Youths find fortune in capital markets

DAR ES SALAAM: FOR many young Tanzanians, investment is increasingly becoming an important pathway to financial independence, with growing numbers turning to capital markets in search of longterm wealth.

Across universities, workplaces and social media platforms, conversations that once centred mainly on employment are increasingly shifting towards treasury bonds, shares, dividends and the stock market. More young people are opening Central Depository System (CDS) accounts, attending investment seminars and exploring opportunities offered through Tanzania’s growing capital markets.

The trend reflects rising awareness that wealth can be created not only through employment and business but also through disciplined investment. Young Tanzanians say their decision to invest in capital markets is driven by the desire to build financial security beyond their regular incomes.

Neema Mwakalinga (27) said she started investing in shares after attending a financial literacy seminar, where she learnt how capital markets could help people build wealth over the long term.

“I wanted my money to work for me instead of simply keeping it in a bank account. I started with a small amount because I wanted to understand how the market works before investing more,” she said.

She said the experience had taught her that investing required patience and continuous learning rather than expecting immediate returns. Mr Baraka Msuya ( 31) said he invested because he wanted to diversify his sources of income and prepare for the future.

“I realised that depending on one source of income was risky. I wanted an investment that could grow over time, even when my business was not doing well,” he said.

He admitted that he was initially attracted by stories of people making quick profits but later learnt that successful investing depended on consistency and discipline.

“Now I look at the company’s performance, the risks involved and my longterm goals before investing,” he said.

Another young investor Florian Jamax said many beginners focus on profits while overlooking risks and market fluctuations.

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“Most beginners focus on making profits. They rarely think about the risks, market fluctuations or the patience required for long-term investing,” he said.

However, experts caution that increased participation must be accompanied by a deeper understanding of investment risks and market behaviour. Economist and investment banker Dr Hildebrand Shayo said Tanzania made significant progress in attracting young people to capital markets through efforts by the Capital Markets and Securities Authority (CMSA), the Dar es Salaam Stock Exchange (DSE), brokerage firms, universities and financial institutions.

“The key challenge now is not only to motivate young people to invest but also to ensure they do so with sound judgment,” he said.

Dr Shayo said investment education should go beyond teaching young people how to open investment accounts, buy treasury bonds or listed shares and calculate dividends and capital gains. He said investors need to understand factors such as interest-rate movements, inflation, liquidity constraints, market volatility, companyspecific risks and emotional decision-making.

“As a result, many firsttime investors believe investment guarantees wealth,” he said.

He warned that the misconception could expose inexperienced investors to significant losses when markets behave differently from their expectations.

According to Dr Shayo, some young people are attracted to capital markets by expectations of quick returns rather than long-term financial goals such as retirement, home ownership, education and wealth preservation. Dr Shayo called for financial education to become a national strategy involving government institutions, universities, employers, banks, pension funds and financial institutions.

Social media has also contributed to the trend by highlighting successful investors while often overlooking the patience and discipline behind their achievements. Senior Officer for Advisory and Research at Zan Securities, Anastazia Daffi, said financial education should begin at home and in schools.

“One of the biggest challenges in raising a financially literate generation is that money simply isn’t discussed enough, not at home, and not in schools,” she said. Ms Daffi said young people should first develop sound financial habits, including budgeting, identifying sources of income and setting financial priorities before deciding where to invest.

“Investing is a behavioural skill, not a matter of financial readiness. It is driven by consistency, discipline and long-term thinking, not by the size of your income,” she said. She cautioned young investors against expecting quick returns, saying successful investing required patience and continuous learning.