Here is Everything You Should Know About FGN Savings Bond

How to Invest in FGN Bonds in Nigeria – Everything You Should Know About FGN Savings Interest Rates & Current Yields Including How it Works and Get Started

If you have been receiving emails from your stockbrokers on latest FGN savings bond but don’t understand bond as a fixed income investment, here is a simple explanation and detailed guide on how it works, including steps to invest in FGN bond.

FGN Bond is a bond issued by the Nigerian government in exchange for cash at a given interest rate and a repayment period. It also states how payments of the principal and interest will be made. A bond is a confirmation from a borrower that it borrowed money from a lender at a given interest rate and repayable over a period. They also include a minimum amount that can be subscribed to by the lender and in what multiples.

The FGN bond is a major source of finance for capital projects; otherwise known as longterm infrastructural investments. This is the reason bond tenors span for up to 20 – 30 years.

Why you should invest in FGN savings bond

When you invest in the FGN bond, you earn a passive interest income that will be paid quarterly directly into your savings or current bank account. Interestingly, you really do not need to have millions in your bank account to invest as anyone with as little as N5,000 can invest in the bond.

Continue reading Here is Everything You Should Know About FGN Savings Bond

4 Short-Term Investment Apps That Offer Higher Interest Rates Than Your Bank

Best Investment Apps in Nigeria – Earn Higher Interest Rates Returns Than Your Bank Fixed Deposit Accounts – Best Short-Term Investment Opportunities for Salary Earners.

I have some cash I will like to save and hold for 6-12 months but don’t want to keep it in my savings account, what are the risk-free options I can explore to earn a high-interest return above my conventional savings account rate of 2-3%? 

If you have asked a similar question, and are still looking for the best answer, this is for you, pay attention to the information shared, this might be one of your best short term investment guides this year.

We already know that the interest on a savings account is low to the extent that they can’t keep pace with inflation (now at 11.3% as of this update), so your money loses value over time.

For some of us that don’t know how money loses value every year, Let me share a practical example of how a typical N100,000 was worth more 3-5 years ago than it is right now.

We will compare savings returns when the average inflation rate as of 2013 was 8.5% and the latest 2019 figure of 11.3%.

Assuming you kept N100,000 in the bank in a savings account which earned 3% per annum in 2013. The real value of your money isn’t N103,000 at the end of the year but N94,000 (1+3%/1+8.5%). In Finance, we call this inflation-adjusted return.

Fast forward to 2019, the same N100,000 in a savings account that offers the same return of 3% after adjusting for a high inflation rate at 11.3% will be worth N92,000 (1+3%/1.11.3%).

You see how Inflation eats away the value of every stream of cash flow, including salaries, and pension. Although, you will get the same nominal value of N100,000 or N103,000 (interest included) the value of what you can buy with it has reduced from N94,000 to N92,000, down by 2% and that is how your cash savings lose an average of 2% of its value year on year.

Continue reading 4 Short-Term Investment Apps That Offer Higher Interest Rates Than Your Bank

Where to Invest your Money & Earn Multiple Streams of Passive Income

Where to Invest your Money in Nigeria for Passive Income – High Yield Short and Long Term Financial Investment Opportunities in Real Estate and Property Development, Dividend Stocks, Treasury Bills, Fixed Deposits & Mutual Funds

Mike, a business consultant in an IT firm, often wondered how his closest colleague, Efe who was on the same executive level, with the same annual benefits and who also had the same skill and working experience could afford to migrate from his place of resident to a decent place at Lekki, buy a new Toyota Camry and even take his wife on a trip to some of the best places in Lagos and Abuja while he (Efe) was still struggling to make efficient use of his monthly pay and have some to save in a savings account.

Mike has been very smart about how we could use his salary to generate passive or side income. He didn’t just save his monthly earnings in a fixed deposit account, that earns a low-digit interest return while his money is lent to qualified corporate borrowers at a higher rate, but explored some double-digit interest return opportunities  only a few know in Nigeria, with the extra cash flow credited to his account month on month, quarter on quarter and year on year, he is on his way to achieving a total freedom from salaried job or monthly paycheck while securing his kid’s education and family’s fortune.

Continue reading Where to Invest your Money & Earn Multiple Streams of Passive Income

How Do I Invest in Treasury Bills in Nigeria?

How Do I Invest in Treasury Bills in Nigeria – Treasury Bill Rates Today in Zenith, GTBank, FirstBank, Access, Stanbic IBTC, Ecobank, Sterlings, Fidelity, Union Bank & FCMB 2019

This guide is for investors that are looking for alternative investment opportunities in the fixed income market. In my previous investing tips on where you should invest your money, I mentioned TB among other places you can grow your money.

Let’s Discuss Treasury Bills

Treasury Bills are government debt instruments issued by Central Bank of Nigeria on behalf of the former to finance expenditure. The instrument is sold through a bi-weekly auction conducted by the Central bank in Primary Market Auction. Buyers are requested to quote bids following which the average minimum bid is selected.

Steps to Buy Treasury Bills in Primary Market:

To buy Treasury Bills you will have to approach your bank requesting for a form. You fill the form with your personal information also indicating the amount you want to buy as well as your bid rate. However, with the advent of a bank’s treasury bills mobile application, buyers are only required to fill a signup form once.

Nowadays, the easiest way is through Sterlings Bank’s Treasury bill mobile app. The app is accessible to all irrespective of their bank. Gone are the days when the idea of investing in treasury bills meant owning millions in order to invest.

Continue reading How Do I Invest in Treasury Bills in Nigeria?

This Short term Investment Strategy Offers Higher Return above T-Bills

Short term Investment Opportunity in Nigeria with High Returns 2019 – Best High Yield Investment Options to Make Guaranteed Income from Nigeria Stock Market.

Short-term investments, also known as liquid investments, are investments that mature in 6 months to 1 year. Unlike long-term investments, which is believed to offer higher yield over time, short-term investments typically come with lower risks, no wonder the returns are smaller.

When it comes to selecting the best options for your money, there is countless advice on why and how investing in long-term securities will help you accumulate wealth. But in the course of our day to day financial life, we frequently find ourselves in need of short-term cash flows to finance immediate needs which is why we must also seek investment opportunities that won’t take decades to build up and yet offer steady, low-risk and guaranteed return.

Ordinarily, the deposit account and CBN Treasury Bills are not only considered the best ideas but had been the widely adopted short-term investment options for amateur investors. But, the statistically-proven idea shared here will help you maximize the return on the cash in your savings account.

Although, you can’t rule out the risk involved, the combination of market timing and some level of exposure to government-backed securities will surely lower your risk. The average return on your investment can vary from 15% to30% in a 5-6 months

Who is this strategy suitable for:

  • Folks with idle cash in the bank
  • Folks that are looking for high return opportunities and at the same want to preserve their capital.
  • Folks that can invest now and wait for 6-12 months before exit.

Best Short-term Investment Opportunities with Higher Return

The two best investment options are Dividend Paying Stocks and Treasury Bills.

While you are wondering why dividend-paying stocks should be considered the best place investments for short term when the cash payout is small, please note that you aren’t buying these stocks for dividend purpose but to take advantage of the institutional money that flows into stock with an attractive dividend yield, then sell before the closure date.

Typically, when a company beats its previous financial records and is expected to increase dividend payout in the current year, investors would naturally flock to the stock when it is time to pay a cash dividend to shareholders whose names are registered before the closure date. An influx like this leads to a higher share price as buyers bid on the stock ahead of the payment date.

What you should do at this point is to scout for stocks that pass my 6 checklists for picking great dividend stocks and accumulate certain units at a lower price, like 5-6 months before the closure date. For instance, most listed stocks in the Nigeria stock market release their end of the year results (December) around February and March. Dividend payment date (which will be announced) usually falls between May and June. Between January to April/May, there is what analysts call “First Half-year optimism rally” while July to November is tagged “Second Half Pessimism rally

According to a research published by the BusinessDay Newspaper on 19th, November 2018 titled: How Investors Missed Out on Decades of Easy Profit, it was revealed that, in the first half of the year since 2000, the stock market has delivered positive returns 16 out of 18 years while in the second half of the year, the market has rallied 9 times out of the 18 years (from 2000 to 2018). This means that if you were a probability driven technical investor, you will see easily that there is an 88% chance of an upside in the stock market in the first half of the year and a 50% chance of suffering a market loss in the market in the second half of the year.

