By Kehinde Ibrahim, Lagos
NIGERIA is experiencing a remarkable transformation that has caught the attention of seasoned global investors, the Research Alpha fund.
Michael McGaughy, founder of Research Alpha fund and a veteran Asia-Pacific investor with nearly four decades of experience in emerging markets, has identified Nigeria as offering unprecedented investment opportunities comparable to Indonesia following the Asian Financial Crisis.
The globally acclaimed fund manager has adjudged Nigeria as having “the world’s best equity set-up” following comprehensive economic reforms that are beginning to deliver tangible results.
His fund, which has generated a +130 percent return since inception, has been positioned in Nigerian equities since 2017 and is now witnessing the fruits of patient capital deployment.
The convergence of deep value, fundamental reform, and improving market dynamics positions Nigeria as what McGaughy calls “the world’s best equity set-up” – a rare combination that has historically delivered exceptional returns for investors with the conviction to act when others remain sceptical.
According to McGaughy, in an interview with Asian Century Stocks, Nigeria’s transformation began with President Bola Tinubu’s inauguration approximately two years ago, which triggered “far-reaching reforms, including freeing the currency, ending petrol subsidies, and deregulating electricity generation and distribution.”
These measures, he noted, represent “a developmental economist’s wet-dream.” The reforms have been particularly significant in addressing long-standing structural issues. The launch of the massive Dangote refinery is set to end the foreign exchange-draining practice of exporting crude oil while importing refined products. “It’s big enough to supply all West Africa, so the country could start exporting refined products very soon,” McGaughy observed, highlighting the facility’s potential to transform Nigeria into a regional energy hub.
Central to Nigeria’s economic turnaround has been the appointment of Central Bank of Nigeria (CBN) Governor Olayemi Cardoso, who recently emerged as the Central Bank Governor of the Year at the 2025 African Banker Awards for his role in “steering monetary and regulatory reforms that have restored stability and confidence in Nigeria’s financial system.” Since taking office in September 2023, Cardoso has implemented aggressive monetary policy measures to combat inflation and restore market confidence.
The CBN raised the Monetary Policy Rate by 875 basis points to 27.5 percent in 2024, a decisive move that demonstrated the central bank’s commitment to price stability despite short-term economic pressures. The reforms under Cardoso’s leadership have been comprehensive, focusing on “stabilising prices, improving the foreign exchange market, and fostering sustainable growth” while addressing fundamental structural issues that had previously undermined investor confidence.
The Nigerian equity market is responding positively to the reform agenda. McGaughy reported that the country’s All Share index has gained nearly 18 percent year-to-date despite weak oil prices affecting Nigeria’s largest export commodity.
