A Comprehensive Overview of the Nigeria Exchange Group (NGX)
A Comprehensive Overview of the Nigeria Exchange Group revealed. We compiled an overview of the Nigeria Exchange Group for Nigerian Traders.
This is a complete overview of the Nigeria Exchange Group (NGX).
In this in-depth guide you’ll learn:
- What is the Nigeria Exchange Group?
- Which stocks can you buy on the NGX Group?
- Our recommended stocks to buy for Nigerian Beginner Traders?
- A comprehensive analysis of the Nigeria Exchange Group Index.
- How to compare stocks against each other?
- How to analyze the stock price list for Nigerians.
- Which stocks can you buy with a low minimum deposit of $5 (2 075 NGN)?
- Which brokers offer a signup bonus for first-time traders?
And lots more…
So if you’re ready to go “all in” with the Nigeria Exchange Group…
Let’s dive right in…
- Louis Schoeman
A Comprehensive Overview of the Nigeria Exchange Group (Updated 2023)
- What is the Nigeria Exchange Group (NGX)?
- How to buy stocks on the Nigeria Exchange Group: a step-by-step guide
- Pros of trading shares on the Nigeria Exchange Group
- Cons of trading shares on the Nigeria Exchange Group
- What is the difference between a stock and a unit trust?
- Nigeria Exchange Group at a Glance
- Best Stocks to Trade in Nigeria
- FAQ
What is the Nigeria Exchange Group (NGX)?
👉 The Nigeria Exchange Group is a Nigerian stock exchange that was established in Lagos in 1961.
👉 There are 161 publicly traded firms as of November 2019, with 8 domestic corporations listed on the premium board, 144 corporations listed on the main market, and four corporations listed on the Alternative Securities Market (ASeM) board.
👉 84 Federal Government Bonds, 21 State Bonds, 27 Corporate Bonds, 1 Supranational Bond, and 53 Memorandum Listings are available on the NSE’s Fixed Income market.
👉 The objective of the National Stock Exchange is to enable firms and investors to have dependable access to capital while also providing secure saving methods and a stable organizational structure for successful and efficient corporate operations and management.
How to buy stocks on the Nigeria Exchange Group: a step-by-step guide
Step 1: Sign up with a reputable stockbroker
👉 Using an online stockbroker is the quickest and most convenient way to purchase stocks in Nigeria. As soon as you have opened and financed your account, you will be able to purchase shares and stocks through the brokerage firm’s website.
👉 The employment of an all-inclusive stockbroker or direct purchase of shares from the company are two more options available.
👉 The process of starting an online account is similar to that of opening a bank account – fill out an application for the account and attach a photo ID, and then pick whether you want to fund the account with an electronic fund transfer or with your own dollars.
Step 2: Research the best stocks to buy
👉 Following the completion of the account opening and funding process with a brokerage firm, you are now prepared to begin the process of selecting stocks on the Nigeria Exchange Group.
👉 When conducting your research, avoid becoming overwhelmed by the torrent of information and real-time market movements.
👉 Make your objective crystal clear. Finding businesses in which you would like to be a part-owner is the ultimate goal of the best stock brokers in Nigeria search process.
👉 Be prepared to do an inquiry once you have identified these companies and companies that you have identified. A summary of what is happening in the company will be provided to you in the letter, as well as some context for the numbers that will be included in the document.
👉 The majority of the information and tools required to evaluate the company can be available on the broker’s website, such as transcripts of SEC filings, quarterly earnings reports from conference calls, and the most recent News.
👉 The majority of online brokers offer detailed instructions on how to use their tools, in addition to basic training on how to select stocks.
Step 3: Decide on the number of shares you wish to purchase
👉 There should be no pressure on you to purchase a specific amount of shares or to purchase your entire portfolio at the same time.
👉 Begin by purchasing a single stock to gain an understanding of the experience of owning individual stocks and to determine whether or not you are prepared to weather difficult times. When you have mastered the approach of shareholders, you will be able to expand your shareholding.
👉 Unit investors who are just getting started may be interested in fractional stocks, a new option offered by online brokers that allows buyers to purchase a small portion of a share rather than the complete stock at a discounted price.
👉 This means you may invest in pricey stocks such as Google and Amazon, which are well-known for their four-figure stock prices, with less money than you would otherwise be able to afford.
Step 4: Choose the best stocks for your portfolio
👉 Find stocks that suit your investment profile and which provide you with the greatest amount of asset diversification for your portfolio.
Step 5: Place a market order
👉 You place a market order when you want to buy or sell shares at the highest market price at the time of purchase or sale.
👉 Market purchases do not have price constraints, therefore your order will be filled promptly and completely, even if you are attempting to buy one million shares and subsequently attempt to seize control of the company.