If an investor invested only in the first half of the year between 2000 and 2018, he would have earned an average annual return on his portfolio of around 14.23% versus an average annual portfolio loss of around 0.58% if he only invested in the second half of the year. This performance only assumed that the investor holds in his portfolio all the companies in the stock market at a market weight, (or bought the NSE index fund).

For investors looking for short-term opportunities in the stock market, if you had invested N10,000,000 in the year 2000 in using the H1 optimistic rally strategy, you would have grown to N100,000,000 as at the end of H1 in 2018, providing you with almost 10x return. If you had done the same in an H2 only portfolio, you will be N9,590,000 as at now. (November 2018).

While some analysts have tried to give different reasons for this historical stock market rally, we believe that the market can’t come close to efficiency. For me personally, I found one particular reason for such rally which is a great opportunity for short-term players and that is dividend investing.  A lot of corporate actions are released to the investing public between February and May with the company’s shareholders’ closure date for dividend qualifications falling in the same period.

Besides, a larger number of stocks that offer attractive dividend above market average are found at this period and if you miss it, you might not find any again till the following year. So, it is natural for big funds from insurance companies, pension fund managers, asset and investment managers to chase these stocks at this period hence push the share price to the north, after the closure date, they liquidate their holding since they are already qualified for dividend payment.

This explains the usual rally you see every first half of the year. So, your entry as a short-term trader is to screen for stocks that offer attractive dividend yield above 8-10% using my 6 criteria, buy at a lower price around November and December and sell before the closure date (you will see notifications under corporate action). This strategy can net you a modest 15-30%.

Where will I invest for the remaining part of the year? you can explore the money market by investing in Treasury Bills or put your money in a safe fixed income mutual fund with positive historical track records.

While this short-term investment opportunity in Nigeria has been proven to generate impressive returns over an 18 year period, it is not devoid of risk, hence, due diligence is required when picking Nigeria stocks to buy.

If you follow my guide on how you should invest your money, this short-term opportunity is suitable for young and aggressive investors below 40 years and not for aged folks.

Which Low-Risk Mutual Funds Should You Invest In?

Best Mutual Funds in Nigeria – Top Performing Managers to Invest In Nigeria – Choose Equity-Based Fund, Money Market Funds or Fixed Income Funds for your Money in 2018, 2019, and 2020

I had earlier shared a guide on how a novice can start investing in the Nigeria stock market without getting involved in the day to day business and the best way to get started is via a regulated and registered mutual fund manager.

Mutual fund managers are considered professionals who understand and have been trained in stock market investing.

I also mentioned some of the mutual funds to consider based on their past performance in 2017.  Please note that these mutual funds are equity-based managers who invest in stocks and as such come with a higher risk of exposure to the stock market volatility. Just like we saw these funds deliver up to 52% in  2017 as investors drove the market to a peak level, the risk of sell-offs had also dragged their net asset value to the south.

The overall NSE index is down by 16% with all the 10 equity-based mutual funds following the same path.

According to Financial Vanguard, FBN Nigeria Smart Beta Equity Fund, managed by FBN Capital Asset Management, a subsidiary of First Bank of Nigeria, Stanbic IBTC Aggressive Fund (Sub-Fund), managed by Stanbic IBTC Asset Management and United Capital Equity Fund, managed by United Capital Asset Management, led the negative trend with a decline of 44.5 percent, 36.4 percent and 23.5 percent respectively in their NAV.

Axa Mansard Equity Fund, managed by Axa Mansard Investments placed fourth, dropping by 22 per cent, while Stanbic IBTC Nigeria Equity Fund, also managed by Stanbic IBTC Asset Management and ARM Aggressive Growth Fund managed by Asset & Resource Mgt Company followed with 15.4 per cent and 12.1 per cent decline respectively.

Others are Frontier Fund managed by SCM Capital, Legacy Equity Fund managed by First City Asset Management and Paramount Equity Fund, managed by Chapel Hill Denham Mgt, which slipped by 4.9 per cent, 3.7 per cent and 2.3 per cent respectively.

Considering the huge risk involved in investing in equity-based mutual funds, it makes more sense for long-term investors to buy into mutual funds that had recorded consistent return in the midst of market volatility on at least 5-year horizon.

Although past performance isn’t a guarantee for future performance but to a larger extent, it helps to screen for managers that had survived various economic cycles and are considered top professionals in the investment space.

These are mutual fund managers for those that aren’t comfortable with equity risk but still want a slow and steady return above benchmark.

Stanbic IBTC Absolute Fund

This is the most consistent of all the mutual fund managers mentioned here, The fund invests in fixed income securities like Treasury Bills, Bonds, Commercial Papers, etc with an objective of providing liquidity.

Stanbic IBTC Absolute Fund has made a loss in 1 month out of 69 months ranging from January 2013 to October 2018. The average return of this fund since 2013 is 78.12% and on a breakdown, the managers generated 10.01%, 12.61% in 2014, 13.19% in 2015, 11.59% in 2016 and 18.48% in 2017. So far in 2018, the fund has gathered a YTD return of 12.33%. This means that the fund has generated a total of 78.12% return since 2013.

FSDH Coral Income Fund

The fund invests a maximum of 30% of its investible fund in the equities market while the balance is exposed to fixed income market and money market instruments. The objective of FSDH Coral Income Fund is to provide long-term capital appreciations while maintaining low to medium volatility.

The fund has lost 11 times out of 118 months and had generated 102.41% on average.

Zenith Income Fund

As the name implies, this fund is owned by Zenith Bank and had been delivering positive return since 2012. Although, the percentage return has been a single digit, inventors, looking for a balanced fund, are still well-off investing in Zenith Income Fund. The fund invests in Treasury Bills, and Bonds.

The fund has only made loss 15 times out of 82 months period.

That is all for now! If you look closely at the type of assets these funds are most exposed to, you will notice that the money and fixed income market makes more sense to low risk long-term investors.

This is How You Should Invest Your Money

Best Investment Opportunities In Nigeria for Long and Short Term. High Yield Financial Investments With Monthly, Quarterly, & Annual Returns on Your Money 2018, 2019 – Forex, Dividend Stocks, Treasury Bills, FGN Bonds.

Selecting the right investment options for your idle cash isn’t an easy one; a lot of factors should be considered especially now that the investment world is full of uncertainties.

See – How to Invest in Nigerian Banks

In this investing guide, you will learn how to pick the best investment opportunities for the long or short-term horizon based on your preference and personal appetite for risk:

Key Investing Questions to Ask:

When looking for an investment opportunity, you need to ask yourself these questions:

  • Is this investible cash a percentage of my total cash balance or everything; “home and abroad”? Assuming you have N10 million in your life savings account and are looking for long or short term investment opportunities in Nigeria, the way you would invest N1 million, which is 10% of your N10 million cash balance, will definitely be different from your mindset if the whole N10 million is to be invested. A smart investor would rather take on lower risk opportunities on N10 million investment and higher risk on N1million.
    • So, when you are looking for a place to invest in, consider the percentage of what you are investing to your life savings; lower risk for 30 – 100% and higher risk on 20% or less.
  • How old am I? As dumb as this question sounds, it is also critical to determining where to invest your cash. You would be sharing a disastrous advice if you encourage a 60-year old man to go invest 70% of his life savings in the stock market. What happens when the market crashes? that is a short route to high blood pressure.
    • So, check your age range for better portfolio rebalancing; ages between 20 – 40 can invest actively in the stock market but as you grew older to 50, fixed income securities make more sense; what you need is an opportunity that generates monthly quarterly, semi-annual or annual cash flow return.
  • What level of risk am I willing to take? Every investment comes with a risk. The risk is the possibilities that your actual return may vary from the expected outcome; it could be higher or lower. In the investment world, lower risk opportunities tend to offer a lower return while high-risk opportunities usually offer an above-average return on your investment.

If you can provide honest answers to the following questions, you will find it easier to know which investment option is right for you.

Let me share some of the best investment opportunities in Nigeria based on the questions asked earlier:

  • For someone who is willing to invest 20% of his life savings, still below 40 years and wants to get ideas for short or long-term horizon, here are my tips:
    • For short term; buy growth stocks in a sound company, trade forex or commodities market, invest in growth mutual funds or start an online business.
    • For long-term:  buy dividend stocks, and, FGN bond and fixed income mutual funds.
  • For someone who is willing to invest his life savings and above 50 years:
    • For short term: buy Treasury bills, invest in 90-days fixed deposit, and invest in fixed income money market.
    • For long-term: buy FGN bond, invest in fixed income mutual funds, buy dividend stocks in a blue chip company and insurance annuities.

