The artificial intelligence (AI) boom that has sent technology stocks soaring in major global markets could soon find a new route into Kenya’s investment market.
The Nairobi Securities Exchange (NSE) is working on an artificial intelligence-focused exchange-traded fund that could be launched before the end of 2026, allowing Kenyan investors to gain exposure to some of the biggest companies benefiting from the rapid growth of AI.
The planned fund would bring together a basket of companies with strong links to artificial intelligence. Instead of an investor having to buy shares in several foreign companies separately, the ETF would provide exposure to a group of them through one exchange-listed product.
NSE Chief Executive Officer Frank Mwiti said the exchange wants the product to reflect companies that are directly involved in the development and expansion of artificial intelligence.
“We want essentially to be able to bring a product to our market where the underlying basket is a reflection of companies that have a direct exposure to AI,” Mwiti said.
Companies such as Microsoft, OpenAI and Anthropic have been mentioned as examples of the kind of businesses that could influence the basket, although the final list of companies has not yet been released.
Bringing global technology closer to Kenyan investors
The proposal comes at a time when artificial intelligence has become one of the biggest investment themes in the world.
Huge sums of money are flowing into companies developing computer chips, cloud infrastructure, data centres and AI software. Some technology companies have seen their valuations rise sharply as investors bet that AI will reshape industries ranging from banking and healthcare to manufacturing and entertainment.
Yet for many Kenyan investors, participating in that growth has not been straightforward.
Buying shares in overseas companies normally requires access to foreign investment platforms and comes with additional considerations such as currency movements, fees and regulations. An ETF listed in Nairobi could make the process more familiar by allowing investors to access the theme through the local capital market.
The proposed fund is also expected to be denominated in Kenyan shillings, which could help reduce some of the foreign exchange complications associated with investing directly in overseas assets.
The move is part of a wider attempt by the NSE to expand beyond its traditional dependence on banks, telecommunications and other established companies.
Kenya’s stock market has historically been dominated by large counters such as Safaricom and major banks. While these companies remain important, the exchange has been looking for ways to offer investors exposure to different sectors, markets and investment ideas.
The exchange has already been adding new products to its market, including exchange-traded funds that provide access to international markets.
The proposed AI ETF would take that diversification a step further by connecting the Nairobi market to one of the fastest-growing areas of the global economy.
Mwiti said younger investors are among those showing strong interest in international investments. He noted that some Kenyans are already putting money into foreign markets because they do not find enough variety in products available locally.
“Kenyans are actually investing in foreign markets because of lack of product diversity here,” Mwiti said.
That growing interest could provide a ready market for the new product, particularly among younger Kenyans who have become more familiar with global technology companies through social media and online investment platforms.
NSE weighs opportunity against AI risks
The exchange is also benefiting from easier access to the stock market.
Safaricom introduced share trading through M-Pesa earlier this year, helping bring more people into the investment market. Mwiti said the service had contributed to about one million new investors entering the market.
That growing pool of retail investors could become important for new products such as the proposed AI ETF, particularly if the exchange makes it simple for people to buy and sell units.
However, artificial intelligence stocks are not a guaranteed money-making machine.
The enormous enthusiasm around AI has raised concerns about whether some technology companies have become too expensive compared with their actual earnings and prospects. Investors have poured money into the sector at a remarkable pace, but questions remain about whether companies will eventually generate enough profits to justify their high valuations.
Mwiti acknowledged the concern, saying there was “a vibe in the market that there might be a bubble around AI.”
That means the exchange could reconsider the timing of the launch if market conditions become too risky.
The caution is important because an ETF does not remove investment risk. If the companies inside the fund lose value, investors in the ETF will also feel the impact. Its performance would depend on the companies included in the basket, the overall performance of global technology stocks, investor demand and the cost of managing the fund.
Still, the planned product represents a significant shift for Kenya’s capital market. If launched successfully, it could give ordinary investors a simpler way to participate in the global AI story while helping the NSE attract new investors and keep more investment activity within the local market.
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