How to Invest in Stocks: 10 Steps to Start Investing

If you look at the data, over the past 20-years, if you have invested in the broad market portfolio on the last trading day of every month, you would have realized an annual percentage yield of 10%. In simple English, an investment of N100 thousand on the last day of every month in the lastContinue reading “How to Invest in Stocks: 10 Steps to Start Investing”

Monitor Your Investments

Perhaps the biggest disservice you can do to yourself with regards to achieving your investment goals, is to spend so much time planning your portfolio, so much money building your portfolio and then not monitor it. Investing is not an end unto itself, but rather a means to an end for most people i.e. investingContinue reading “Monitor Your Investments”

Keep an eye on fees and transaction costs

All investments have a cost, as they say, you have to spend money to make money. Those fees and charges can make or mar your investment. For instance, of what benefit is investing in an asset with an expected return of 10% when inflation is 8% and transaction fees are 3%. Your net return afterContinue reading “Keep an eye on fees and transaction costs”

Rebalance Your Portfolio

Assuming you have your portfolio in place, and perhaps regularly adding to it, you will see that your asset allocation will move away from the set ratios and this is because the assets would grow at different rates. Hence, the need to rebalance. Rebalancing is simply your attempt to keep your portfolio in line withContinue reading “Rebalance Your Portfolio”

Asset Allocation – How to mix your investments

This is where the rubber meets the road as far as getting your investment portfolio diversified. Asset allocation refers to the mix of investments you hold between different assets – equities (stocks), fixed income (bonds), real estate and cash – that fit your goals and risk level. A sound asset allocation strategy ensures your investmentContinue reading “Asset Allocation – How to mix your investments”

What is a stock

Shares, also known as stocks or equities, are a piece of the ownership interests in a company. When establishing a company, the owners would typically have to raise money investors who then in return get some shares. As such, a share is divided-up unit of the value of a company. At inception, most companies haveContinue reading “What is a stock”

How to invest in shares

Often, when a company floats it shares on the stock exchange for the first time, it does so via an initial public offering (IPO). In this instance, you are able to invest in the shares of the company by completing the application form and making necessary payments. This was common during the stock market boomContinue reading “How to invest in shares”

Why buy stocks

Broadly, there are two categories of people that buy stocks; investors and speculators. The latter are mostly interested in buying a stock because they believe they have the skill to detect a mispricing in the stock i.e. they buy the stock at a low price and sell when it goes up. Typically, this is justContinue reading “Why buy stocks”