Economy
How to Start Forex Trading in Nigeria
Forex trading is no longer a term used exclusively by banks where it was used by them to make money for themselves. Forex trading is now a viable option for every individual who wants to earn money from it.
The internet has brought in a new wave of investors in this type of trading. Individuals can now trade with as little as $100 that too right from the comfort of their bedroom.
A physical location is no longer a barrier. This becomes all the more vital during the pandemic wherein people have lost their jobs and are now looking for opportunities to work from home to make a living.
If you are new to forex and are looking for trading in the same from Nigeria, below mentioned are some tips to help you get started.
Understanding Forex Trading
The online currency exchange trade of buying and selling currencies from different countries is called forex trading. The economic condition of that particular country that you want to trade in plays an important role. This is because the economic condition is never static, therefore, the forex market is never stagnant at any given time. You have to be alert and trade when the currency goes up and refrain from trading when it goes down. Prepare yourself with some serious training about forex trading and markets.
Find A Reputable Broker
After you have got a grasp on how everything works, the next step is the most vital one. You will have to search from a list of forex brokers in Nigeria to find one that you can work with. You must be careful before finalizing one.
A broker that is not online is an absolute no-no. The online ones must be reputable and have the necessary license to prove that they are properly regulated. They must also have enough capital funds to support you. Their website should have all the necessary features to make your trading easier. The website should also be friendly with all gadgets so you don’t skip any important update and can access it from your mobile phone if the need be.
Start With A Demo Account
Once you know in theory all that is necessary, the next step is to apply it practically. While you may still be new to the concepts, creating a demo account will be helpful.
Many online broker platforms provide users with a chance to create a demo account free of charge. With this account, you will be able to practice what you learned in theory in an environment that looks like real-time trading.
The accounts have virtual money that you can trade with. This will give you an idea of how to use your funds wisely to make profits and avoid losses. You will, however, make no real profits or losses when you use the demo account.
Attention To Details
You should be sharp when you are trading in the forex market. This starts when you are opening your account itself. Check if the signup process is easier. If the initial investment is too high then refrain from signing up.
Also, check to see if the broker platform has given all the details of the costs involved. Some trades are costlier than others and you may end up paying more fees for trading than the actual amount of money you make. Make sure the website is legit as you will be disclosing sensitive information like your passport copy, credit card details, and so on. When this data goes into the wrong hands, you could face a lot of losses for a long time.
Trade Methodically
There are many online tutorials and TV shows wherein how to trade in the forex market is expansively discussed. Practice your due diligence and find your own methods and techniques. Do not be lured by every piece of advice.
There are no hard ad fast rules that work the same for everyone. Limit your daily trades. There are many people who are making lots of money from forex trading in Nigeria but it all depends on their skills. You have to learn and enhance your skills at the same time to be able to make the same numbers.
Know Your Limits
Sometimes when you make a small profit, you may be tempted to reinvest it continuously. Know your limits and learn when you need to stop. You don’t have to rush into everything. Sometimes the stock may appear like a good investment but may actually be preparing for a plummet. So be careful and take your time when you trade.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange extended its stay in the south for the fourth consecutive session after it shed 1.18 per cent on Friday, March 13.
The unlisted securities market recorded a loss despite closing without a price decliner, and ending with two price gainers led by Geo Fluids Plc, which gained 1o Kobo to sell at N3.10 per share compared with the previous day’s N3.00 per share. Industrial and General Insurance (IGI) Plc appreciated during the session by 2 Kobo to trade at 54 Kobo per unit versus Thursday’s closing price of 52 Kobo per unit.
When the market closed for the day, the market capitalisation lost N29.83 billion to close at N2.489 trillion compared with the N2.519 trillion it finished a day earlier, and the NASD Unlisted Security Index (NSI) crashed by 49.84 points to 4,160.46 points from 4,210.31 points.
Market activity improved yesterday, as the volume of transactions rose 179.5 per cent to 10.4 million units from 3.7 million units, but the value of trades declined by 68.4 per cent to N29.9 million from N95.0 million, while the number of deals weakened by 11.5 per cent to 46 deals from 52 deals.
Central Securities Clearing Systems (CSCS) Plc remained the most active stock by value on a year-to-date basis with 38.4 million units worth N2.4 billion, Okitipupa Plc followed with 6.4 million units traded at N1.1 billion, and FrieslandCampina Wamco Nigeria Plc transacted 6.3 million units for N584.3 million.
Resourcery Plc ended the trading session as the most traded stock by volume on a year-to-date basis with 1.1 billion units valued at N415.6 million, trailed by Geo-Fluids Plc with 130.8 million units valued at N504.5 million, and CSCS Plc with 38.4 million units worth N2.4 billion.
