabwe’s financial markets are evolving and becoming increasingly sophisticated.
“The listing strengthens the Victoria Falls International Financial Centre initiative, which leverages hard currency trading and unrestricted capital repatriation to attract regional investment. By connecting local savings to highly liquid JSE assets, the fund provides a safety valve for liquidity,” he said.
The First Mutual Wealth (FMW) Gold ETF began trading on the VFEX on Monday and delivered an impressive debut performance, with the counter surging nearly 40 percent during its first trading session.
The ETF opened at an issue price of 10 US cents before closing the day at 13,94 US cents, reflecting strong investor appetite for the gold-linked investment vehicle.
Market statistics released after the session showed that 357 257 units exchanged hands on the opening day, underlining heightened interest in alternative investment products as the VFEX seeks to broaden its offerings beyond traditional equities and real estate investment trusts.
During the subscription phase, retail investors contributed more than 60 percent of total subscriptions, significantly exceeding the VFEX’s initial public spread target of 30 percent.
VFEX chairperson Florence Jambwa said the successful retail uptake marked a defining moment for Zimbabwe’s financial markets and demonstrated the increasing accessibility of investment products through digital platforms.
“The growth of retail participation remains one of our strategic priorities as a market,” she said.
She added that the VFEX Direct digital platform played a critical role in enabling wider participation by ordinary investors and would continue to provide accessibility as trading in the ETF progresses.
The fund, managed by First Mutual Wealth, offers investors exposure to international gold-related assets through a regulated offshore-linked structure. Its investment model tracks gold-focused assets primarily listed on the Johannesburg Stock Exchange (JSE), allowing local investors to benefit from global bullion performance without the operational burden and security risks associated with holding physical gold.
According to FMW general manager Mr Thomas Mutswiti, the structure combines both stability and diversification.
He said half of the portfolio is invested in the 1nvest Gold ETF, which is backed by physical gold reserves held in South Africa and the United Kingdom, while the remaining allocation is spread across major gold mining companies, including Gold Fields, AngloGold Ashanti, Harmony Gold and DRDGold.
“The structure gives investors transparent and diversified exposure to the gold sector through a regulated investment framework,” Mutswiti said.
He noted that the ETF was deliberately structured to remain accessible to ordinary investors, with a minimum investment threshold of just US$100.
The hybrid design of the fund also enables it to distribute dividends generated by the underlying mining companies every two quarters, creating a broader total-return profile for investors even during periods when international gold prices remain relatively stable.
For institutional investors such as pension funds and asset managers, the ETF is also expected to provide a simplified route to offshore exposure while remaining compliant with domestic regulatory requirements.
Under current Insurance and Pensions Commission (IPEC) regulations, pension funds are permitted to allocate up to 15 percent of their assets to foreign investments.
Mr Douglas Hoto, chief executive officer of First Mutual Holdings Limited, said the new product could help address the long-standing challenge of short-termism within Zimbabwe’s capital markets.
“We cannot build sustainable housing and infrastructure financing systems without developing credible long-term investment instruments,” Hoto said.
He said the listing also strengthens the broader Victoria Falls International Financial Centre initiative, which seeks to position the VFEX as a competitive regional financial hub through hard currency trading and unrestricted capital repatriation.
“By linking local investors to highly liquid JSE-listed gold assets, the ETF introduces an additional layer of liquidity support to the local market. In the event of thin local demand, the underlying South African assets can be traded to facilitate settlement obligations on the VFEX,” said Mr Hoto.
The FMW Gold ETF becomes the third new financial instrument introduced on the VFEX this year, reinforcing the exchange’s ambitions to diversify Zimbabwe’s capital markets and deepen investor participation across both institutional and retail segments.-herald
