Santiago Exchange: Financial education in the age of Covid-19

By: José Antonio Martínez, Chief Executive Officer, Santiago Exchange Sep 2020

Financial literacy is one of the foundations for developing healthy capital markets that are sustainable over time. This is a particularly relevant issue today as the Covid-19 pandemic has strongly impacted activity levels, expectations and personal, local and global economies.

As facilitators of the securities market in Chile, one of our challenges is to supply investors and market participants with tools to make better investment decisions. Thus, we have taken on financial literacy as an ongoing project centred around the key elements of information and the sharing of knowledge. In this spirit, we promote savings, responsible investment and financial inclusion initiatives.

Knowledge for market players

In addition, we have made financial literacy a cornerstone of our development, in order to meet the demand for knowledge from existing and potential market players acting in a variety of roles. In this way, we support the financial industry’s efforts to provide information, tools, knowledge and training regarding our securities market.

Santiago Exchange also promotes responsible investment by publishing guides, launching and promoting green and social bonds and creating indexes like the DJSI Chile and DJSI MILA in partnership with Standard & Poor’s. We recently launched our Sustainability Matrix, a virtual space containing tools and information on our issuers’ environmental, social and corporate governance (ESG) performance, important aspects that now impact a company’s development beyond its financial results and are increasingly employed in investor decision-making.

As part of our financial literacy strategy, and in direct relation to sustainable development, we put these topics on the agenda of our community and market participants, whether through free online talks to high school and university students, introductory courses for novice securities investors, as well as through courses, training sessions and specialised programmes for market agents taught by leading local and international institutions.

We also build partnerships and collaborate with educational institutions and organisations specialising in important areas like risk management, financial market cybersecurity and sustainability, among others. In terms of training, Santiago Exchange has worked with diverse stakeholders to form Chile's Securities Market Knowledge Accreditation Committee (CAMV in Spanish). This body is charged with raising standards of knowledge for people working in our market, requiring world-class accreditation and regulating continuous education programmes in technical, regulatory and ethical matters.

Real-time stock trading

Another of our initiatives is the time-honoured Investment Portfolio Contest (CCI in Spanish). In existence for over 30 years, each year the programme invites high school and university students to take part in an online, real-time stock trading simulation to earn the highest returns. In 2019 alone, it attracted more than 2,500 student participants. Similarly, this year we launched the Investor League, an online competition open to all market participants and the community at large. Registration fees this year helped raise funds for the Compassionate Research Project led by the Arturo López Pérez Foundation, which works to provide medical treatment for patients seriously ill with Covid-19.

In addition, each year we join the call from WFE and IOSCO to Ring the Bell for Financial Literacy, an opportunity to underscore the importance these topics play in sustainable market development and our countries’ economies. The 2020 edition will include a symbolic virtual activity featuring testimonies from market representatives and regulators that will be available throughout the month of October.

We understand that sustainable development involves taking responsibility for and fostering the spread of knowledge among the multiple stakeholders that make up, and participate in, the market, either directly or indirectly. This is an ongoing challenge in an ever-evolving market with new segments, instruments, transaction types, technologies and risks, which drives us to explore different media, methods, methodologies and strategies. We do all this so that investors and market participants can make decisions or recommendations with fundamentally sound knowledge and sufficient information, essential requirements for responsible investment.