Economy
6 Important Things to Consider Before Trading Forex
Forex or foreign exchange is the largest capital market in the world. The average daily trading volume of the forex market is more than 6.6 trillion USD. This is much more than the average daily trading volume of global stock markets.
The significant rise in the number of forex traders since the start of the COVID-19 pandemic has boosted the trading figures remarkably, with most of the brokers have reported their highest trading volumes in 2020 & 2021.
Nigeria, South Africa, and Kenya are countries that have witnessed the highest increase in participation from retail traders in Africa.
One of the main reasons for growth is the ease of access with which these Trading apps are available. A major percentage of the young traders have traded forex & other instruments via mobile apps.
Forex currency pairs are available to trade in Nigeria through various online forex brokers. These brokers offer easy-to-use trading platforms & apps for newbies with an interface that encourages trading. This is not really a good situation as it promotes reckless trading too.
Also, due to a substantial rise in the demand for online forex brokers, the scammers and conmen have also utilized the opportunity to scam the uninformed and inexperienced traders. Forex trading scams are at an all-time high throughout Africa and traders need to consider certain aspects before choosing a forex broker in Nigeria.
Here are some things to consider before you trade forex.
1. Regulation
Retail forex trading via online brokers is unregulated in Nigeria.
The Securities and Exchange Commission of Nigeria (SEC) has issued several warnings about the risk involved in trading forex. However, it is not illegal to trade CFDs & forex online in Nigeria.
Trading forex in Nigeria is not illegal but traders are doing so at their own risk. As forex is not yet regulated in Nigeria, individuals involved in forex trading need to take more precautionary measures and choose wisely.
No local regulatory authority in Nigeria regulates or overlooks the forex market and the activities of the forex brokers. Some of the major forex brokers in Nigeria have regulations from top-tier authorities like FCA of the UK, FSCA of South Africa, and ASIC of Australia. However, some forex brokers in Nigeria do not have any regulatory license or are only licensed through offshore regulators. Such Offshore brokers with no licenses are more likely to be fake and must be avoided.
In case of lack of regulation in Nigerian, Broker’s regulation from top-tier regulatory authorities ensures the safety of your funds. Any malpractice or complaint against a regulated broker can be reported to the regulatory authority.
Past records of registered complaints can also be checked for the regulated brokers. Every regulatory license of the forex broker will have a license number that can also be cross-checked from the regulatory authority for authenticity.
Trading forex in Nigeria via an offshore broker can be very risky as no complaint can be registered in case of deceit. This increases the third-party risk substantially making forex trading even riskier.
2. Scams Related to Forex & Investments
It is important to have a look at the types of scams that have been committed against investors in Nigeria. The recent scam MBA Trading Limited had estimated to have cost unsuspecting investors Billions of Naira.
Most of these scams in general have nothing to do with the forex & other capital markets but are scammers and conmen taking duping inexperienced investors.
Scams related to the forex and cryptocurrency market are at an all-time high in Nigeria. Traders need to take every possible measure to avoid falling into the traps of scammers.
Many fake agents or brokers may reach you with unsolicited investment advisory and force you to make quick deposits. They may gain your interest by promising unrealistic returns and illogically low-risk factors. Traders and investors must know where their hard-earned money is going and what are the risks associated with it.
Traders and investors in Nigeria must ensure the authenticity of the regulatory license held by the broker. The chosen forex broker must have at least one top-tier regulatory license. This greatly reduces the chances of scams by the broker and ensures safety.
Besides checking the license, traders must also stay aware and look out for red flags that signal a scam. Common red flags include delaying withdrawal, forcing to buy or sell, changing fees, asking for too many documents, etc.
3. Currency Pairs
Forex trades can only be executed with a pair of currencies. One currency in the pair is bought and sold while the other is exchanged in return for the purchase or sale of the pair.
For example, in EUR/USD currency pair, EUR can be bought or sold in return for USD. Or vice versa.
The price movement in each of the currency pairs depends on different factors which need to be analyzed fundamentally and technically. All the factors that can affect the prices of currency pairs need to be well understood before dealing with them.
The micro and macro-economic factors, geopolitical factors, inflation, and many more aspects of the countries need to be looked out before trading any currency.
