Economy
How to Build an Investment Portfolio
By FBNQuest
Every investor who desires to build and grow wealth should have an investment portfolio. Wealth creation efforts are less likely to succeed if they are approached haphazardly, so building an investment portfolio is a great way to add the necessary strategy and intention to these efforts.
An investment portfolio, simply defined, is a collection of all the assets an investor owns. It can be likened to a roof under which you house all your investments. A good investment portfolio will be diversified and contain a wide variety of assets such as stocks, bonds, mutual funds, real estate, fine art, gold etc.
Types of Investment Portfolios
There are five major types of investment portfolios and they are built by taking the financial goals and risk appetite of the investor into consideration.
The Aggressive Portfolio – This type of portfolio is specially designed for investors with a high tolerance for risk. Investments that fall under this category are high risk but also have the potential to yield high returns. High beta stocks are an example of this kind of asset. They are more volatile and experience a greater fluctuation in price when compared to the overall market.
The Defensive Portfolio – This category is for people who have a low-risk appetite. Building a defensive portfolio usually involves investing in stocks of companies that will stay in business no matter what. These are companies that make products that are important for everyday survival.
The Income Portfolio – The goal of an income portfolio is to generate positive cash flow. This includes stocks that pay regular dividends and provide a steady source of income for the investor. An income portfolio can serve as a great supplement to an investor’s salary or retirement income.
The Speculative Portfolio – This portfolio is also tailored to an investor with a high-risk tolerance. It basically involves pre-empting which stocks are likely to do well. An example of speculative investment is an initial public offering (IPO) of a new tech company. Financial advisors usually advise investors against putting more than 10 per cent of their investment funds into such assets.
The Hybrid Portfolio – The hybrid portfolio, as the name implies, is a combination of different assets. This portfolio encourages diversification and provides the investor with a diversified portfolio which can include stocks, mutual funds, bonds, commodities, real estate, and even art. This portfolio category comes with the advantage of flexibility for the investor; it also reduces the negative impact of losses from one asset class.
How to start building an investment portfolio
Building an investment portfolio can seem like an uphill task, but it does not have to be. The first step is to identify your financial goals. As Bloomberg financial analyst and Chief Investment Officer of Ritholtz Wealth Management LLC, Barry Ritholtz aptly points out: “When it comes to investing, there is no such thing as a one-size-fits-all portfolio.”
Identifying your unique goals will determine if your money should go into short-term or long-term investments. It will also predict what kind of portfolio would be best suited to your needs. A portfolio tailored towards retirement will be different from one that is intended to provide income within the next five years.
It is also important to assess your risk tolerance. If you are risk-averse, this means you are careful about putting your money at risk for promising rewards. Therefore, your money should be invested as safely and predictably as possible. However, if you have a high tolerance for risk, you are open to taking risks for the possibility of making greater returns.
Once this is completed, you would need to honestly examine your investing skills, to establish whether you can build a portfolio yourself or would require the support of a Financial Adviser.
The next step is to decide on asset allocation. How much of your money will go into each investment? How do you plan to balance your portfolio and continue to diversify as time goes on? These are all questions that must be answered and it’s advisable to seek the help of a professional for this stage of the process.
In conclusion, the major keys to keep in mind when building an investment portfolio are to identify your goals, assess your risk appetite and talk to an expert. Ready support is available to you, as FBNQuest offers a variety of investment products and is available to offer advice to investors based on their risk appetite.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange weakened further by 1.75 per cent on Tuesday, August 18, triggered by losses recorded by the duo of Central Securities Clearing System (CSCS) Plc and Food Concepts Plc.
CSCS Plc, the Nigerian securities depository company, lost N8.48 to settle at N90.02 per share compared with the previous value of N98.50 per share, while Food Concepts Plc, the parent company of fast food franchise, Chicken Republic, dropped 15 Kobo to end at N2.35 per unit versus N2.50 per unit.
Consequently, the NASD Security Index (NSI) further declined by 77.26 points to 4,348.76 points from Monday’s 4,426.02 points, while the market capitalisation dipped by N46.37 billion to N2.610 trillion from N2.656 trillion.
During the session, the volume of securities bought and sold by investors slumped by 82.6 per cent to 113,728 units from the previous session’s 652,081 units, and the value of securities slid by 12.4 per cent to N9.4 million from the preceding day’s N10.7 million, while the number of deals increased by 47.6 per cent to 31 deals from 21 deals.
Great Nigeria Insurance (GNI) Plc remained the most active stock by value on a year-to-date basis, with 3.4 billion units traded for N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units sold for N6.5 billion, and CSCS Plc with 79.7 million units transacted for N5.8 billion.
