Economy

Understanding Terms Used in Stock Market (Part 1)

Published

8 years ago

27/07/2018

By Dipo Olowookere

The last time, I wrote about key things to take note of before investing in the recharge card business especially with the way fraudsters try to lure unsuspecting victims into the business.

Today, I am focusing on the stock market, explaining some terms used in the sector.

The stock or equity market is one aspect of the capital market some people get confused about because of its high volatility.

By high volatility, I mean you can gain a huge amount in one trade and loss everything in the next transaction. It is unlike the fixed income market, another aspect of the capital market, where at the point of investment, you know what you are getting as profit.

Now to the common terms used in the market.

Share/Equity/Stock

These terms are commonly used interchangeably and they mean the same thing. A share is like an indivisible unit of capital showing you are one of the owners of a company.

When a company, owned by more than one person, is established and registered as a business entity, it must indicate its ownership structure, which is represented by the number of shares held by each of the persons. It is by this percentage the owners share any profit or dividend recorded by the firm during a given period of time.

Now, a company in need of cash to expand its operations can approach the stock exchange to sell its shares to the general public through an Initial Public Offering (IPO), also expanding the number of persons owning stakes in the firm.

When this is done, the stock market regulator, which is the stock exchange, allows trading of the shares of such company on its platform.

The value of these stocks at the market are determined by demand and supply as well as information about company, the sector or the country’s economic and political happenings.

If a company is having an internal crisis that found its way to the public domain, it is natural for some people, who bought shares of the firm, to panic and if they foresee that the crisis could be ‘brutal’, they will quickly offload (sell off) their shares, resulting in many sellers, but less buyers. Like in the elementary Economics, when this happens, the price of the commodity falls; vis-à-vis.

Trade

This is mainly the buying and selling of stocks on the floor of the exchange. It is the process of executing a transaction; selling or buying of shares of a company at the stock market at a particular price.

Deal

It is a single transaction carried out by a shareholder or investor during trading in the stocks of a company at the market.

Volume

The volume of shares is the total number of units of equities traded during a given period of time at the stock exchange. As expected, the volume of shares transacted by investors at any given trading session either rises or falls.

Value

This is the worth of an equity trading at the stock market. In stock market reporting, this could mean the total worth of stocks traded at the market for a given period of time.

Market Capitalisation

This is simply the total value of shares of the company selling its shares at the stock market. For example, if a company has a total of 1,000 shares selling at N5 each, its total capitalisation would be 1000xN5, which gives us N5,000.

As at the close of trading on Thursday, the total value of shares trading at the Nigerian Stock Exchange stood at N13.196 trillion.

All-Share Index (ASI)

The ASI is a bit complex, but I will try to break it down to make it understandable. It is mainly a statistics showing the direction or performance of the stock market.

Because during a trading day, some stocks will appreciate in price, while others will depreciate in value, with some remaining unchanged. As a result, there was the need to have an indicator showing a true reflection the market’s performance at the trading session.

So, in January 1984, the NSE put its index at 100 points and as at yesterday, it closed at 36,427.22 points after gaining 80.42 points.

Bear Market

This is when the market records a loss

Bull Market

This is when the market records a gain

Full Bid

This simply occurs when there are prospective buyers at the stock market but no willing sellers. This happens when investors have information that the stock may appreciate in price and there is a rush to own the stock so as make profit after selling it at a higher price.

Full Offer

This is the direct opposite of ‘full bid’. This occurs when there are prospective sellers of a stock but no buyers.

52 Week High

This is simply the highest value a particular stock was sold at in the past 52 weeks (one year).

52 Week Low

This refers to the lowest value a particular stock was sold at in the past 52 weeks (one year).

I will continue this piece in a subsequent post.

However, before then, please feel free to let me know where you require any further clarification.

Economy

MRS Oil, FrieslandCampina Wamco Shrink NASD Index by 0.68%

Published

2 hours ago

06/06/2026

Adedapo Adesanya

By Adedapo Adesanya

The duo of MRS Oil and FrieslandCampina Wamco Nigeria Plc weakened the NASD Over-the-Counter (OTC) Securities Exchange by 0.68 per cent on Friday, June 5.

MRS Plc lost N19.00 during the session to sell at N171.00 per share compared with Thursday’s value of N190.00 per share, and FrieslandCampina Wamco Nigeria Plc depreciated by N8.70 to finish at N181.68 per unit compared with the preceding session’s N190.38 per unit.

As a result, the market capitalisation further lost N22.59 billion to close at N2.607 trillion versus the N2.630 trillion it ended a day earlier, and the NASD Unlisted Security Index (NSI) dropped 37.76 points to settle at 4,358.32 points, in contrast to the previous day’s 4,396.08 points.

The alternative stock market closed the last trading day of this week with a price gainer, Central Securities Clearing System (CSCS) Plc, which gained 6 Kobo to quote at N78.40 per share compared with the preceding session’s N78.34 per share. However, it could not prevent the market from going down at the close of business.

Yesterday, the volume of securities bought and sold by investors went down by 50.0 per cent to 140,345 units from the preceding day’s 280,714 units, the value of stocks decreased by 16.5 per cent to N17.9 million from the previous session’s N21.5 million, and the number of deals carried out by market participants fell by 35.7 per cent to 27 deals from the 42 deals recorded on Thursday.