👉 Never be startled if the price you pay for your chosen share (or get in return for selling it) differs from the price you gave only a few seconds before. Over the course of the day, the bid and ask prices fluctuate regularly as well.
Step 6: Put limit orders in place
👉 Limit orders are an excellent choice for investors who buy and sell smaller trade stocks, which are more likely to be based on spreads than on fundamentals, relying on investor activity.
👉 Also, when the stock market is experiencing short-term volatility or when price is more essential than order fulfilment, they can be an excellent tool.
👉 There are additional criteria that you can place on the limit order in order to limit the amount of time that the limit order remains active. An “all or none” (AON) order can only be filled if the prices of all of the equities in which you wish to trade are within the price range you specify.
👉 Unfilled orders that are marked as “good for the day” (GFD) expire at the close of trading for the day, regardless of whether the order has been fully executed.
👉 If a buyer decides to cancel an order, the order is considered to be “good until cancelled.” If the order is cancelled, the order is considered to be “good until cancelled.”
Pros of trading shares on the Nigeria Exchange Group
Long-term profit growth
👉 Thus far, the Nigeria Exchange Group has provided investors with substantial profits. Another significant advantage of investing in stocks is the potential to be patient and watch your money compound and grow over the long term.
👉 Despite the fact that the values of individual stocks fluctuate on a daily basis, the aggregate value of the stock market continues to rise.
👉 Following a review of numerous asset classes, it is clear that the stock market has historically provided the best returns for investors, surpassing all other types of financial assets as well as the housing market over a period of several decades.
👉 While previous performance is no guarantee of future results, the data suggests that investing in equities over the long term, if done correctly, can produce favourable benefits.
Income earnings from dividends
👉 For many shareholders, the dividends paid by the corporation represent a significant portion of their profits and serve as a source of income. Dividends are often paid out once a quarter, however not all firms do it in this manner.
👉 Alternatively, they may elect to reinvest the profits back into the business. In order for firms to disperse a portion of their profits to shareholders, even if the stock’s value has declined, they must pay dividends to them.
👉 Dividends obtained as a result of stock ownership can provide investors with a variety of advantages. Dividend payments can help you earn a higher total return on your stock investment by increasing your total return.
👉 They also contribute to minimize volatility in stock prices by assisting in the support of the stock price.
Asset diversity
👉 In the stock market, investors can choose from a diverse variety of financial instruments such as stocks, bonds, mutual funds, and derivatives, which provide them with a diverse choice of securities to invest in, depending on their risk appetite and financial objectives.
👉 Investment in a diverse range of companies also provides excellent diversification by reducing the concentration of your portfolio.
👉 In addition to allowing for a greater diversity of investment portfolios and the balancing of market risks, this flexibility is important in lowering the risks associated with stock investing.
👉 A well-diversified portfolio contributes to the accumulation of wealth by capitalizing on growth in many sectors of the economy, resulting in a profit even if the value of some individual companies declines.
Opportunities for ownership
👉 Purchasing stock in a corporation effectively equates to acquiring a share in that company. A shareholder typically has the ability to participate in the decision-making process of the company.
👉 It is because of their ownership in the company that the shareholders are able to influence management to make decisions that are advantageous to their interests.
Cons of trading shares on the Nigeria Exchange Group
The risk of company decline
👉 Investors who purchase individual stocks are more likely to be exposed to company-specific risk, which is the most common type of risk.
👉 Investors may suffer a financial loss if the company in which they have invested does not generate sufficient revenue or profits. Unsatisfactory operational performance can also cause a company’s stock price to plummet in the stock market.
Exposure to headline risk
👉 Headline risk is frequently regarded as a subset of overall company risk. This is the risk associated with articles in the media that have the potential to harm a company’s business and reputation.
👉 A single unfavourable headline can trigger a market reaction against a specific firm or an entire industry, and in many cases, both.
Exposure to market risk
👉 As an investor, you may suffer losses as a result of the generalized systemic risk that afflicts the financial markets as a whole. Stock market crashes, for example, are an illustration of increased market danger. Market risk cannot be completely eliminated, but it may be mitigated.
Exposure to liquidity risk
👉 Stock market investing involves a significant amount of risk, which is intuitively understood as “liquidity risk.” While most equities and exchange-traded funds (ETFs) are quite liquid, not all of them are created equal.
👉 Some penny companies and small-cap stocks, in particular, may experience difficulties in terms of liquidity. The seamless purchase and sale of these securities at their fair market value could become a source of frustration for investors.
What is the difference between a stock and a unit trust?