GNI Plc was also the most traded stock by volume on a year-to-date basis, with 3.4 billion units valued at N8.4 billion, trailed by Infracredit Plc with 2.3 billion units worth N6.5 billion, and Resourcery Plc with 1.1 billion units exchanged for N415.7 million.
By Adedapo Adesanya
The value of the Nigerian Naira further appreciated against the US Dollar by N6.22 or 0.46 per cent in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Tuesday, August 18, to N1,343.32/$1 from the previous rate of N1,349.54/$1.
This occurred amid steady growth in Nigeria’s external reserves, rising to $52.32 billion as of August 17, 2026, giving the Central Bank of Nigeria (CBN) enough arsenal to defend the local currency when the need arises in the FX market.
Also, the domestic currency improved its value against the Pound Sterling in the official market yesterday by N10.85 to close at N1,819.26/£1 compared with the previous day’s N1,830.11/£1, and gained N8.55 on the Euro to sell at N1,556.24/€1 versus Monday’s N1,564.79/€1.
In the same vein, the Naira appreciated against the Dollar in the black market during the trading session by N5 to quote at N1,390/$1, in contrast to the N1,395/$1 it was traded a day earlier, and strengthened at the GTBank forex desk by N7 to N1,357/$1 from N1,364/$1.
NAFEM interbank FX turnover declined as financial institutions’ activities moderated. Interbank FX turnover dropped by 16.6 per cent to $364.709 million from $437.529 million, with the number of deals down by 39.3 per cent to 108 deals from 178 deals.
As for the cryptocurrency market, Bitcoin (BTC) traded at $64,120.36, as most other major cryptocurrencies closed in the green amid a global selloff in chip stocks.
An Asian semiconductor gauge dropped more than 3 per cent, following a 5 per cent slide in the Philadelphia Semiconductor Index on Tuesday, its worst session since late July, while investors await US Federal Reserve minutes and are widely expecting no rate change in September.
Solana (SOL) gained 1.4 per cent to sell at $76.66, Cardano (ADA) added 0.9 per cent to trade at $0.1748, Ethereum (ETH) grew by 0.6 per cent to $1,905.54, Ripple (XRP) appreciated by 0.4 per cent to sell at $0.9986, TRON (TRX) improved by 0.3 per cent to $0.3327, and Dogecoin (DOGE) soared by 0.2 per cent to $0.0698.
However, Binance Coin (BNB) depreciated by 0.4 per cent to $600.88, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited has recently struggled to regain its spark due to continued selling pressure from investors reducing their exposure to equities in favour of fixed-income investment instruments.
Yesterday, the stock market further shed 0.35 per cent on the back of profit-taking in the banking sector, which closed lower by 1.83 per cent. The consumer goods space lost 0.13 per cent, and the energy counter depreciated by 0.01 per cent, while the insurance index gained 0.04 per cent, with the industrial goods segment closing flat.
Business Post reports that the All-Share Index (ASI) decreased on Tuesday by 843.42 points to 241,611.23 points from 242,454.65 points, and the market capitalisation shrank by N545 billion to N155.973 trillion from N156.518 trillion.
Like the previous session, investor sentiment was weak after Customs Street ended with 22 price gainers and 37 price losers, indicating a negative market breadth index.
Red Star Express weakened by 10.00 per cent to N16.20, Trans-Nationwide Express crashed by 9.94 per cent to N2.81, Meyer depleted by 9.88 per cent to N15.05, Chellarams plunged by 9.77 per cent to N9.70, and Fortis Global Insurance moderated by 9.70 per cent to N2.14.
On the flip side, Haldane McCall surged by 9.97 per cent to N3.20, Veritas Kapital climbed by 7.09 per cent to N1.36, Tantalizers rose by 5.26 per cent to N4.00, RT Briscoe appreciated by 4.31 per cent to N10.90, and Regency Alliance grew by 3.66 per cent to 85 Kobo.
A look at the activity chart for the day showed the volume of transactions significantly retreated by 66.94 per cent as a result of the absence of big-ticket trades, and the number of deals dropped by 21.57 per cent, while the value of trades increased by 20.09 per cent.
Market participants traded 429.8 million stocks valued at N27.5 billion in 35,683 deals during the session compared with the 1.3 billion stocks worth N22.9 billion transacted in 45,494 deals on Monday.
Sterling Holdings led the activity chart with a turnover of 51.6 million units for N390.6 million. FCMB traded 50.0 million units worth N584.8 million, Chams sold 32.4 million units valued at N134.5 million, Veritas Kapital exchanged 180 million units for N24.3 million, and First Holdco transacted 17.0 million units worth N2.2 billion.
