The Nairobi Securities Exchange (NSE) is developing East Africa's first AI-focused exchange-traded fund (ETF), targeting a launch before the end of the year as it widens the range of investment products on offer to Kenyan investors.
NSE chief executive Frank Mwiti told Reuters the exchange wants to bring a product to market with "a reflection of companies that have a direct exposure to AI." Microsoft, Anthropic and OpenAI could serve as reference points for the basket, he said.
Anthropic and OpenAI are both privately held and not listed on any exchange, meaning the fund could not hold their shares directly.
Mwiti's framing suggests the basket would track AI exposure thematically rather than hold those companies outright, though the exchange has not detailed the mechanism.
The NSE has not disclosed the constituent companies, index methodology, fees or the structure through which international exposure would be obtained. The fund will most likely be denominated in shillings to limit foreign exchange risk for local investors, Mwiti said.
Kenyans are increasingly investing in foreign markets due to a lack of product diversity at home, he added. Demand for an AI product is strongest among newer, younger entrants to the market, a cohort that has grown quickly since Safaricom began offering share trading on its M-Pesa platform in February, a move Mwiti said brought in a million new investors.
Mwiti said the exchange will study the global AI rally closely and could delay the launch to avoid exposing investors to an overextended market. There is a sense that AI could be in a bubble, he said, adding that the bourse may take a wait-and-see approach on timing.
The NSE is engaging the Capital Markets Authority (CMA) to secure the approvals needed before launch, including compliance with disclosure standards and investor protection requirements.
The exchange has listed only two ETFs in its history: the Barclays NewGold ETF in 2017 and the Satrix MSCI World Feeder ETF in 2025. An AI-focused fund would test its product pipeline under the 2025–2029 strategy, which targets 50 new funds. The Johannesburg Stock Exchange listed a comparable AI-focused ETF, IVYA, in March, making Nairobi's product a regional first for East Africa rather than the continent's first.
The bourse is also weighing a cryptocurrency ETF tracking bitcoin, ethereum and solana, which could launch next year once Kenya finalises legislation governing digital assets under the Virtual Asset Service Providers Act.
The AI ETF forms part of a broader push under NSE chairman Tom Mulwa, who took over the board in July, to diversify the exchange's offering beyond conventional equities through corporate debt, real estate investment trusts and digital investment products.
Kenya's stock market capitalisation hit Sh4 trillion ($30.9 billion) in early August, driven by a rally in blue-chip counters and new listings.
Digital distribution platforms are central to the exchange's retail strategy. Ziidi Trader, a mobile trading platform, has processed more than 351,000 trades and surpassed Sh1 billion ($7.7 million) in cumulative turnover. The NSE has roughly three million investor accounts and is targeting nine million domestic investors
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