Economy
Navigating the Complex World of Investing: What Novices Need to Know
Have you finally decided to take the leap into the exciting arena of investing? Not only is this an excellent way to secure a lucrative nest egg for the future, but many have begun to use these opportunities as a springboard for their businesses.
However, appreciating the intricacies of online trading is no easy task. A great deal of preparation will be required and mistakes can occur on occasion. This is why knowing where to begin is one of the best ways to establish strong foundations. Let us therefore cut through a fair amount of “fluff” and examine a handful of strategies that have already been embraced by experts.
Determine How Much You Can Comfortably Afford to Invest
Comfort is king (and queen) in terms of investing. It is always prudent to establish how much you can afford to trade at any given time. You might otherwise stretch your finances too thin and suffer from a lack of liquidity (especially if you have become involved with long-term positions).
Many experts recommend placing no more than ten percent of your available capital into an investment at any given time. Even if losses do occur, you will not be placed in fiscal jeopardy. This also helps to avoid mistakes that can be made when trading based on emotions as opposed to pragmatism and logic.
Consistency is Key
As opposed to other online articles that you might have encountered from time to time, the chances of becoming a millionaire overnight are virtually non-existent. Any successful investor understands that accruing liquidity requires time and effort. This is when the power of consistency comes into play. Set a trading schedule and stick to it. One novel way to develop this level of clarity is to employ an economic calendar. These handy tools will enable you to prioritise specific positions and to appreciate how your individual investments are performing from a longitudinal perspective.
Balance Your Portfolio
All of us aim to achieve a balanced lifestyle and this is just as relevant in terms of investing. Any type of trading portfolio should hold a number of different asset classes at any give time. Examples include traditional stocks, commodities… Even if one asset happens to perform poorly, the gains associated with others can be used to mitigate any potential losses. This is sometimes referred to as “hedging” within financial circles. It may also be wise to work in tandem with a third-party wealth management firm. These companies will provide targeted recommendations based on your short- and long-term goals. Thus, it can serve as a helping hand even for expert investors.
Set Realistic Milestones
What is it that you are ultimately trying to achieve? Are you solely interested in short-term profits or might you instead wish to develop a well-rounded retirement package? Note that clearly establishing your goals will have a profound impact upon the types of investments that you make as well as the most appropriate asset classes. For instance, those who view their investments from a multi-year perspective might gravitate toward holdings such as shares in Apple or precious metals, as they normally are more stable than other alternatives.
Having said this, be realistic with your goals. Appreciate that even seasoned veterans have accrued wealth over decades as opposed to relying upon luck or the movement associated with a handful of trades. Establishing practical milestones will also enable you to gauge your progress and to make any changes that may be warranted. This likewise brings us to the final point.
View Errors as Learning Experiences as Opposed to Setbacks
Experts such as Warren Buffett are well aware of the fact that errors can and will emerge from time to time. Novice investors are essentially left with two choices. They can either walk away from a position or use the scenario to further hone their talents. Mistakes represent some of the most lucrative learning opportunities if viewed in a constructive manner, even if it sounds too difficult to understand just after they were made.
As more people begin to understand the advantages that online investing can offer, we should expect to witness an influx of younger traders who are eager for success. Still, Rome was not built in a day. The good news is that there are countless resources to be found across the Internet if you are keen to learn more. Furthermore, do not hesitate to bookmark this article for future reference if desired.
By Adedapo Adesanya
Three bellwether stocks lifted the NASD Over-the-Counter (OTC) Securities Exchange by 0.62 per cent on Friday, December 12 with the NASD Unlisted Security Index (NSI) jumping by 22.20 points to 3,600.43 points from 3,578.23 points.
In the same vein, the market capitalisation of the trading platform increased by N13.28 billion to close at N2.154 trillion from the previous day’s N2.140 trillion.
During the session, Central Securities Clearing System (CSCS) Plc went up by N2.53 to close at N39.71 per share compared with the previous day’s N37.18 per share, Geo-Fluids Plc added 35 Kobo to its price to finish at N5.00 per unit versus Thursday’s closing price of N4.65 per unit, and FrieslandCampina Wamco Nigeria Plc appreciated by 23 Kobo appreciation to sell at N60.23 per share versus N60.00 per share.
It was observed that yesterday, the price of Golden Capital Plc went down by N1.05 to N9.45 per unit from N10.50 per unit, and UBN Propertiy Plc declined by 21 Kobo to N2.01 per share from the N2.22 per share it was traded a day earlier.
There was a significant improvement in the level of activity for the day, as the volume of transactions increased by 6.2 per cent to 37.4 million units from the previous day’s 35.2 million units, the value of trades went up by 265.1 per cent to N4.9 billion from N1.4 billion, and the number of deals soared by 13.80 per cent to 33 deals from 29 deals.
