Economy
Building Wealth in Stock Market by Capital Appreciation and Dividend Payment
By Emmanuel C Agubuo
The stock market is a device for transferring wealth from the impatient (pessimistic and fearful investor) to the patient (intelligent and daring investor), Warren Buffett.
Success in stock market investment is dependent on the understanding of its intricacies and managing them to your advantage, Emmanuel C Agubuo.
Purpose of Stock Market
The need for companies to raise money and investors to profit from it is the essence of the stock market and that is what keeps it going.
There are three major ways to profit from the capital market.
1 By capital appreciation.
2 Dividend yields.
3 Bonus issue.
The first two are regular, but the third isn’t and it occurs when the company decides to do it.
Now, if you’re a capitalist-minded investor, you can decide to take profits as many times as possible and as you choose, especially if the stock appreciates more than you bought it. What this means in essence is that the capitalist investor decides what he wants and earns.
But a core dividend income investor has no such option(s). His only option is when the company declares dividends or bonus, either once or twice in a year and in rare cases, more.
So, his earnings or profits depend entirely on what the company chooses to give him at a particular time and not on what he decides to earn.
In order to make sure these set of passive investors keep their money with them, companies declare dividends and sometimes, bonus issues so as to make shareholders happy.
But one key question to ask is ‘is dividend income the real deal in stock market investments?’ Well, the answer varies from one investor to the other because each of their investment objective isn’t the same.
However, it is advisable that you do all you can to maximize more profits from the capital market. I believe that’s what brought you into it in the first place. Or is there anything else? You just came to watch others make the big money?
Or are you just satisfied with the peanuts from dividends? Ok, that’s your choice. Everyone is entitled to his or her choice. There’s no problem about that.
Now hear this, dividend payments in stock market investment is a bait. Don’t be caught and don’t be distracted by it. Because if you focus on it as your core means of building wealth through the capital market, it will deter you from maximizing opportunities of share appreciation, which can fetch you over 100 percent yield.
See, dividend payment is a device conceived by stock market inventors (companies) to access and consolidate huge capital almost free of charge or with lesser interest rates or payment, unlike if they had gone to the bank to borrow such huge amount of money.
The companies pay the dividends simply for consolation as to enable them keep the huge funds perpetually. This is one of the reasons you shouldn’t make dividend income your CORE mission in stock market investment. Simply take it whenever it comes, but don’t make it your CORE; that’s what I do.
However, it depends on your age, shrewdness and level of risk taking. But you have to be very smart.
Nevertheless, investing for dividend income yields is a strategy of its own; based on one’s major objective in the stock market. Investing for capital appreciation or gain is a strategy of its own too and everything boils down to individual perception, understanding, shrewdness and preference.
Though, the two can be combined. But for me, the fastest way to build wealth through the stock market is by capital appreciation in the medium to long term horizon. This doesn’t mean you should sell all your holdings at once. You can sell some or in tranches, but leave your core holdings and watch until the price rises to its top most peaks if needs be.
In other words, building wealth through capital appreciation in the stock market is not a sprint. It is a marathon. It is like a relay race. You need to be savvy, patient and persistent.
Theretofore, to profit more from the stock market investment, do all you can to learn the art of investing in it than the act. The profit is made in the arts and not the act.
A word is enough for the wise. See you at the top. Cheers.
Emmanuel C Agubuo is an entrepreneur, an investor in stocks, real estate and a stock market information strategist. He also helps to strategize on better ways to invest in the stock market profitably.
By Bon Peter
The Area 11 Command of the Nigeria Customs Service (NCS) in Onne, Rivers State surpassed its 2024 annual revenue target by N16 billion.
This information was revealed to newsmen by the Customs Area Controller of the Command, Mr Mohammed Babandede, at a news conference last week.
He also disclosed that the command recently intercepted 12 containers of illicit drugs worth over N20.30 billion concealed in various items.
According to him, the content of the seized container included 1,721,100 bottles of 100ml cough syrup codeine, 510,000 tablets of 50mg Really Extra Diclofenac, 7,100,000 tablets of 225mg Royal apple Tramadol and Tramaking, 3,461 pieces of sanitary ware fittings used for concealment, 840 pieces of Chilly cutter used for concealment, and 153 cartons of TVS rubber.
“Our vigilant officers and men have successfully intercepted and seized an additional 12 containers (40 feet) of illicit medicine.
“This is a testament to our unwavering commitment to safeguarding public health, ensuring security of our nation and compliance with Nigeria’s import regulations. This also justifies our commitment to trade facilitation, transparency, effective and efficient service,” he said.