When trading activities closed for the day, Great Nigeria Insurance (GNI) Plc remained the most active stock by value on a year-to-date basis, with 3.4 billion units exchanged for N8.4 billion, trailed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units sold for N6.5 billion, and CSCS Plc with 64.7 million units traded for N4.4 billion.

GNI Plc also ended the session as the most traded stock by volume on a year-to-date basis, with 3.4 billion units worth N8.4 billion, followed by Infracredit Plc with 2.3 billion units transacted for N6.5 billion, and Resourcery Plc with 1.1 billion units valued at N415.7 million.

Economy

NGX Index Rebounds 0.15% on Renewed Interest in Financial Stocks

Published

2 hours ago

06/06/2026

Dipo Olowookere

By Dipo Olowookere

Renewed interest in financial stocks and others lifted the Nigerian Exchange (NGX) Limited by 0.15 per cent on Friday.

Customs Street closed higher yesterday despite the 1.37 per cent loss recorded by the consumer goods sector as a result of profit-taking.

This was offset by gains in the other key sectors of the local bourse, as the insurance counter chalked up 1,14 per cent. The banking space appreciated by 0.90 per cent, the industrial goods segment grew by 0.46 per cent, and the energy sector expanded by 0.01 per cent.

Consequently, the All-Share Index (ASI) went up by 366.00 points to 242,593.31 points from 242,227.31 points, and the market capitalisation gained N235 billion to close at N155.594 trillion compared with the previous day’s N155.359 trillion.

The trio of International Energy Insurance, Abbey Mortgage Bank, and DAAR Communications improved by 10.00 per cent each yesterday to N7.26, N9.35, and N1.98, respectively, while Zichis advanced by 9.39 per cent to N32.38, with Sovereign Trust Insurance up by 8.70 per cent to N2.50.

On the flip side, Academy Press lost 9.84 per cent to quote at N8.25, University Press depreciated by 9.73 per cent to N5.10, Africa Prudential dipped by 2.63 per cent to N12.95, Chams crumbled by 2.44 per cent to N4.00, and International Breweries slipped by 1.59 per cent to N12.35.

Business Post reports that the market breadth index was positive during the session after recording 37 appreciating equities and 14 depreciating equities, implying strong investor sentiment.

Abbey Mortgage Bank led the activity chart with a turnover of 164.1 million units worth N1.5 billion, Ellah Lakes sold 76.7 million units for N767.2 million, Access Holdings transacted 44.8 million units valued at N1.1 billion, Linkage Assurance exchanged 23.0 million units worth N41.2 million, and The Initiates traded 20.2 million units for N562.1 million.

At the close of trades, market participants transacted 608.5 million units worth N32.0 billion in 53,826 deals versus the 588.5 million units valued at N27.9 billion executed in 57,352 deals in the previous session. This showed that the number of deals eased by 6.15 per cent, the volume of transactions rose by 3.40 per cent, and the value of transactions soared by 14.70 per cent.

Economy

Naira Depreciates to N1,362/$1 at Official Market

Published

3 hours ago

06/06/2026

Adedapo Adesanya

By Adedapo Adesanya

The Naira further depreciated against the United States Dollar by N3.46 or 0.25 per cent to N1,362.21/$1 from N1,358.75/$1 in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Friday, June 5.

However, it appreciated against the Pound Sterling in the same market window during the session by N4.47 to trade at N1,823.59/£1 compared with the previous day’s N1,828.06/£1, and gained N7.00 against the Euro to sell at N1,574.58/€1, in contrast to Thursday’s closing price of N1,581.58/€1.

For another trading session, the Nigerian Naira maintained stability against the Dollar in the parallel market and the GTBank forex counter on Friday at N1,375/$1 and N1,372/$1, respectively.

The Naira is expected to remain strong in the near term, backed by a rise in external reserves, which are nearing $50 billion, enhancing analysts’ confidence about its outlook in the second half of 2026.

Heightened global uncertainty has reduced the incentive for importers and corporates to demand FX, as cautious trade weighs on import needs. Analysts estimate a $40 billion net FX position for the year, a projection anchored in oil windfall gains.

As for the cryptocurrency market, prices remained depressed following a strong US jobs report that spurred markets to price in higher-for-longer interest rates, sending Treasury yields and the dollar up while hammering stocks, especially AI-related names. Crypto markets saw heavy leverage washouts with about $1.6 billion in positions liquidated over 24 hours.

Ethereum (ETH) gave up 4.9 per cent to trade at $1,584.68, Solana (SOL) fell by 3.3 per cent to $63.22, Bitcoin (BTC) crashed by 1.9 per cent to $61,333.23, Dogecoin (DOGE) slipped by 1.8 per cent to $0.0821, and Ripple (XRP) moderated by 1.8 per cent to $1.09.

Further, TRON (TRX) dropped 1.6 per cent to sell at $0.3197, Binance Coin (BNB) slumped by 1.0 per cent to $581.18, and Cardano (ADA) declined by 0.4 per cent to $0.1589, while the US Dollar Tether (USDT) gained 0.07 to sell at $0.9997, and US Dollar Coin (USDC) closed flat at $0.9998.