By Adedapo Adesanya
The Naira continued to claw back some gains against the Dollar in the different segments of the foreign exchange (FX) market, as its value was strengthened on Friday.
In the black market, it gained N10 against the United States Dollar yesterday to close at N1,400/$1 compared with the preceding day’s rate of N1,410/$1, and at the GTBank forex counter, it chalked up N6 to close at N1,385/$1, in contrast to the N1,391/$1 it was traded a day earlier.
Similarly, in the Nigerian Autonomous Foreign Exchange Market (NAFEX), it appreciated against the greenback during the session by N5.28 or 0.38 per cent to quote at N1,366.23/$1 versus Thursday’s closing price of N1,371.51/$1.
It also improved its value against the Pound Sterling in the official market on Friday by N21.81 to settle at N1,812.99/£1 compared with the previous day’s N1,834.80/£1, and gained N13.86 against the Euro to sell at N1,568.03/€1 versus N1,581.89/€1.
Pressure eased further on the FX market as the Central Bank of Nigeria (CBN) continued interventionist operations this week, selling Dollars to banks to boost liquidity after a $500 million boost last week.
This was complemented by inflows from foreign investors, exporters and non-bank corporates, among others, while Nigeria’s gross external reserves remained above $50 billion, the highest since 2009.
The Governor of the apex bank, Mr Yemi Cardoso, also eased fears of a Naira devaluation, saying the country’s financial system has been strengthened by reforms.
Regardless, external pressure looms as the US Dollar strengthened globally due to its war with Iran, now ongoing for three weeks.
Meanwhile, the cryptocurrency market was largely down as traders and investors continue to align with current realities.
The market is adapting to the conflict in real time. Early in the war, every headline produced an outsized reaction because nobody could price the tail risk. Now, traders have a framework where strikes happen, oil spikes and bitcoin dips only to recover again.
Cardano (ADA) depreciated by 3.8 per cent to $0.2623, Dogecoin (DOGE) lost 1.7 per cent to finish at $0.0948, Ripple (XRP) slumped 1.5 per cent to $1.39, Solana (SOL) dropped 1.4 per cent to sell for $87.33, Binance Coin (BNB) went down by 1.3 per cent to $653.58, Bitcoin (BTC) declined by 1.1 per cent to $70,670.63, and Ethereum (ETH) decreased by 0.9 per cent to $2,078.78.
However, TRON (TRX) appreciated by 1.7 per cent to $0.2941, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.
By Adedapo Adesanya
The price of the major crude oil grade, Brent crude oil, closed above $100 on Friday for the second consecutive session, as the Iran war heads toward its third week, with oil tanker traffic through the Strait of Hormuz still effectively at a standstill.
It gained 2.67 per cent or $2.68 during the trading day to close at $103.14 per barrel, while the US West Texas Intermediate (WTI) crude oil grade appreciated by 3.11 per cent or $2.98 to settle at $98.71 per barrel.
Brent futures were up about 10 per cent for the week following the 27 per cent rise seen last week, which marked the biggest weekly gain in oil prices since the COVID-19 pandemic in 2020. WTI futures, which saw their best week since 1983 last week, ended the week more than 8 per cent higher.
US President Donald Trump said American forces launched a major bombing raid on Iran’s strategic Kharg Island, targeting military facilities on the key Persian Gulf outpost while warning Iran that its vital oil infrastructure could be destroyed if shipping in the Strait of Hormuz is disrupted.
The terminal accounts for roughly 90 per cent of Iranian crude shipments, loading millions of barrels per day onto tankers bound largely for Asian markets.
The US and Israel’s strikes in the conflict have largely targeted Iranian military and nuclear infrastructure. Oil facilities elsewhere in Iran have been hit, but Kharg’s massive storage tanks, jetties, and pipelines had remained untouched until the latest strike.
Iran’s new supreme leader, Mojtaba Khamenei, vowed to keep fighting in a message delivered via state television.
There have been a number of attacks on foreign ships in or near the Strait, feeding into concerns that a prolonged war could translate to a global economic shock.
Prices are rising despite the US and its allies rolling out some measures to keep a lid on energy costs.
The International Energy Agency (IEA) has agreed to release 400 million stockpiled barrels, the largest such action in history.
The US has issued a 30-day waiver for India to purchase sanctioned oil from Russia. President Donald Trump is considering loosening rules under the Jones Act that require American ships to transport goods between domestic ports, including oil and gas, in an effort to lower costs.
Traders are continuing to monitor developments in the Middle East.
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