Old Mutual Limited finished its first trading session on the Victoria Falls Stock Exchange at US$0.7817 on Wednesday, placing the Zimbabwe traded line within 1% of the valuation carried by its primary listing on the Johannesburg Stock Exchange.

The first session produced 55 trades involving 46,402 shares with a total value of US$36,274.44. Dividing turnover by shares traded gives an average traded price of US$0.78174, effectively matching the US$0.7817 closing price published by VFEX.

Price discovery covered a much wider range during the session. Old Mutual traded as high as US$1.20 and as low as US$0.75, creating a 60% spread between the day’s extreme prices.

That range developed under special first day trading conditions. VFEX removed its usual trading price limits for Old Mutual’s opening session, allowing bids and offers to establish the initial market price without a previous VFEX closing price. The normal 20% trading limit based on the preceding closing price becomes applicable from the second trading day. 

The wide first day range therefore captured the market’s initial valuation exercise after six years without domestic trading in the share. Old Mutual had remained suspended in Zimbabwe since 2020. The company had already warned shareholders that its VFEX price was market determined and carried no guaranteed relationship with its JSE price or prices on its other exchanges.

The completed session produced a much tighter relationship.

Old Mutual closed on the JSE at R12.75 on Tuesday, the final session before trading started on VFEX. Using the Reserve Bank of Zimbabwe’s Wednesday mid rate of ZAR16.1887 to the US dollar, the JSE price translated to approximately US$0.7876. 

The US$0.7817 VFEX closing level sat about 0.75% below that reference.

The JSE share then finished Wednesday at R12.56 after losing 1.49% during the session. At the same RBZ exchange rate, that price translated to about US$0.7759. Old Mutual’s VFEX closing price was about 0.75% above that end of day JSE equivalent.

The two comparisons place the first VFEX closing price inside a narrow band around the company’s primary market valuation.

That outcome is important for the quality of price discovery on the VFEX. The absence of first day limits allowed Old Mutual to trade at levels extending considerably away from JSE parity. The US$1.20 session high was about 52% above the US dollar equivalent of Tuesday’s JSE close. The US$0.75 session low was about 5% below it. Accumulated trading subsequently produced a session average close to the external market reference.

The final transaction was completed at US$0.76. This was about 2% below the US dollar equivalent of Old Mutual’s Wednesday JSE close and below the US$0.7817 session average. Thursday’s trading will therefore provide the next test of where the local order book settles once normal price limits return.

Participation also gives an early measure of the depth available for the counter. Old Mutual’s 55 trades made it the second busiest VFEX equity by trade count on Wednesday, behind Innscor Africa’s 60 trades. Old Mutual accounted for approximately 7.4% of the exchange’s US$493,482.70 equity turnover and about 2.9% of the 1.59 million shares traded across the market.

Its US$36,274 turnover ranked behind Innscor Africa, Axia Corporation and First Capital Bank by traded value. The number of individual trades therefore carried a stronger showing than the amount of capital exchanged.

The scale of the JSE market remains an important reference for assessing depth. Old Mutual traded 19.9 million shares worth about R251.8 million on the JSE on Wednesday. The VFEX line is starting with a much smaller pool of trading activity and now has a locally established US dollar price from which that liquidity can develop.

The first session completes the immediate market price discovery required after Old Mutual’s lengthy suspension. The company returned with no inherited VFEX price, traded across a US$0.45 range and finished almost exactly around its JSE equivalent.

From Thursday, the market enters a different phase. Applying the normal 20% limit to Wednesday’s US$0.7817 closing price gives approximate boundaries of US$0.6254 and US$0.9380. Trading activity inside that range will begin establishing whether Wednesday’s convergence around JSE parity can persist as the Zimbabwe order book develops.

For VFEX, the first session has already established one important market outcome. A globally traded security was allowed unrestricted opening price discovery and the accumulated trades produced a US dollar valuation close to the price carried on its primary exchange.