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<\/a><\/div>After Recession What is Next?<\/a><\/h2>- <\/i>Mr Ambrose<\/a><\/li>
- <\/i>September 7, 2017
- <\/i>Latest Updates<\/a><\/li><\/ul><\/div><\/div>
Are u prepared for\u00a0market correction 2 protect your portfolio and even profit from this correction? If you\u2019re not sure, join me Sept 9, at Blumy Guest House,51\/53 3rd\u00a0<\/span>Avenue, Behind MTN Office, Gwarinpa Estate Abuja, when I\u2019ll share my powerful defensive strategies and demonstrate how you can actually profit from the recovery market and economy.<\/p>\nPlus, I\u2019ll also show you how to:<\/p>\n
\n- Get the signals that alert you to buy or sell<\/li>\n
- Better time entries and exits<\/li>\n
- Avoid over-hyped stocks and other landmines that can destroy portfolios<\/li>\n
- Use the proven \u00a0Investdata Buy & Sell Signal Setup to trade and invest profitably<\/li>\n
- Anticipate whether a stock is likely to beat or miss earnings estimates<\/li>\n<\/ul>\n
This event is filling up quickly so and secure your spot and enjoy 20% discount on all our home pack study materials that will boost your understanding and knowledge to profit from stock market investment.<\/p>\n
<\/p>\n
Registration fee is just N1,000 online. CLICK HERE TO REGISTER<\/a><\/strong><\/em> <\/span>or at the venue.<\/p>\nHope to see you there,<\/p>\n
Ambrose Omordion<\/p>\n
Founder & CRO | Investdata Consulting Ltd<\/p>\n<\/div>
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<\/a><\/div><\/i>Performances Support Dividend<\/a><\/h2>- <\/i>Mr Ambrose<\/a><\/li>
- <\/i>November 22, 2016
- <\/i>Latest Updates<\/a><\/li><\/ul><\/div><\/div>
Despite the seeming associated risk, equity investment has proven to be the best performing investment window, whether in a bullish or bearish market when compared to other investment options like bonds and fixed income instruments in the money market. Typically, stock returns are derived from capital appreciation, dividends and even bonus issues. Dividends payment have historically accounted for 20 to 40 percent of the average annual stock market returns. A lesser known fact is that reinvested dividends have provided for between 44 to 97 percent of historical stock market returns.<\/p>\n
During tough market conditions such as the down market that we are now experiencing, investors should realize that counting their losses will not prevent further losses. They should rather change their investment perception and tag along with the market as it presents itself. Investors should take advantage of the opportunity of low priced equities to position in the market in anticipation of full year earnings of quoted companies in the first quarter of 2017, considering the present high dividend yield of stocks.<\/p>\n
For now, there is no expectation of corporate results that will influence prices of stock, but with external forces or information that can drive the nation stock market since the liquidity level remains tight and the government has failed to look into the plight of its citizens that have lost fortunes in the market as a result of deteriorating economic situation. The falling prices of equities on the floor of the exchange has pushed dividend yield of many stocks and some sectors up.<\/p>\n
But given the uncertainty of corporate earnings amidst the current economic slowdown, the market is probably showing that the dividend cut which has largely been concentrated on the manufacturing sector would spread over to other industries as well. Investors should be careful as the outlook for dividend growth in general in 2017 is slim, since some of the recent released earnings have revealed how many companies would be next year.<\/p>\n
However, if you can achieve at least anything above 8% yield to cover the half rise in inflation you would be able to weather any short-term and long-term weakness in the stock market. This does not mean that I am recommending a huge portion of your long-term portfolio in bonds, which are normally sold to retirees as a \u2018safe and reliable source of income.\u2019 You do get a fixed payment every period or so, but the purchasing power of this payment declines over time.<\/p>\n
Thus a very good strategy over the long run is to create a diversified portfolio of stocks, that have shown consistency in raising their dividends year after year and which spot an attractive dividend yield for your consideration. Here, it\u2019s necessary for investors to know how the yield is computed whether based on forecast or historical dividend. \u00a0\u00a0Dividend yield is calculated by what have been paid by dividing the latest dividend with the current market price of the company. Higher yield does not guarantee increase in dividend payout.<\/p>\n<\/div>
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<\/div><\/i>Importance of Dividend, Products and Company Size In Equity Investing.<\/a><\/h2>- <\/i>Mr Ambrose<\/a><\/li>
- <\/i>November 22, 2016
- <\/i>Latest Updates<\/a><\/li><\/ul><\/div><\/div>
