The Nairobi Securities Exchange (NSE) has announced new NSE Trading Rules that will change how investors trade shares in Kenya. Effective August 1, 2025, the NSE has eliminated the requirement that shares be traded in minimum lots of 100, a rule that has been in place for decades. The revised NSE Equity Trading Rules will now allow the trading of shares in multiples of a single unit. This decision, approved by the Capital Markets Authority (CMA), also discontinues the NSE Odd Lot Board, which has handled odd-lot trades, transactions involving fewer than 100 shares, since the exchange was automated in 2006.
The Nairobi Securities Exchange, established in 1954, is one of East Africa’s key financial market institutions, offering equities, bonds, exchange-traded funds (ETFs), and real estate investment trusts (REITs). The historical 100-share minimum trading rule on the main board was designed to ensure liquidity and ease of trading. However, this threshold presented a barrier to many retail investors. For example, with Safaricom shares priced between KSh 20–30, buying the minimum lot required an investment of around KSh 2,000 and KSh 3,000, plus transaction fees. This excluded many low-income and first-time investors from participating in Kenya’s stock market.
The Odd Lot Board was introduced in 2006 to address this by allowing trades of fewer than 100 shares. However, it had limitations. Investors could only place limit orders, not market orders, and odd-lot trades were not allowed during the pre-open period or the opening auction. Liquidity on the Odd Lot Board was often lower, and such trades typically attracted less favorable prices compared to trades on the main board. These constraints made the trading of odd lots inefficient and less attractive.
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The new NSE Trading Rules streamline this structure by integrating all share quantities onto a single trading board. Investors can now buy and sell any number of shares starting from one unit, improving access to the market. For instance, an investor with KSh 100 can now buy five shares of a company priced at KSh 20 per share, a transaction that was previously not possible under the 100-share minimum requirement.
Additionally, the NSE has introduced a new pricing rule: a stock’s end-of-day closing price will only change if at least 100 shares have been traded during that session. If this threshold is not met, the previous day’s closing price will be retained. This measure is intended to maintain the integrity of price movements while still allowing for smaller trades.
NSE Chief Executive Frank Mwiti stated that the decision was informed by extensive feedback from investors and stakeholders. The change is part of the NSE’s 2025–2029 Strategic Plan, which seeks to revitalize Kenya’s capital markets and grow the number of retail investor accounts to nine million by 2029, up from the current 1.6 million accounts. Of these, fewer than 40,000 are active. The NSE’s goal is to encourage about a third of Kenya’s working population to participate in the stock market, fostering a culture of savings and investment.
The removal of the 100-share minimum is expected to improve financial inclusion by enabling low-income and first-time investors to access Kenya’s stock market. This development aligns with Kenya’s strong digital finance ecosystem, particularly the widespread use of mobile money, which accounts for 80% of financial account ownership in the country. Platforms like NSE Easy (66544#) allow users to open Central Depository System (CDS) accounts and trade shares using mobile phones, providing convenient access for a wider population.
Market analysts expect the new rules to enhance market liquidity by increasing trading volumes and participation in equities, exchange-traded funds, and real estate investment trusts. Kenya’s stock market has performed well in recent periods. The NSE was Africa’s best-performing stock market in 2024 in dollar terms, according to the Morgan Stanley Capital International (MSCI) Frontier Markets Index. In the six months ending June 30, 2025, the NSE All Share Index gained 22.41%, the NSE 20 Share Index rose 18.54%, and the NSE 10 Share Index was up 14.28%.
The integration of odd-lot trades into the main trading system under the new NSE Trading Rules simplifies the trading process, eliminates pricing disadvantages for small trades, and is expected to drive increased activity in Kenya’s stock market. The removal of the 100-share minimum also supports the NSE’s broader efforts to make capital markets more inclusive and accessible under the revised NSE Equity Trading Rules.
Jefferson Wachira is a writer at Africa Digest News, specializing in banking and finance trends, and their impact on African economies.