This is how you should consider and screen different options before deciding whether you want to go ahead.

As a beginner or a novice who doesn’t understand some of these investment ideas, let me share a brief information about them:

Dividend Stocks:

These are stocks that pay parts of our profit to shareholders; the cash payout is referred to as a dividend. Dividend stocks are great for investors looking for cash flow and as more buyers accumulate the shares of the company, prices tend to rise. Some of the best companies that pay dividends in the Nigeria stock market are Nestle, Unilever, Zenith Bank, GTBank, UBA, etc.

See – My Checklist for picking good dividend income stocks

Treasury Bills

Treasury Bill, also known as T-bills are short-term fixed income debt instruments issued by the CBN at a regular auction. T-Bills could be 30-days, 90-days, 180-days or 364-days with varying interest rates. The higher the maturity period, the higher your return.

When you buy T-Bills through your bank. depending on the type, an interest is paid upfront and credited to your account with the principal repaid on the expiration of the investment.

For instance, If you invest N1,000,000 in a 364-day T-Bills which, as of this writing, offers 14.95% interest, N850, 500 will be deducted from your initial investment leaving you with an upfront interest of N149,500. At the end of the 364 days period, your principal (N1,000,000) will be credited back into your account.

For lower T-Bills duration like 90-days, the calculation isn’t direct as you think; let us assume you opted for a 90-day T-Bills offer of 10.2%, your upfront interest isn’t N102,000 but N25,000.

Here is how to arrive at your interest payment: 90/360 (prorate the 90 days in a year ) x 0.102 (interest percentage) x N1,000,000 invested.

FGN Bond

Every year, the federal government (FGN) drafts its annual budget which contains a forecasted expenditure and expected revenue. As a way to generate more revenue for capital and recurrent expenditures, the FGN had always explored debt market if the cash flow from oil and taxes aren’t enough. One of the debt instrument issued by the government to raise more money for long-term capital projects is “Bond”.

A bond is a long-term debt instrument issued by the government to raise money for long-term projects; we have infrastructural bonds, SUKUK bond, green bonds, and savings bond. At the state level, some state governments issue state bond to finance state projects.

FGN bond pays interest semi-annually; every six months to bond holders directly to their account up till the maturity period after which the principal is paid back.

Mutual Funds

Mutual funds are a collective investment scheme that pools resources together for a common purpose. The funds could be invested in Treasury bills, bonds, the stock market or a mix of all these opportunities. Since they are managed by regulated professionals, it is considered safe for investors with little or no knowledge of the market.

In Nigeria, you can select:

  • Equity Funds, if you have a high appetite for risk.
  • Fixed Income Fund, for T-Bills, Bonds and Commercial Papers.
  • Balance Fund, a combination of equity and fixed income opportunities.

See – Top Low-Risk Mutual Funds to Invest In

Insurance Annuities

Under annuity plan, you would be expected chose a plan and pay a fixed calculated premium on a monthly quarterly or annual basis for a specified period of years after which, the insurance company will pay you for life. This option is considered safe for all investors as its help one plan for the future. Some insurance companies like AIICO, Mansard, NEM, Custodian offers annuity insurance products.

While these are the best investment opportunities in Nigeria for short or long-term horizon, you are free to share more profitable emerging business opportunities that are not yet tapped.

Top 7 Stocks That Could Offer Mouth Watering Returns in 2019

Best Stocks to Buy and Hold In Nigeria 2019 – Banking and Insurance Stock Recommendations In Nigeria – Best Performing Dividend IncomeStocks To Invest Your Money.

Nigeria still relies on oil as a key revenue driver but this year, the energy market has had an insignificant impact on the country’s stock market index, down year to date by 16%, despite the rising price of crude oil in the international market, now above $60 per barrel.

As we wrap up 2018 and prepare for the new year, I would like to discuss the economic indicators, and market risks that will influence equity market investment decisions and key sectors to focus on.

See – ” Sure Growth Stocks, That Started Well in 2019, You Should Buy Now

Where Are We Economically – Risk Perspective?

Nigeria relies on imported products for its daily personal and business needs as such exchange rate stability is very important to the sustainability of the economy.

This is the sole reason…

The CBN has shown its resolve to keep the Naira from weakening against the dollar at all cost, even if it’s going to starve the private sector of credit and burn through the country’s external reserve as a record price.

(Source: BusinessDay)

Foreign capital exit to high-yielding assets in the developed countries., at the same time, is expected to intensify on the back of a rising yield on US Treasuries as the Fed plans more rate hike in 2019 and growing political uncertainties which will impact the risk premium on Naira-denominated assets and put pressure on the exchange rate.

The Naira has already weakened from N360, the rate it exchanges to a US dollar at the beginning of the year, to N363.32 at the I & E windows. This, coupled with massive equity sell-offs in the local bourse, is a clear indication that foreign investors are already exiting the economy for greener pastures.

Here is a big opportunity for smart investors:

Since the CBN has vowed to protect the weakening Naira, it surely would have to find a way to reduce Naira sales at the I & E window by enticing these foreign investors with higher rates on fixed income securities like Treasury Bills and Bonds.

Using the recently concluded Auction on Wednesday, 31/10/2018, where Treasury Bills worth N145 billion were issued the stop rate on 91-day T-bills trended upwards to 10.975% compared to the stop rates at the previous auction, 10.96%, it is also visible that the apex bank has started its drive to make Naira asset attractive.

The rate of 182 days and 364 day T-bills rose to 13.49% and 14.4% respectively from 12.69% and 13.45%. I expect this to continue in the coming auctions.

With average bond yields at around 14%, the rise in T-bill yields is gradually taking us back the era of “FREE MONEY IN THE MONEY MARKET“, last seen in 2017 when the yield on short-term securities rose to 17% record level, above long-term rates. This will no doubt mount pressure on the government as debt servicing cost may rise to 69% by the end of the year.

When yields on T-bill starts rising and becomes attractive, funds that would have been channelled to private sector lending would be diverted to these safer government securities.

If CBN T-bills slow-down hurts bank’s profitability in the first and second half of 2018 financial year, it makes sense to say that the rising yield on T-bills issued will also drive the financial sector’s profitability in which the bank, insurance, and other asset managers are part of.

Offering a higher yield on short-term securities may not be the only resolves of the apex bank, it is also “upping” dollar interventions to save the Naira from devaluation but the former seems to be more effective but expensive.

Going Forward – Key Sectors to Watch in 2019

Banks

Bank lending, as shared on how bank wants to make more money, is already dipping on the account of weak economic activity and political uncertainties with big banks cutting their loan book while increasing their investment securities. In 2019, we expect banks to park more of deposit generated in T-bills.

  • My top 3 banks to watch are Zenith, UBA and GTB; they all offer attractive dividend yield and may appreciate in price.

Based on my 6 checklists for picking dividend income stocks, UBA and Zenith are my preferred dividend stocks.

Insurance

Insurance companies are also expected to invest more of the net premium income generated from policyholders on these fixed-income assets. I would advise you key into profitable insurance stocks with above average return on equity and a combined ratio of less than 100%.

  • My top insurance stock picks are Custodian Investment plc (dividend and share price appreciation) and NEM (share price).

Asset Managers

Investment firms that provide investment banking, asset management, securities and insurance services to corporations, governments, high net worth, institutional and retail clients are also not left out of the interest income from rising yield on T-bills in 2019.

  • My top picks for dividend income and share price appreciation are UBA Capital and Africa Prudential

While these best stocks to buy and hold in Nigeria 2019 have had their past profitability driven by rising yield on T-bills, it doesn’t in any way imply a BUY or SELL recommendation nor negate other listed equities, you are advised to do your homework.

One of my results – I shared an analysis of Cement Company of Northern Nigeria ( CCNN ) in February and why you should buy the stock. The price has increased from N16 to hit N31, 90%+, now at N22.