Many newcomers in the market seek for the most volatile currency pairs to make quick returns or the ones that are traded the most or suggested by someone. Currency pairs in forex trading must only be selected after detailed inspection and analysis of price movement. Trading with unknown instruments without analysis or understanding is similar to gambling that includes a high risk of losing.
4. Leverage and Margin Trading
Leverage is a feature offered by forex brokers that allow traders to open bigger position with a smaller deposit. This allows them to gain high returns but if the price moves against the anticipation, the loss can be much severe.
In many situations, traders can lose all the deposited amounts due to high leverage. The amount required in the account to open a position is called margin money.
For example, a broker offers a leverage of 1:500 in Nigeria. To open a buy position on 1 standard lot (i.e., 100,000 units), the trader requires only $200. If the price moves up by 10 pips, profits will be $100 but if it moves down by 10 pips then the loss will be $100, which is 50% of your capital.
Some brokers offer negative balance protection in which positions are automatically closed if the account balance reaches zero. Trading with brokers that do not offer negative balance protection is riskier as the account balance can go in negative.
Higher leverage can increase profits with lower deposits but it also increases the risk factor exponentially. Leverage in forex trading should only be used with the proper understanding of its consequences, and you must never use more than 1:20 leverage on forex.
5. Trading Strategy and Planning
Forex trading requires planning and a lot of research. Experienced traders always follow a trading strategy and keep improvising it to increase success rates, and their wins when they are correct in their analysis.
Trading without a plan and strategy is similar to searching for treasure without a map. Trading without planning is gambling with very high risk due to leverage.
The analysis of forex price movement can be done fundamentally and technically. Using analysis techniques can provide better trading ideas and increase success rates in trading.
Traders in Nigeria should make a financial plan with a realistic objective and develop strategies that can help in achieving the objective. Most of the new traders unlike experienced traders lack the discipline to follow a particular trading strategy or plan.
Traders must remain emotionally strong and take decisions according to financial objectives and analytical judgment. Trading decisions driven by emotion or unsolicited advisory must be avoided.
You should not choose the broker or trading instrument just because your friend or a family member has chosen it.
6. Demo Account
The strategies can be developed and tested before implementation with real currency.
Most forex brokers and fintech websites offer a demo forex trading account where new as well as experienced traders can test their strategies with virtual currency.
These demo accounts are available for free and can also allow traders to know which market or instrument is good for them. The demo account can also help you learn & understand basic terminologies, use Risk management features like stop-loss, limit order, etc.
The risk involved in the capital markets and the possible amount that can be gained or lost can also be calculated.
By Adedapo Adesanya
The supply of Premium Motor Spirit (PMS), also known as petrol, increased by 55.4 per cent on a month-on-month basis to 71.5 million litres per day in November 2025 from 46 million litres per day in October.
This was contained in the November 2025 fact sheet of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) on Monday.
The data showed that the nation’s consumption also increased by 44.5 per cent or 37.4 million litres to 52.1 million litres per day in November 2025, against 28.9 million litres in October.
The significant increase in petrol supply last month was on account of the imports by the Nigerian National Petroleum Company (NNPC) Limited into the Nigerian market from both the domestic and the international market.
Domestic refineries supplied in the period stood at 17.1 million litres per day, while the average daily consumption of PMS for the month was 52.9 million litres per day.
The NMDPRA noted that no production activities were recorded in all the state-owned refineries, which included Port Harcourt, Warri, and Kaduna refineries, in the period, as the refineries remained shut down.
According to the report, the imports were aimed at building inventory and further guaranteeing supply during the peak demand period.
Other reasons for the increase, according to the NMDPRA, were due to “low supply recorded in September and October 2025, below the national demand threshold; the need for boosting national stock level to meet the peak demand period of end of year festivities, and twelve vessels programmed to discharge into October, which spilled into November.”
On gas, the average daily gas supply climbed to 4.684 billion standard cubic feet per day in November 2025, from the 3.94 bscf/d average processing level recorded in October.
The Nigeria LNG Trains 1-6 also maintained a stable processing output of 3.5 bscf/d in November 2025, but utilisation improved slightly to 73.7 per cent compared with 71.68 per cent in October.
The increase, according to the report, was driven by higher plant utilisation across processing hubs and steady export volumes from the Nigeria LNG plant in Bonny.