Infrastructure Credit Guarantee Company (InfraCredit) Plc ended the last trading day of this week as the most active stock by value on a year-to-date basis with 5.8 billion units valued at N16.4 billion, the second spot was taken by Okitipupa Plc with 178.9 million units traded for N9.5 billion, and third space was occupied by a new comer in MRS Oil Plc with 36.1 million units worth N4.9 billion.
InfraCredit Plc also finished the session as the most active stock by volume on a year-to-date basis with 5.8 billion units transacted for N16.4 billion, followed by Industrial and General Insurance (IGI) Plc with 1.2 billion units valued at N420.3 million, and Impresit Bakolori Plc with 537.0 million units sold for N524.9 million.
By Dipo Olowookere
The bullish run on the Nigerian Exchange (NGX) Limited continued on Friday with a further 1.00 per cent growth buoyed by gains recorded by Guinness Nigeria, Champion Breweries, and others.
Data showed that the consumer goods space expanded by 1.53 per cent during the last trading session of the week, as the insurance counter grew by 0.51 per cent, and the industrial goods sector marginally gained 0.01 per cent.
However, the banking index depreciated by 0.54 per cent due to a pocket of profit-taking, and the energy industry shrank by 0.09 per cent, while the commodity sector closed flat.
Guinness Nigeria gained 10.00 per cent to trade at N217.80, Morison Industries rose by 9.84 per cent to N4.69, Champion Breweries jumped by 9.69 per cent to N14.15, Austin Laz grew by 9.66 per cent to N2.27, and C&I Leasing appreciated by 9.62 per cent to N5.70.
Conversely, eTranzact lost 10.00 per cent to finish at N12.60, Chellarams slumped by 9.00 per cent to N13.20, Eunisell depleted by 9.89 per cent to N75.15, Africa Prudential moderated by 9.77 per cent to N12.00, and DAAR Communications decreased by 9.18 per cent to 89 Kobo.
The busiest stock on Friday was Access Holdings with 107.6 million units sold for N2.2 billion, Consolidated Hallmark traded 59.9 million units worth N245.8 million, Zenith Bank transacted 48.2 million units valued at N3.1 billion, Transcorp Power transacted 42.8 million units for N13.1 billion, and Champion Breweries exchanged 36.4 million units valued at N510.2 million.
At the close of business, a total of 602.8 million units worth N30.7 billion exchanged hands in 20,550 deals yesterday, in contrast to the 529.7 million units valued at N12.3 billion traded in 18,159 deals on Thursday, representing a surge in the trading volume, value, and number of deals by 13.80 per cent, 149.59 per cent, and 13.17 per cent apiece.
Business Post reports that the All-Share Index (ASI) soared during the session by 1,485.89 points to 149,436.48 points from 147,950.59 points and the market capitalisation moved up by N945 billion to N95.264 trillion from N94.319 trillion.
By Adedapo Adesanya
An intervention of the Central Bank of Nigeria (CBN) in the foreign exchange (FX) market eased the pressure on the Naira on Friday.
The apex bank sold forex to banks and other authorised dealers in the official window to defend the domestic currency, helping to calm the FX demand pressure, with the Nigerian currency appreciating against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) by 0.11 per cent or N1.57 to sell at N1,454.50/$1 compared with Thursday’s closing price of N1,456.07/$1.
Also, the domestic currency improved its value against the Pound Sterling in the official market yesterday by N3.95 to close at N1,946.15/£1 versus the previous day’s N1,950.11/£1 but lost 10 Kobo on the Euro to quote at N1,706.46/€1 compared with the N1,706.36/€1 it was exchanged a day earlier.
At the black market segment, the Nigerian Naira maintained stability against the Dollar during the session at N1,470/$1 and also traded flat at N1,463/$1 at the GTBank forex counter.
Despite the sigh of relief, demand pressures outweighed the robust supply from the CBN and inflow from offshore players looking to participate at the OMO bills auction.
Gross FX reserves increased for the twenty fifth consecutive week, growing by a strong $396.84 million week-on-week to $45.44 billion.
As for the cryptocurrency market, it was down on Friday as pressure remained after Federal Reserve chair Jerome Powell’s speech on Wednesday, which hinted at a possible rate cut pause in January. As a result, markets now expect only two rate cuts in 2026 instead of three.
However, Chicago Federal Reserve President Austan Goolsbee, who was against a December rate cut, said he expects more in 2026 than the current median projection.
Ethereum (ETH) slumped by 5.1 per cent to $3,090.61, Solana (SOL) declined by 4.5 per cent to $132.79, Cardano (ADA) depreciated by 3.8 per cent to $0.4103, and Dogecoin (DOGE) dropped 2.5 per cent to trade at $0.1373.
In addition, Bitcoin (BTC) lost 2.4 per cent to sell at $90,342.74, Litecoin (LTC) tumbled by 1.9 per cent to $81.86, Binance Coin (BNB) fell by 0.6 per cent to $886.93, and Ripple (XRP) slipped by 0.5 per cent to $2.02, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 each.
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