Why I Sold Some of My Nigerian Stocks and Bought More American Stocks

Trade American Stocks Online – Learn How I Buy & Sell Foreign Stocks With an International US Stock Brokers for Non-US Residents or Foreign Investors

Trading the stock market has always been my favourite way to make and multiply money easily and during my trading journey, I have come to understand that the stock market isn’t partial; it rewards those who, through diligence and well-planned strategy, understand the perfect time to open positions and exit their trade but burns gamblers seeking a quick return.

I had a discussion with one of my blog visitors on the way forward after he read my guide on the 3 low risk fixed deposit options that will likely outperform stocks in the next 6 months. His portfolio is down by close to 20%, no thanks to Dangote Cement stock and Zenith Bank, these are stocks he anticipated would deliver impressive results this year but aren’t so.

As of this writing, all eyes are currently on Ekiti State governorship election, a lot of local and foreign investors are following the recent happenings to understand and gauge the effect of the upcoming election in 2019. For me, I am cutting down my exposure to the Nigerian stock market, the possible risk of further fall is very imminent. Let’s analyse the chart using some of my favourite indicators, this will help us understand what the next 6 months would be:

Trade American Stocks Online

Using price action analysis on a weekly chart, the NSE all-share index broke the 50-day moving average which also doubled as a key support  and an old resistance level, the index pulled back for 2 weeks and kissed it goodbye: we have seen how the market had performed in the last 30 days with YTD performance now at -4.9%. This is a perfect reflection of the bearish sentiments which, fundamentally, isn’t unconnected to the factors earlier shared on this blog

Why are we bothered about the general market and not individual stocks, after all, there are some stocks with YTD return above 50%, you may ask? My dear, the truth is no matter how strong the fundamentals of a stock is, a larger percentage of share price move is still not disconnected to the investor’s sentiment on the economy. Take a look at Zenith bank, UBA stocks, despite their strong earnings and balance sheet size, they have barely delivered up to 10% return this year, why? the growth of bank stocks is tied to yield on fixed income securities as loan portfolio expansion is expected to be minimal.

I can go on to explain and give reasons I am not bullish on the NSE all-share index, at most 6 months from now but why did I opt for US stocks? To answer this question, I would like to share the chart of Dow 30, an index that tracks the performance of the top 30 most capitalised stocks in the US stock market.

While the NSE all share is set for another weekly fall, the Dow 30 index has just bounced from a key support level to the upside and as the 20-day sits above 50-day and 200-day moving averages, we can confidently say that the index is clearly bullish for stocks. As a smart stock market trader, I would rather be active in a market that is bullish, then allow my portfolio to lose value in a bearish market.

Another reason I would hold more US stocks to our local bourse is “availability of technical tools and data“, the US stock market is very open to international traders; you can access real-time market data on several financial platforms like Google Finance, Bloomberg, and MarketWatch from your personal PC while data on the Nigeria stock market trading is delayed, you can’t access the NSE trading terminal unless you are a premium subscriber or a registered stockbroker.

Lastly, the US stock market provides a larger pool of stocks to pick from. You have access to over 5,000 stocks, ETFs, mutual funds to invest in but I am only trading these selected stocks which are: Groupon, Apple, Cisco, Google, Amazon, Intel, Facebook, Microsoft, Tesla, Netflix, AT & T, Berkshire Hathaway, Bank of America, Boeing, Caterpillar, Chevron, Citigroup, Coca-Cola, Walt Disney, Exxon Mobil, General Electric, General Motors, Goldman Sach Group, Johnson & Johnson, JP Morgan Chase, McDonald, Pfizer, Procter & Gamble, Twitter, Alibaba, Visa, MasterCard, and SnapChat. These are the few stocks available on my broker’s platform for now but I still find these companies liquid, attractive and highly capitalized for new traders.

You don’t have to buy all the companies in the US stock market before you make money, just focus on few stocks with potential, master a trading strategy and trade your plan consistently, that is what successful stock market traders do, they trade like a sniper.

That’s all you should know about my decision to be more active in the US stocks.

Since I shared this content, I have received a lot of response from my blog subscribers on how they can get started trading US stocks and strategies to profit from short-term price moves in stocks like Facebook, Apple, Visa, MasterCard, Amazon, Groupon, Microsoft, etc. 

You can follow my latest weekly analysis of US stocks and see some of my trade setups here.

This group is strictly for traders who wish to trade local and US stocks. Click here to join the group now 

Warning: We will ban you from the group if you post an update that is not connected to the group.

3 Low Risk Fixed Deposit Opportunities that Beats NSE Market

Where to Invest Money in Nigeria – Top Online Savings and Investment Opportunities With Highest Interest Rates on Fixed Deposits Account than Stock Market.

It’s Sunday afternoon and I decided to check the average return on Nigeria stock market in the last 6 months so I could focus and buy more shares in companies that delivered more than 50% this year. In my portfolio, I had few stocks on the green territory and a larger number of equities traded on the negative territory because of the overall market sentiments. The NSE index is down, back to the red region, no thanks to the anticipated US rate hike that led to sell-offs in emerging market currencies and equities. This coupled with rising tension and political risk had adversely affected foreign portfolio inflows to the equities market.

What is going to happen in the next half of the year (2018), you may ask? I must be candid, the next 6 months isn’t going to be smooth for stocks.  The upcoming election is one factor you can’t ignore right now, the heat is becoming hotter and investors, from past experiences, tends to sell their equities ahead of general election, so expect NSE index to be broadly affected by this sentiments.

Another factor is the second anticipated US fed rate hike, carry trade traders tend to favour currencies with a rising interest rate to a stable currency which is the reason emerging market currencies are at risk of sell-offs. The US bond yield is at an all-time high right now and such return is no doubt “a sugar on fixed income investors’ tongue“. The NSE index might also be impacted as a major percentage of capital flows to the NSE comes from foreign portfolio holders.

Another key factor is a general sentiment, we think investors aren’t seeing any positive market or fundamental news that will drive the market again, Oil price which is suppose to be a key driver is up in the last 6 months but have had little or no impact on the NSE market. The correlation, this year, is now negative; as Oil prices reach a new high, investors aren’t factoring such positive indicator into the NSE all share market as witnessed in 2017. I feel such news has already been priced in.

What happens to my portfolio? Well, that depends on the sector you had invested in. While the next 6 months might not be as smooth as you would expect, there are still stocks to buy and enjoy average return above the NSE index.

I have already shared a detailed guide on how to pick stocks in a bearish market, a simple strategy that uncovered my best performers right now. Click here to learn more, maybe it will help you reshuffle your portfolio to select stocks that would do well this year.

For some of us who are still protective in this volatile market and wouldn’t want the bearish trend to wipe out a significant portion of our investment portfolio, I will be sharing the 3 alternative low-risk fixed deposit options that had outperformed the Nigerian stock market index so far. These investment options do not necessarily demand a special skill, financial prowess or consultation with a stockbroker, we are currently exploring them to, not only protect our investment but at least hedge against equity market fall.

As a smart investor, the stock market shouldn’t be the only place to make money, fixed deposit and insurance options are where to invest money in Nigeria

PiggyBank SafeLock

PiggyBank is an automated savings app that lets you save a specified amount (with a “Quick Save” feature for saving at your pace), for a stated number of days after which the fund will be available for withdrawal and if you opt to cash out before expiration, a 5% charge will be deducted from the amount saved.

But here is the catch about PiggyBank that made me recommend the app as one of the best places to save and earn higher interest above the Nigerian stock market; PiggyBank offers a SafeLock feature, an innovative disciplined fixed deposit opportunity that lets you lock away cash for a specified period while your interest is paid upfront.

For instance, if you wish to fix N1,000,000 for a year, you will earn 12.4% upfront, which is N124,000 payable into your PiggyFlex account. PiggyFlex account holds all the interest earned on your fixed deposit, and it’s available for withdrawal.

You can give PiggyBank a try as the six (6) months interest rate estimated at 6% far exceeds the NSE index performance in the same period. In the midst of stock market volatility, you can explore this guaranteed interest income opportunity ahead of the general election fever.

Like I always say, I don’t practise what I don’t preach, Click here to read my success story on PiggyBank Website.

I have already reviewed the other two savings plan you can explore if the stock market seems risky to you.

To learn more about the other two fixed deposit investment plan, click here.

Please note that the NSE market return we benchmarked these fixed income opportunities on, is the first half of 2018.