“As of November 2025, Nigeria’s major gas processing facilities recorded improved output and utilisation levels, with the Nigeria LNG Trains 1-6 processing 3.50 billion standard cubic feet per day at a utilisation rate of 73.70 per cent.
“Gbaran Ubie Gas Plant processed 1.250 bscf per day, operating at 71.21 per cent utilisation, while the MPNU Bonny River Terminal recorded a throughput of 0.690 bscf per day during the period. Processing activities at the Escravos Gas Plant stood at 0.680 bscf per day, representing a 62 per cent utilisation rate, whereas the Soku Gas Plant emerged as the top performer, processing 0.600 bscf per day at 96.84 per cent utilisation,” it stated.
By Aduragbemi Omiyale
The proposed share reconstruction of a local gaming firm, Secure Electronic Technology (SET), has been suspended.
The Lagos-based company decided to shelve the exercise after negotiations with potential investors crumbled like a house of cards.
Secure Electronic Technology was earlier in talks with some foreign investors interested in the organisation.
Plans were underway to restructure the shares of the company, which are listed on the Nigerian Exchange (NGX) Limited.
However, things did not go as planned as the potential investors pulled out, leaving the board to consider others ways to move the firm forward.
Confirming this development, the company secretary, Ms Irene Attoe, in a statement, said the board would explore other means to keep the company running to deliver value to shareholders.
“This is to notify the NGX and the investing public that a meeting of the board of SET held on Tuesday, December 16, 2025, as scheduled, to consider the status of the proposed share reconstruction and recapitalisation as approved by the members at the Extraordinary General Meeting (EGM) held on April 16, 2025.
“After due deliberations, the board wishes to announce that the proposed share reconstruction will not take place as anticipated due to the inability of the parties to reach a convergence on the best and mutually viable terms.
“Thus, following an impasse in the negotiations, and the investors’ withdrawal from the transaction, the board has, in the interest of all members, decided to accept these outcomes and move ahead in the overall interest of the business.
“The board is committed to driving the strategic objectives of SEC and to seeking viable opportunities for sustainable growth of the company,” the disclosure stated.
Business Post reports that the share price of SET crashed by 3.85 per cent on Tuesday on Customs Street on Tuesday to 75 Kobo. Its 52-week high remains N1.33 and its one-year low is 45 Kobo. Today, investors transacted 39,331,958 units.
By Adedapo Adesanya
Clea, a blockchain-powered platform that allows African importers to pay international suppliers in USD while settling locally, has officially launched.
During its pilot phase, Clea processed more than $4 million in cross-border transactions, demonstrating strong early demand from businesses navigating the complexities of global trade.
Clea addresses persistent challenges that African importers have long struggled with, including limited FX access, unpredictable exchange rates, high bank charges, fraudulent intermediaries, and payment delays that slow or halt shipments. The continent also faces a trade-finance gap estimated at over $120 billion annually, limiting importers’ ability to access the FX and financial infrastructure needed for timely international payments by offering fast, transparent, and direct USD settlements, completed without intermediaries or banking bottlenecks.
Founded by Mr Sheriff Adedokun, Mr Iyiola Osuagwu, and Mr Sidney Egwuatu, Clea was created from the team’s own experiences dealing with unreliable international payments. The platform currently serves Nigerian importers trading with suppliers in the United States, China, and the UAE, with plans to expand into additional trade corridors.
The platform will allow local payments in Naira with instant access to Dollars as well as instant, same-day, or next-day settlement options and transparent, traceable transactions that reduce fraud risk.
Speaking on the launch, Mr Adedokun said, “Importers face unnecessary stress when payments are delayed or rejected. Clea eliminates that uncertainty by offering reliable, secure, and traceable payments completed in the importer’s own name, strengthening supplier confidence from day one.”
Mr Osuagwu, co-founder & CTO, added, “Our goal is to make global trade feel as seamless as a local transfer. By connecting local currencies to global transactions through blockchain technology, we are removing long-standing barriers that have limited African importers for years.”
According to a statement shared with Business Post, Clea is already working with shipping operators who refer merchants to the platform and is also engaging trade associations and logistics networks in key import hubs. The company remains fully bootstrapped but is open to strategic investors aligned with its mission to build a trusted global payment network for African businesses.
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