He said last year, the command received the support of different stakeholders, thanking them for working with the agency to achieve success.
“We appreciate the continued support and collaboration of all stakeholders, including the media, in amplifying our message and efforts to combat smuggling,” he said.
Mr Babandede stated that, “It is worth noting that the morale and dedication of our officers have been significantly bolstered by the Comptroller-General of Customs’ award, recognizing Area 2 Command as the Best Command in Anti-Smuggling Operations.
“This honour has further strengthened our resolve, and I assure you that we will not relent in performing our duties to protect the lives and well-being of Nigerians.”
The customs chief said earlier last year, the command was given a revenue target of N618 billion but as of December 31, 2024, it generated N634 billion, higher than the N321 billion recorded in 2023, promising to do more in 2025.
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited appreciated by 0.39 per cent on Friday as the demand for local equities continued to increase.
During the final trading session of the week, the insurance maintained its upward trend with a growth of 7.81 per cent as the banking index appreciated by 1.08 per cent, the consumer goods sector rose by 0.52 per cent, and the industrial goods counter expanded by 0.33 per cent, while the energy space went down by 0.49 per cent.
At the close of business, the All-Share Index (ASI) jumped by 406.19 points to 103,586.33 points from 103,180.14 points, and the market capitalisation increased by N248 billion to N63.166 trillion from N62.918 trillion.
The bourse recorded 67 appreciating shares and 11 depreciating shares, implying a positive market breadth index and strong investor sentiment.
Chams, Omatek, NCR Nigeria, Learn Africa, and Regency Alliance topped the gainers’ table after they gained 10.00 per cent each to finish at N2.31, 88 Kobo, N6.05, N4.95, and 88 Kobo, respectively.
On the flip side, TotalEnergies lost 9.74 per cent to trade at N630.00, CWG depreciated by 6.04 per cent to close at N7.00, Thomas Wyatt went down by 5.26 per cent to N1.80, ABC Transport crumbled by 4.07 per cent to N1.18, and UAC Nigeria shed 3.19 per cent to N31.90.
Yesterday, investors traded 709.3 million stocks valued at N8.2 billion in 13,593 deals compared with the 829.8 million stocks worth N5.7 billion transacted in 11,752 deals on Thursday, representing a slowdown in the trading volume by 14.52 per cent and a rise in the trading value and number of deals by 43.86 per cent and 15.67 per cent, respectively.
At the close of business, Chams topped the activity log with 58.1 million equities sold for N133.8 million, Veritas Kapital traded 55.1 million shares valued at N89.2 million, Abbey Mortgage Bank exchanged 50.1 million stocks for N165.5 million, AIICO Insurance transacted 39.7 million equities worth N68.3 million, and NPF Microfinance Bank sold 34.3 million stocks valued at N64.0 million.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange extended its positive start to the year with a 0.08 per cent rise on Friday, January 3.
The market saw a gain of N840 million, with the value of the alternative bourse growing to N1.046 trillion from the N1.045 trillion it closed a day earlier as the NASD Unlisted Security Index (NSI) made an addition of 2.43 points to wrap the session at 3,052.34 points compared with 3,049.91 points recorded at the previous session.
The appreciation posted yesterday at the NASD OTC exchange was caused by two price gainers led by Industrial and General Insurance (IGI) Plc which jumped by 2 Kobo to end at 20 Kobo per share compared with the preceding session’s 18 Kobo per share and UBN Property Plc, which improved its value by 16 Kobo to close at N1.98 per unit, in contrast to Thursday’s closing price f N1.82 per unit.
The market posted a price loser, which was FrieslandCampina Wamco Nigeria Plc as it dropped 18 Kobo to finish at N39.76 share versus the previous day’s N39.94 per share.
There was an 856.6 per cent surge in the volume of securities traded in the session to 11.3 million units from the 1.2 million units traded in the preceding session.
Equally, there was a jump in the value of shares traded yesterday by 1,078.4 per cent to N56.8 million from the N4.8 million made previously, and the number of deals increased by 22.7 per cent to 27 deals from 22 deals.
FrieslandCampina Wamco Nigeria Plc was the most active stock by value (year-to-date) with 1.4 units worth N55.8 million, IGI Plc came next with 10.6 million units valued at N2.1 million, and 11 Plc was in third with 6,45 units sold for N1.4 million.
IGI Plc closed the day as the most active stock by volume (year-to-date) with 10.6 million units sold for N2.1 million, FrieslandCampina Wamco Nigeria Plc came next with 1.4 million units valued at N55.8 million, and UBN Property Plc followed with 275,740 units worth N545,965.
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