How I Trade Bitcoin for Serious Profit

How I Trade Bitcoin for Serious Profit With Strategies – Learn my Powerful Cryptocurrency Trading Strategies that Makes Money every time I Buy & Sell

I am an active trader who focuses on local stocks, international stocks and cryptocurrencies: Bitcoin, Bitcoin Cash, Etherum and Litecoin. These are my biggest profit makers as far as investing is concerned, at least the diversifications offered by these asset classes makes me find several opportunities to trade while hedging against the bearish trend in one market.

Today, I will be sharing my strategies and how I have been trading the bitcoin since 2017 using the same tactics I shared in my video course.

Someone sent a mail to me and asked “Oge, beyond stock, where else can I apply the strategy you shared in your video? it’s quite interesting, practical and usable”. When I read his mail, I was quite shocked, why, you may ask? because as of the time I opened the mail, I was already concluding an alternative investment option you can also explore the stock trading strategy I shared in that video on.

For subscribers that bought and had already watched the video, it might interest you to know that the step by step blueprint works perfectly well on Cryptocurrencies too, Bitcoin, Bitcoin Cash and Etherum.

How I Trade Bitcoin for Serious Profit With The Technical Strategy

Lets’ start with the Bitcoin price on a longterm chart:

How I Trade Bitcoin for Serious Profit

From the chart above, you see how the 3 indicators were so perfect in predicting the bullish strength that drove bitcoin from less $1000 to $20,000 before the historic crash that started in February 2018. Did you know that before bitcoin price nose-dived, the indicators had already pointed that price was already overbought?

Bitcoin on a long-term is a no-go area for me; if you are asking for a trade advice or whether to buy and hold for next 3 – 6 months, I would recommend that you send a “SELL MANDATE” to your broker or bitcoin agent. The emerging bearish crossover isn’t what you would bear when price crashes further from the current level of $7,600 to $3500, an estimated 50% possible loss if it eventually occurs.

But if you are looking to play in the Bitcoin space in a matter of days, weeks or maximum, a month, then you can read on to see an opportunity that had just opened an alternative profit potential in the financial market.

Let’s drill down further to the weekly chart:

How I Trade Bitcoin for Serious Profit

Using the strategy I shared in my video, you will also discover that the same bitcoin that is a no-go area for short-medium term trader, is actually oversold on a weekly chart; the price fell sharply last month (May 2018) to a key support level ($7,300-$7500), this is the third time price will test that level before retracement. As of this update, bitcoin is up by 0.28% to $7,686.5.

Since I am only looking for a bullish opportunity to cash in on as a swing trader, let’s drill down again to see what is happening on the daily chart for a better entry.

How I Trade Bitcoin for Serious Profit

Wao! Can you see what I just saw now? There is a bullish sign on the daily chart, two indicators are already pointing to a possible increase in the coming days while the third is catching up. In my video, I showed which of the indicators is a leading indicator to pay more attention to.

Let’s also look the bitcoin cash price:

How I Trade Bitcoin for Serious Profit

All indicators are also pointing to an upward trend in the bitcoin cash market.

My trade decision right now is to wait for a perfect signal like I shared on how to trade like a sniper and buy more bitcoin and bitcoin cash from Nairaex and load into Bitcoin Wallet, at least while I wait for the overall stock market index to reverse its strong bearish trend, bitcoin may be my next perfect alternative trading options. The trading risk at this time is still high because the third (3) indicator is yet to fully confirm but the reversal on the weekly is what I am “banking on” to execute my order.

So, I would advise you to wait until DMI shows a bullish cross on bitcoin chart and allocate a maximum of 20% of your cash into the cryptocurrency market if want to be aggressive, for risk-averse, go for 10% but like I said,  sell off in days, or weeks.

I hope you found this guide on how I trade bitcoin for serious profit useful and if you thinking of upgrading your skill on how to trade stocks and bitcoin for profit, click here to get my video course.

Which Bank Offers the Best Domiciliary Account Services?

Best Bank for a Domiciliary Account in Nigeria – Compare Account Opening Requirements, Fees & Charges, Interest, Exchange Rate and Security for FCMB, First Bank, GTBank, Access, Zenith, Ecobank, UBA, Wema, Sterling, Diamond, Stanbic IBTC, Fidelity

This article will help you spot the best bank for a domiciliary account in Nigeria with 6 useful guides to compare the banks you want to open an account with.

Owning a domiciliary account with a Nigerian bank is not an option again, it’s a necessity for someone that wants to manage and protect his wealth by diversifying into foreign currency portfolio. A lot of Nigerians still don’t know that a domiciliary account is an alternative investment option to consider, now that the USD exchange rate is on a bullish side.

You will find tips on how to open an account with all the Nigerian banks alongside basic requirements you need to have before your account officer can proceed with the domiciliary account opening procedures. I also went ahead to give reasons you should own a domiciliary account; cost savings when paying online, exchange rate gain and access to offshore investment opportunities.

See – How to trade open a US Stock trading account using your Domiciliary account.

Best Bank for a Domiciliary Account in Nigeria – 6 Key Tips

For a new starter looking for the best bank for a domiciliary account in Nigeria, here are basic tips on how to compare FCMB, First Bank, GTBank, Access, Ecobank, Unity, UBA, Wema, Sterling, Diamond, Stanbic IBTC, Fidelity, Zenith Bank, Union and Heritage Bank.

1. Check Monthly Fees

When you go to the bank to withdraw from your domiciliary account at the counter, you will be charged for withdrawer (depending on the amount and whether you used a counter cheque or your own chequebook). Ask your account officer the bank charges on withdrawing, ATM maintenance fees, cheque slip charges and other sub-charges in order not be taken unawares. Two days before I wrote this article, my bank deducted $10 from my account as an annual account maintenance fee and I was wondering how they are maintaining account until I approached my account officer.

2. Minimum Requirements

Before opening a domiciliary account with a bank, compare what the requirements are across selected banks, while some will ask you to deposit a minimum of $100, utility bills, passports, two referees with current accounts, others may be higher.

3. Transaction Limits

Inasmuch as a domiciliary account allows you to make purchases and pay a merchant directly, CBN is still beaming its searchlight on foreign currency transactions, money laundry and so on, and as such, there could be some restrictions on your domiciliary account transactions. A few years ago, CBN mandated all domiciliary account withdrawal to be paid in Naira using official exchange rate and other time, they restricted foreign account transfers to $10,000. These are some of the ways your use of dom account could be limited but you still need to compare how individual banks transactions limit are so you can settle for the institution with flexible policy.

4. ATM Charges

Have you used the debit or credit card on your domiciliary account to withdraw from an ATM machine? I tried it during an emergency and was amazed at the exchange rate my bank applied, it was over N100 lower than what I would have sold the currency per dollar at the black market. You need to compare inter-bank exchange rate on AbokiFX and what your bank currently offers.

5. Mobile and Internet Banking;

You may not be free to walk into a bank to carry out transactions on your domiciliary account every time but with mobile banking app on your smartphone, you can easily check balance, transfer fund, view on incoming flows real time and monitor your account history. Compare features available and how fast mobile applications for your banking services will be across some selected banks so you don’t experience network issues; though, it could occur but shouldn’t be frequently as this could be frustrating.

6. Security

This is the most crucial of all these tips mentioned here. Find a bank that sends security alert and tips to its customers on a weekly or monthly basis, this will help you know the method scammers are using to access users account online. That doesn’t mean you should relent and leave the security of your account to your bank, update yourself and subscribe to some internet banking security blog for useful guides.

Scammers are constantly adopting new strategies, most of which are mobile related, to steal sensitive information like credit cards, from forex account owners and you can’t afford to be relaxed, take actions, buy genuine anti-virus like Kaspersky internet protections.

While these are my 6 basic tips to find the best bank for a domiciliary account in Nigeria, feel free to share comments and suggestions.

How I Trade US Stocks Online

How To Trade US Stocks From Nigeria & Overseas – Learn How to Open a US Stockbrokerage Account, Pick Profitable Stocks As Non-Resident Citizen Living Abroad.

As a Nigerian who is looking for overseas investment opportunities in a market like the US, it is quite difficult to find an online broker that offers unrestricted access to the financial market. If you doubt, then you can spend some time to research all the regulated stockbrokers in the US, you will notice that one of the countries that are hardly accepted in their client record is Nigeria.  While I understand the regulatory reasons for such decline, and the need to ensure sanity in their global financial market, I still feel there are sincere local traders and investors to consider.

