Nepal, Feb. 4 -- Nepal Stock Exchange (NEPSE) needs to diversify the investment instruments, revise the trading modality and revise share structures in the NEPSE to attract notable investment in the country's secondary market.

Currently, the trading at the NEPSE is largely based on equity. Ordinary shares, debentures and mutual funds are among the instruments being traded in NEPSE. "In the context of limited instruments being traded, investors have not had the opportunity to manage risk through investment diversification," reads a report unveiled recently by the Ministry of Finance.

The government had earlier formed the committee under the leadership of Prakash Jung Thapa, former chairman of the NEPSE. The panel has recommended the rest...