Understanding stocks
👉 Generally speaking, stock (also known as equity) is a financial instrument that reflects ownership of a portion of a firm.
👉 This allows the owner of the stock to a share of the corporation’s assets and profits in proportion to the amount of stock they own in the company. The term “share” refers to a unit of stock.
👉 Many individual investors’ portfolios are built around the purchase and selling of stocks, which are mostly traded on stock exchanges (though private sales can occur as well).
👉 These transactions must be compliant with government regulations that are intended to protect investors from deceptive or deceptive acts or practices.
👉 Over the long term, they have historically outperformed the majority of other assets. A large number of internet stockbrokers offer these types of investments for sale.
Understanding unit trusts
👉 A unit trust is a type of mutual fund in which your money is pooled with the money of other investors in order to invest in a portfolio of assets that is managed by a fund manager in accordance with the fund’s investment goal.
👉 Rather than selecting individual assets to invest in, when you invest in unit trusts, you are investing in a diversified basket or portfolio of securities managed by professional fund managers that have been carefully screened and placed on a distributor’s shelf for you to invest in, rather than selecting individual assets to invest in.
👉 For those seeking a hassle-free way to invest, diversity while only requiring a small initial investment, and the ability to delegate the analysis and selection process to experts, unit trusts may be an excellent choice.
👉 Of course, as compared to direct securities investment, this has lesser potential profits while also posing a reduced risk.
Nigeria Exchange Group at a Glance
| 📊 Stock trading volume | 7.370 Unit bn |
| ⚖️ Government Regulatory Body in Nigeria | Securities and Exchange Commission (SEC) |
| 📍 NGX Physical Address | 2 Custom Street, Lagos Island, Lagos, Nigeria |
| 📞 Phone number | +234 (700) 225-5649 |
| 📧 Email Address | [email protected] |
| 🌐 Website | www.ngxgroup.com |
| ⏰ Operating hours | Monday through Friday from 10:00am to 2:20pm West Africa Standard Time |
| 🥇 Chairmam | Oscar N. Onyema OON |
| 📱 NGX official twitter page | @ngxgroup |
| 📱 NGX official Wikipedia page | Official Wikipedia page |
| ✔️ Is stock trading legal in Nigeria? | Yes |
| 💸 Do you get taxed on stock trading profits? | Yes |
| 🥇 Which is the number one stockbroker in Nigeria? | Morgan Capital Securities |
| ⏰ When is the best time to trade stocks? | 9:30 –10:30 a.m. ET |
| ⚖️ Top regulated stockbrokers in Nigeria | Exness, FXTM, AvaTrade, XM, IG Group |
| 💰 How much money do you need to get started with stock trading in Nigeria? | N3,380 |
| 💻 Which is the fastest growing broker in Nigeria? | Exness |
Best Stocks to Trade in Nigeria
Wema Bank Plc (WEMABANK)
👉 Financial services are provided by Wema Bank Plc, a Nigerian financial institution that serves individuals, small businesses and major enterprises.
👉 Savings accounts, loans, overdrafts, revolving credit, and various other services are available in addition to transactional and savings accounts. Bill collecting, shipping document management, and other services are examples of trade services.
👉 Services that help small enterprises, foreign currency, cash management, retail management, as well as integrated revenue services are all available.
Academy Press Plc (ACADEMY)
👉 Annual reports, books, magazines, and marketing materials for companies can all be printed at the Nigerian printing facility, Academy Press Plc.
👉 Among the company’s subsidiaries are Academy Press Specialised Print Services (which prints documents with high levels of security risk, such as tickets, vouchers, letterheads, invoices, and continuous forms for computer use) and West African Book Publishers (WABP), which publishes high-end publications for the discerning reader.
👉 Academy Press Specialised Print Services is a division of Academy Press Specialised Print Services.
Scoa Nigeria Plc (SCOA)
👉 In addition to selling, maintaining, and leasing automobiles, Scoa Nigeria PLC also assemble, sell, and service power generators, as well as selling, servicing, and repairing a variety of other equipment.
👉 The corporation was founded in Lagos, Nigeria, in 1926, and it continues to have its headquarters in that city. SCA International S.A. owns SCOA Nigeria Plc, which is a subsidiary of SCOA Nigeria Plc. SCA International S.A. also owns SCOA Nigeria Plc.
Guinness Nigeria Plc (GUINNESS)
👉 Harp Lager is produced and distributed by this brewery, which also produces and sells Guinness Extra Stout and Smooth, Guinness Malta, and Gordon’s Spark.
👉 Others include Smirnoff Ice, Armstrong Dark Ale, Satzenbrau Pilsner, Top Malt, Harp Lime, Dubic Extra Lager, and Malta Guinness Low Sugar, to name a few. Guinness is the second-largest beverage brand in Nigeria, trailing only Coca-Cola in terms of market share.