See – The Best Low-Cost Online Platforms for Trading US Stocks Via CFDs

Why are foreigners/non-US resident showing increasing interest in US stocks despite the presence of the local stock exchange [platforms in their respective countries? The US stock market remains the world’s largest and most liquid stock exchange in the world. Not only does it give you opportunities to trade top global brands, but also lets you diversify your portfolio into foreign-currency-denominated assets.  Besides, the number of publicly listed US stocks representing major sectors is more than 7000, and that of foreign listed stocks in the market keeps increasing as they seek access foreign currency capital for expansion.

For us here in Nigeria, the market is a perfect alternative to trade stocks and diversify equity portfolio away from the Naira, especially now that the NSE index performance has shrunk from a peak of 45,000 points in February 2018 to 38,000. As of this writing, the NSE index has just returned to a negative path, posting -15% YTD on the back of higher than expected selling pressure.

This bearish trend as pointed out in my post on how to pick stocks in a bearish market is very strong, the dollar against emerging market currencies is gaining momentum as the FED reserve increased US rate from 1.5% to 1.75%. Normal, foreign portfolio investors, who are looking for “carry trade opportunities”; buy currencies with increasing yield and sell currencies with falling yield.

Also, the political landscape, as the country’s general election approaches, isn’t clear, so fund managers are re-adjusting their portfolio to cushion the effect of possible risk.

If you look at the NSE market outlook in near-term, it makes more sense to cut equity exposure as a short-term trader until the market regains its strength (Watch my videos on how to analyse general market sentiment) and diversify into the foreign stock market.

Diversifying into the US stock market offers a perfect hedge against exchange rate risk arising the US dollar strength against the Naira and lets you trade various asset classes beyond equities; metals, energy, and indices. Each of these asset classes tracks the performance of virtually all the segments of the US and world economy, for instance as the US dollar index continues to strengthen against emerging market currencies, there is a tradable ETF that tracks that movement, and as the Oil price increases on rising tension in the middle east, there is also an Oil ETF shares to trade, even the overall market indices, S & P, Dow 30 and Nasdaq have their ETFs too.

Another catch I love so much about US stocks is that there is no limit to their daily price movement, a stock can rise and fall by more than 100% depending on investors’ sentiment. Take a look at the snapshot of two stocks that gained 143.12% and 105.23% on a single day:

You won’t find such an opportunity in our local bourse as regulatory and allowable changes are capped at +/- 10% daily.

The summary of these is that you need to look beyond the local stock market by giving foreign stock trading a try, but not without having a proper understanding of strategies for picking stocks that will rise.

How I Trade US Stocks Online from my Laptop PC

I trade US stock via a CFD broker. Some of the top companies available on the platform I trade on are Amazon, Google, Facebook, Microsoft, Apple, Visa, MasterCard, Netflix, Tesla, Alibaba, Twitter, GE, McDonald, etc

To get started on US stock trading via CFD,  follow these steps:

  • Click here to see my preferred online stock trading platform.
  • Click on “Register” and fill the form with your “First Name”, “Last Name”, “Email”, and “Phone Number”.
  • Click on “Create Account”.
  • A mail will be sent to your registered email. Follow the guide to complete your registration.

That’s all.

For mentorship and actional trading ideas that will earn your money, I have compiled practical 8 session video course that will guide and teach how to pick US stocks.

Click here for more info

I have also added US Equities Market to this blog so you can follow my weekly US stock analysis and trade setups.

This Untapped High Yield Savings Plan Is Better Than Treasury Bill, Bond & Fixed Deposit

Best High Yield Investment Opportunities In Nigeria Only a Few Knows – Learn How To Find Most Profitable Untapped Long-Term Investment Ideas

When people talk about saving money for future projects or as a way to be liquid and not run out of cash in the next 5-50 years, the next place you see them go to is the bank. Why?  because they don’t know any better alternative savings opportunity that could practically earn more interest and provide streams on cash flow for long-term projects.

See – How to Create Multiple Streams of Passive Income for Yourself

See – The Perfect Guide to Know Where to Invest Your Money

Today, I decided to research better savings options one could explore as an alternative to banking products with attractive yearly interest return (after adjusting for inflation) higher than fixed income securities, then I remembered a friend who proposed an insurance savings plan that offers up to 43.3% return annually.

This sounds interesting! “I don’t believe this, you may exclaim” but it’s real. Such a return isn’t easy to come by, especially in a very high-risk environment like ours. Even when you adjust for the last reported inflation of 12%, you still have 22% positive interest to enjoy.

Where else can you find a risk-free opportunity like this? Treasury bills, bonds yield, even though they are risk-free too, are subject to economic risk. The yield on 1-year TB has fallen sharply, from a high of 22% in 2017, to a recent low of 12%. The downward trend is a result of FGN decision to lower exposure to the domestic debt since its more expensive to finance compared to foreign denominated debt.

I really don’t know whether to call this plan a savings or investments, but since you would be required to make a quarterly, semi-annual or annual contribution, let’s call it a savings plan. From the return above, it is clear that this insurance product earns more than any long-term fixed income security (including bond) you could ever think of right now, YES! it beats treasury certificates, bonds and fixed deposits.  Besides, long-term investors looking for a reliable low risk, stable and high return investment option devoid of risk should take this plan seriously.

See – Best Low-Risk and Steady Return Mutual Funds to Invest in Nigeria

But, the problem now is that when you preach insurance to people, they feel you are reminding them of “death, accidents or unexpected events”. No, this isn’t one of them, this insurance policy known as a Flexible Endowment Plan is one of my best long-term savings portfolios right now.

Best High Yield Investment Opportunities In Nigeria Only a Few Knows

It is a low-risk high yield plan that combines protection and investment with the following benefits.

  • It provides for guaranteed payouts at regular intervals in three instalments.
    • 1st Payment of 25% of face amount at ¹⁄3 of the policy term (5th year)
    • 2nd Payment of 25% of face amount at ²⁄3 of the policy term (10th year)
    • 3rd Payment of 100% of face amount including the accrued reversionary bonus at full maturity (15th year)
  • Provides for full payment of the face amount in the event of the death of the policyholder during the period of insurance.
  • Provides for full tax rebate annually.
  • Provides for an annual reversionary bonus (interest) payable in addition to the face amount or earlier death at the rate of 4% or N40.00 per thousand.
  • Provides for cash values on the basic policy and the declared reversionary bonus.
  • Provides for a loan of up to 70% of cash value after three years of running the policy.
  • Provides for policy surrender after two years of payment and maintenance of policy.

Additional Riders

  • Waiver Of Premium –This benefit comes into force at a time when a policyholder is unable to perform his normal duties as a result of either accident or critical illness for a minimum duration of six months. Premiums that fall due within such period are waived and the policyholder will not be charged for it.
  • Permanent Total Disability–This covers the loss of body parts that make it impossible for the customer to continue to work as he used to. At this point, the policy is treated as being matured and full benefits are paid. Examples of such disability are the loss of both eyes, both hands and both legs (if a footballer).
  • Accidental Death, Dismemberment and Weekly Indemnity Rider –This covers loss of parts of the body following an accident as stated in the schedule of Indemnity attached to the policy document. The principal sum under this benefit rider is N2,000,000.00.

Why is this low-risk, high return investment a preferred option for smart wealth protection strategy? It offers an attractive annual return estimate of 43.3%  on your investment without exposing you to economic, political or market risk.

Investment table:

The table below shows different insurance cover you can subscribe to, and their respective premium and payouts on maturity.

Investment Volume
Annual interest
Annual premium
Semi-annual
1st partial maturity
2nd partial maturity
Full maturity @ 15thyr
Accrued interest/ bonus
#5,000,000
200,000
461,350
239,940
1,250,000
1,250,000
5,000,000
3,000,000
#10,000,000
400,000
922,100
479,530
2,500,000
2,500,000
10,000,000
6,000,000
#15,000,000
600,000
1,382,850
719,120
3,750,000
3,750,000
15,000,000
9,000,000
#20,000,000
800,000
1,843,600
958,710
5,000,000
5,000,000
20,000,000
12,000,000

How did I arrive at this double-digit growth interest return? Let’s say you subscribe to an annual investment cover of N5,000,000 (refer to the table above), you will be required to pay a premium of N461,350 annually or N39,000 monthly. On your annual N461,350, you will earn an annual bonus of N200,000 which should increase your portfolio value to N661,350 in Year 1, that’s like 43.3% interest return on a yearly basis.  At the end of 5 years, you would have access to 25% of the insurance cover of N5,000,000 which N1,250,000 credited to your bank account. This is like 54% of your cash savings of N2, 306,750 while the N200,000 bonus is already grown to N1,000,000 (in 5 years).

The N1, 250,000 payout is enough to finance a project or start another business that will generate another stream of income to your account. You can even plough back your cash payout into the insurance plan.

Your second partial payment of N1,250,000 comes in subsequent 5 years, that’s like N27% of N3, 363,500 cash savings net of initial payout in the first 5 years. Your annual bonus of N200,000 would have grown significantly to N2,000,000.

At the end of the 15 years investment period, you would receive N8,000,000 (N5,000,000 insurance cover at maturity plus N3,000,000 accrued bonus for 15years (N200,000 x 15). This means you would have received a total of N10,500,000 (N2,500,000 for the first 2 payouts and N8,000,000 cash payout on maturity).

When you compare what you had saved, N416,350 x 15 years, N6,920, 250 to the payout of N10, 500,000, you would have enjoyed an additional interest of N3, 579, 750, which is 51.7% return on your long-term savings.

If you also looking for more of the best high yield investment opportunities in Nigeria that beat treasury bills bond and fixed depositsee my dividend income stock analysis.

4 Investment Opportunities in the Banking Sector You Can Explore

How To Invest In Nigerian Banks – Learn The 4 Best Investment Opportunities In Banking Sector -Fixed Deposits, Commercial Papers, Mutual Funds and Stock Trading 

A lot of people thought that banks are financial institutions designed to only accept a deposit/mobilise funds for savings purpose and make it available to their customers upon request, they don’t that know beyond the normal savings and withdrawal services, there are investment opportunities offering better return compared to the paltry 2-3% interest income.

See – 4 Top Investment Apps You Should Download for Higher Returns Than your Bank

In this dynamic environment, where the price of essential amenities is constantly surging higher every day, you can’t afford to be mediocre or allow the value of your savings gets wiped out by inflation which, as of this writing, sits at 13-14%. Rather than allow your bank take your money, pay your 2-3% interest and advance your cash to corporate customers at a higher interest of up to 22%, there are alternative investment options you can try now.

This article explores practical ways you can invest in Nigerian banks at moderate risk and earn returns on your investment.

See – How to create multiple streams of passive income for yourself even if your salary isn’t enough.

How to invest in Nigerian banks – 4 Opportunities to Explore:

  • Fixed deposits 
  • Commercial papers
  • Mutual Funds
  • Stocks

Investment in Fixed Deposit

If you are a customer who operates a savings or current account with a bank, you can take advantage of the returns on fixed deposit by transferring your idle cash balances; funds you may not need in 3-6 months. All you need to do, send a letter to your bank requesting for a certain sum of money to be transferred to a fixed deposit, duration and effective date. The minimum tenor of fixed deposit investment is usually 30 days but the maximum depends on the bank. Interest on your principal is calculated on a simple interest basis. Also, the total interest-earning accumulated over the investment period is subject to a withholding tax of 10%.

Commercial Paper

 Commercial papers are unsecured promissory note issued by a company to holders – such short-term debts are used to finance other short-term liabilities. You need to approach your bank to inquire about this investment and the terms of the arrangement. Usually, commercial paper is issued by banks with stable earnings or companies that have a good credit history.

Mutual Funds

This is one of the best short-term investment available to bank customers in Nigeria. Most banks operate a mutual fund, a financial window that mobilises funds from interested investors and pays a guaranteed interest on a monthly, quarterly or annual banks. The interest payable to account holders are determined by NIBOR, Nigerian Inter-Bank Offer Rate – the rate bank lends to one another.
 

Stock

If you are looking for a higher return opportunity compared to other windows mentioned above, the stock exchange market is the floor to play in. While investing in banking stocks comes with its own risk, the reward can be huge when you do a thorough analysis your bank’s future potential compared to its present stock price.

Aside from price appreciation, you can also earn a dividend on your equity shares.

See my detailed guide on how to analyse and pick banking stocks.

Final note

Before you invest your fund in Nigerian banks, please consult your financial adviser for more details.

This Mutual Fund Makes More Money When Naira Loses Value

Where to Invest Money In Nigeria During Economic Collapse – Learn The Best Mutual Funds Investment Opportunities During Economic Recessions.

So far, the Dollar to Naira exchange rate has been stable for more than 10 months now, a positive trend that is directly tied to the bullish oil market, increasing foreign reserve and the introduction of an alternative and highly liquid FX market; investors and exporters window where the exchange rate is market driven.

Foreign investors confidence in the economy is also at an all-time high, at least you can see from the data presented on my post on how to make money from the stock market even when you can’t trade yourself.

Nigerian is no doubt an oil-driven economy, the short-medium term bullish oil price is the major factor driving the overall economic growth; thanks to the OPEC decision to cut production quota in 2016.

The US proposal to withdraw from the IRAN nuclear deal is another supporting factor that is believed to have driven the commodity market to newer higher (above $75), the market has already priced the possible US pull out knowing that Donald Trump had continuously criticised his predecessor on IRAN Nuclear Deal.

All these are big reasons, analyst are bullish on the crude oil in the short-medium term.

As of this writing, CBN foreign reserve is at $47b mark, a result of greenback supply from crude sales, foreign direct investment (FDI) (into the financial market) and sales of EURO bond, the federal government alternative source of funding infrastructural development at a lower interest rate.

While this news is attracting hot money into the economy and positive for NSE investors, it is no doubt exposing the economy to a greater risk that could outweigh the benefits if diversifications are on FG priority list. A larger percentage of the FDIs aren’t invested into long-term or developmental projects, but are channelled towards the financial market; these foreign portfolio managers are looking for short-medium returns from the equities and bond market.

The big risk here is that these foreign funds can easily be withdrawn from the financial market if an unfavourable news ( like Oil market fall, possible resumption of attacks on oil facilities in Niger Delta or political instability) breaks out.

Looking at historical trends when the CBN reserve growth was stalled and FDI suffered setbacks on oil production coupled with the fall in Oil price to an all-time low, we saw how the greenback (dollars) exchange rate to the Naira increased significantly to N500, a level that made importation difficult.

The stock market at that point fell as investors pulled out fund to a safer haven, capital flight was an everyday activity as foreign companies repatriate capital (in USD) back their home country while manufacturers restored to local farmers to sustain their business. The period was indeed a tough one.

However, even in tough and rough financial markets, you might ask, can one still find alternative profitable investment opportunities in Nigeria? My answer is “YES”

For those looking for opportunities in tough times, here is a look at the best-performing mutual funds to channel your funds to when the Dollars to Naira exchange shows another sign of increase:

FBN Nigeria Eurobond USD Fund

Although, it is usual that during an uncertain difficult period in Nigeria where USD/NGN exchange rate is rising faster, investors tend to buy into fixed income investment opportunities like the bond, and treasury bills. But, smarter investors like us invested in FBN Nigerian Eurobond, a USD denominated fund, a better place to invest to explore double return. The reason isn’t unconnected to the fact that the fund is fully invested in USD denominated debt instrument which doesn’t only offer a fixed interest income but enjoys a higher income from translation gain.

Translation gain is the gain that results when amounts stated in one currency are translated into another currency. Assuming you invested $1000 ($ = N305) into FBN Eurobond in 2014 with an annual interest rate of 7.5%, that’s like $75 receivable on your investment.  As of this writing (2018), a USD = N360, that’s like an additional N55,000 added to your portfolio (N360,000 – NN305,000) and  N108,000 ($75 x 4 x N360) interest income.  You will notice that a major percentage of your portfolio gain will come from the forex conversion.

The profitability of this investment idea depends on the USD/NGN exchange rate, you are highly advised to always follow the oil market closely, economic and political activities for guidance on how the dollar exchange rate will play.

Personally, I feel this is one of the reliable fixed income investment (where to invest money in Nigeria during economic collapse) any parent can subscribe their kids to, why? despite the introduction of the investors and exporters windows, Nigerian is still an oil economy and such dependency makes us prone to a sudden economic shock, that may scare foreign investors.