PZ Cussons Nigeria Plc (PZ)
👉 Nigerian consumer goods manufacturer and distributor PZ Cussons is a publicly-traded company that manufactures and distributes products such as laundry detergents, toiletries, soaps, and household appliances.
👉 PZ Cussons Holdings, based in Manchester, owns the vast majority of the company’s equity through its wholly owned subsidiary.
👉 PZ Cussons Nigeria Plc began the year with a share price of 6.10 NGN and has since climbed by 73 percent, putting it in sixth place on the Nigerian Stock Exchange for year-to-date performance, according to the company’s website.
Learn Africa Plc (LEARNAFRCA)
👉 Learn Africa Plc is a publishing and distribution company that produces educational tools for students at all stages of education, from pre-school to college.
👉 The corporation is a participant in the book-publishing business. It offers a diverse selection of reading resources, including academic, business, and recreational literature.
Presco Plc (PRESCO)
👉 Presco Plc is a major player in Nigeria’s agro-industrial industry, and it is headquartered in Lagos. In addition to establishing oil palm plantations, the company engages in the milling and processing of palm oil as well as the refinement of vegetable oils, among other things.
👉 The company’s key areas of expertise include the extraction, refinement, and fractionation of crude palm oil into vegetable oil and palm stearic acid.
👉 Other areas of expertise include the production of palm stearic acid and palm stearic acid. Presco’s share price has risen by 51.5 percent since the beginning of the year, making it the ninth-best performer on the NGX so far this year after starting the year at 87.80 NGN.
Courteville Business Solutions Plc (COURTVILLE)
👉 Courteville Business Solutions Plc is a Nigerian e-business solutions development company that was established in 2005. It provides financial management and counselling services, business solutions, e-commerce, and internet marketing services, amongst other things.
👉 Data capture, retail channel distribution, dedicated and cloud hosting, as well as tax administration consulting services, are just a few of the e-business solutions provided by Courteville Technologies Inc.
NPF Microfinance Bank Plc (NPFMCRFBK)
👉 NPF Microfinance Bank Plc is a Nigerian community bank that was established in 2005. The major goal of the organization is to provide banking and other regulated financial services to low- and moderate-income individuals and small enterprises in Nigeria, with a special emphasis on police personnel.
👉 The company was founded in 1999 by two Nigerian entrepreneurs. Retail banking, loan and advance granting, as well as other associated services, are all included in the company’s offerings to its customers. The bank has a total of 28 locations across the country.
👉 NPF Microfinance started with a share price of 1.70 NGN and has since increased by 46.5 percent, putting it in tenth place on the NGX in terms of year-to-date earnings, according to the company.
Meyer Plc (MEYER)
👉 As one of the leading companies in the manufacturing industry, Meyer PLC (previously DN Meyer Plc) is a well-known name.
👉 Painting is a major activity for Meyer Plc, which manufactures and sells paints locally as well as internationally. Paints, trading property, and corporate operations are all divisions of the corporation.
👉 As of today, Meyer’s stock has risen 43.5 percent from its initial public offering (IPO) price of 0.46 NGN, ranking it 11th on the Nigerian Stock Exchange in terms of year-to-date performance.
👉 Holders of MEYER stock have good cause to be optimistic, since the stock has gained 20 percent in the last four weeks, putting it in sixth place on the New York Stock Exchange.
FAQ
What is the minimum amount needed to buy shares in Nigeria?
Typically Nigerians should set aside approximately N3, 380 to start stock trading effectively.
How do I buy shares on the NGX?
In order to buy shares in the primary or secondary market, an investor must appoint a securities dealer/stockbroker who is a registered Trading License Holder of NGX to facilitate account opening and trading.
What is the Nigeria Exchange Group?
The Nigeria Exchange Group is a Nigerian stock exchange that was established in Lagos in 1961. The objective of the National Stock Exchange is to enable firms and investors to have dependable access to capital while also providing secure saving methods and a stable organizational structure for successful and efficient corporate operations and management.
Who regulates the Nigerian stock exchange?
The stock exchange in Nigeria is regulated by the Securities and Exchange Commission (SEC).
Is stock trading legal in Nigeria?
Yes, stock trading in Nigeria is fully legal as long as it is conducted through a legal complaint and regulated broker.
Conclusion
👉 Overall, the Nigeria Exchange Group is the leading stock exchange on the African continent that provides Nigerian traders access to a diverse selection of local and international stocks. Stock trading on the Nigeria Exchange Group can be done online through a regulated broker.
Top 3 Brokers