How You Can Invest In US Real Estate Market Without Buying Properties

Investing In US Real Estate Market For Foreigners – From Nigeria, Canada, UK, Australia – Foreign Property Investment Guide To Make Low-Risk, Steady Dollar Dividend Returns
This guide is focused on helping foreign retail investors in Nigeria, Canada, UK, Australia or any other foreign countries, who would love to earn a steady income from American real estate market but do not have the capital to buy properties.
Housing is one the biggest driver of wealth in the US. A lot of investors who took advantage of the real estate crash in America are currently reaping a significant return on their purchases, over 300% in more than 10 years, as home prices have rebounded and risen above its pre-market crisis level. As home purchase prices soar higher on a monthly basis, it is even more difficult for first-time investors with less cash to enter the market. In this article, you will see how to explore property alternative investment options that will guarantee safer and quicker returns without following the due process of investing in physical properties.
Let’s quickly do a brief review of US housing market and where the low-risk, high-return opportunities for foreign investors who don’t have millions to buy homes or invest in property, yet still want to earn great returns from the booming housing market.
Please note that I wrote this guide in 2016 when I discovered these opportunities, I will try to update most of the data here to reflect the housing market trend in 2017 and if you feel some data aren’t close to market realities, please share your comment.

Best Low-Risk, High Return Fixed Deposit Investments You Didn’t Know

Best Investment Opportunities In Nigeria – Where To Invest Your Money With High Return, Low Risk – List Of Untapped Fixed Income Financial Opportunities This Year.

When I drew the business model and jotted-down content ideas of this blog, I never considered alternative fixed income investment opportunities as a category to be added too soon, but as a flexible investment entrepreneur who listens to the subscribers’ request, I felt it isn’t a bad idea to talk about the investment options you can explore (amidst rising cost of living) beyond the stock market but with key focus on risk tolerance and capital protection. Besides, it is not everyone that can swallow the risk that comes with stock investing.

My focus on risk here means that I would be screening investment options strictly on legal, risk level and return potential; I can’t undertake a long or short term investment that wouldn’t let me sleep well at night, if it’s going to make me get worried, then I won’t give it a try, that’s my mantra.

I had some idle cash that generated from financial services rendered to a corporate client and decided to scout for the best alternative investment opportunities in Nigeria offering high-return above and twice the inflation rate of 11 – 13% in 360 days with the lowest risk of capital loss. This time, I wasn’t going save the cash and allow my bank use it for business nor go for the fixed deposit investment return option of 8 – 9% p.a offered by our local banks, I wanted something better than bank and money market rates. Besides, my benchmark rate was set at 15% per annum (the average inflation rate figure as of this writing) which makes it even more difficult to find a financial investment opportunity offering such a higher return at low risk.

From 2014-2017, 1-year treasury bills offered up to 22% but as economic risk reduces on the back of a bullish oil market and stable exchange rate, it went down to 15%. So, if you had been a firm believer of TBs as the best-fixed income investment, you probably should re-think your portfolio allocation.

The only investment that could possibly beat the inflation rate of 11-13% is the one invested in professionally managed equity mutual fund with a track record of impressive positive performance. Some of these funds posted up to 52% return on investment in 2017; if you had invested N1m, you would have ended the year with a portfolio value of N1.52m.

You know what? I still wouldn’t give it a try because the stock market isn’t devoid of risk, this is not cash I would love to expose to share price fluctuation in short-term. After all, a lot of equity mutual funds also posted a negative return.

Mutual funds, like I said, are good long-term investment options; managers of these funds basically pick stocks that will deliver long-term gain from share price appreciation and dividend income growth.

On a lookout for other lower risk short term opportunities, I discovered the three emerging high yield and secured investment providers no one is actually talking about, while these investments are still new in Nigeria, some smart businesses entrepreneurs like us are already cashout from the model. It is a lending business opportunity.

You are aware of loan lending platforms in Nigeria like Pay later, C24, Kia-Kia, etc. These guys are taking advantage of the personal finance loan business gap banks couldn’t fill to generate billions of naira.

Let’s take a look at a personal loan lending platform and how much they charge as interest when you request for loan:

Best Investment Opportunities In Nigeria

This snapshot above is the interest repayment of N115, 028.69 payable monthly on N620,000 loan request with 7 months tenor. You can see the total amount payable at maturity, N805, 200.83 which is equivalent to 29.8% interest return to the lender.

Isn’t this outrageous? Now, imagine the number of users who request for a loan every day!

My dear, this is what banks make on you when you keep your cash in a savings deposit account for 7 months and in return pay you 1.75% interest (3% x 7/12 months).

These lenders, because they may not have enough capital to finance growing loan request, resort to borrowing more cash from individuals or corporate organisations with a promised return of up to 20 – 39%. The financial opportunities here is to plug in as a registered lender who gives to this registered and CBN-regulated credit company and earn a higher return than the rate on fixed deposit and treasury bills investments.

Click here to Download and Gain Access to all Untapped High-Yield Fixed Deposit Providers in Nigeria & Earn Up to 20-39%

Best Investment Opportunities In Nigeria With Low Risk and High Return

The potential of fixed deposit investment opportunities is no longer held by banks again but personal finance and SME loan lenders who are able to charge higher interest on a quick personal loan to salary earners or business owners to finance short-term needs. The companies have perfected borrowers’ credit and background checks to the extent that they only approve loan whose default ratio is less than 0.5%.  To encourage quick payback, they initiated a model that compensates borrowers who pay on/before maturity with higher loan disbursement, such that if they meet up to their current obligations, they can request for more loan.

Here are the 3 credit providers you can invest in:

Option 1

This is a licensed microfinance bank that offers consumer finance banking services. They started as a credit company before they got approval from the CBN to carry out microfinance operation.

As a lender on their platform, you can enjoy a higher return of up to 22% per annum depending on your capital.  Here is a table showing your deposit sizes, duration and percentage return.

Best Investment Opportunities In Nigeria

This micro-credit company requires an online registration of potential lenders and verification of identities using BVN and government-issued ID card before approval and if you are successful, you would be required to deposit into their corporate account, once payment is confirmed, you will receive an investment certificate showing the amount invested, maturity date, tenor, rate, WHT and full value.

Here is a typical return on N400,000 invested I invested in this company for 360 days:

best investment opportunities nigeria

Please note the following:

  • The interest on this investment is subject to 10% Withholding Tax (WHT).
  • The investment and the accrued interest will be rolled over at the prevailing money market rate if we do not receive instruction from you on or before the maturity.
  • The terms and conditions as contained in the Fixed Deposit Account Opening Form are hereby incorporated by reference with the same force and effect as though fully set forth herein, which terms and conditions may be changed by the company at any time without prior notice.
  • The terms and conditions contained in the Fixed Deposit Account Opening Form can be accessed via Terms and conditions
  • Where you request to withdraw funds prior to the maturity date, the may, in its absolute discretion, approve/reject a request for early withdrawal. Where such early withdrawal is approved by the company, a penalty charge of 50% of the accrued interest will be applied.

Option 2 (Exclusive)

This lender offers a better and higher return of 26-39% per annum compared to one mentioned above. The attractive feature of this investment option is that your interest rate is not dependent on deposit size of N20,000, besides, all loan disbursed are insured which means that if borrowers defaults, there is a chance of recouping your cash back.

Best Investment Opportunities In Nigeria

This is how this option works:

  • Browse loans to creditworthy borrows who have passed all18 different credit check and loan criteria.
  • Lend to borrowers at a higher rate.
  • Earn monthly return; direct deposit to your bank account.
  • Pay 1.5% of your return as operation fee.

Options 3 (Exclusive)

This provider has disbursed over N20 billion to 400,000 salary earners in Nigeria.

This is a sample advert from this credit company on BusinessDay Newspaper, one of the most respected business and investment dailies in Nigeria.

Best Investment Opportunities In Nigeria

As I said, these three platforms are registere and regulated by the Central Bank of Nigeria, so you are assured of capital protection and returns on maturity.

When I discovered these platforms, I don’t even bother about investing in my bank’s fixed deposit offer of 6-9% per annum when I can earn a solid low-risk return of 20-39% per annum.

Would you still invest in your bank’s fixed deposit? I guess it’s a capital NO, then, Click here to Download and Gain Instant Access to the Contact of these Untapped High-Yield Fixed Deposit Providers in Nigeria and Earn Up to 20-39% Per Annum

Contact: You can contact me for inquiries and questions on 08084219399. These providers are CBN regulated and NDIC insured.