The market has suffered huge losses as it continued its southward trend in the past months and weeks before finding new support level that brought the oscillating trend we saw in the recent weeks. This is an indication that the expected market recovery is underway despite that the companies and market fundamentals that are to influence equity price are still very weak for now but when positive information and improve macroeconomic indices start emanating in the weeks ahead it will support the recovery move.<\/p>\n
Increasing unemployment rate, due to high cost funds as a result of high interest rate, high cost of governance, dwindling value of naira as a result of falling oil price, low purchasing power and weak Q3 corporate earnings have affected the market hugely. Also, the government economic blueprint has not given direction yet to guide foreign and local investors decision. The uptrend witnessed in the first trading week of August was attributed to sentiment on low prices of equities as smart money consolidate their positions in some companies. The current high dividend yield and margin of safety should guide discerning investors seeking opportunities to grow their portfolios and build wealth. They should buy quality stocks even as the market decline in the face of expected recovering. Targeting companies with consistent history of dividend payment on quarterly or yearly basis. Research has shown that companies with a policy of consistently increasing dividends have outperformed the market on many occasions. Dividend paying stocks put cash in your pocket and help you to counter inflation.<\/p>\n
Unlike earnings, dividends cannot be manipulated or faked; dividends provide continuous feedback on company\u2019s performance. As time passes dividend investors see their income steadily grow. You do not have to wait five to 10 years to determine if the strategy is working.<\/p>\n
Reinvested dividends provided a significant portion of the historical equity return; performance in any given year is driven by capital appreciation, but long-term returns are largely the result of reinvested dividends. Good companies grow their investors\u2019 dividends: you expect your employer to give you a raise periodically. Why wouldn\u2019t you expect the same from your investment?<\/p>\n
Spending dividends in retirement does not harm your investment. In addition, a good dividend portfolios can be given to your children and grandchildren. A dividend portfolio is relatively cheap to maintain. We strongly advise that dividend paying stocks should have a spot in everyone\u2019s portfolio, especially in a time like this.<\/p>\n
Another key factor to successful investment in this kind of market is to invest in companies that are leaders in their business and industry. If the company is key player in its sector then it can raise prices to keep up with inflation but not in every situation. The market leaders can easily raise capital and survive economic downturns considering the nature of their products and services that have no close substitute. These companies are money spinners with healthy cash flows. As an investor you may take a full position in some stocks right now at a better price. There are some good quality stocks around that are immune to market selloff, meaning that after profit taking or free fall of the market, some companies share prices bounce back on the strength of its profitability and earnings.<\/p>\n<\/div>
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<\/a><\/div><\/i>Stock Terminologies<\/a><\/h2>- <\/i>Mr Ambrose<\/a><\/li>
- <\/i>November 22, 2016
- <\/i>Latest Updates<\/a><\/li><\/ul><\/div><\/div>
Recently, I went for a meeting with a top executive of the company managing my website. After the meeting, I also used the opportunity to see one of the executives who has been my client for the past 9 years and anytime I used some stock terminologies which he will say \u201cAbeg you don start again talk wetin I fit understand.\u201d<\/p>\n
So, I had to explain in simple terms that he could understand and easily relate with. So, in today\u2019s blog, we will be looking at some types of stock, what is a bear and bull market etc.<\/p>\n
How Many Types Of Stocks Are There?<\/strong><\/p>\nThere are two main types of stocks that investors can own: common stock and preferred stock.<\/p>\n
When people talk about stocks they are usually referring to common stocks because, well, they\u2019re common and they are the majority of the stocks issued. Both of these stocks represent ownership in a company but preferred shares normally come with a fixed dividend unlike the common stock, which has variable dividends. People may choose preferred stocks because in the event of liquidation, preferred shareholders are paid off before the common shareholders.<\/p>\n
Bull Market<\/strong><\/p>\nIn bull market everything in the economy is going well. Stocks are rising, unemployment is low and the economy is growing.<\/p>\n
Bear Market<\/strong><\/p>\nA bear market also does not last for a set term as it can go on for years. During this period, investors have a hard time picking profitable stocks.<\/p>\n
What Is An \u201cIlliquid Market\u201d?<\/strong><\/p>\nIlliquid defines an asset or security that is not able to sell quickly due to a lack of buyers and sellers in the market. Selling it quickly would result in a loss of profit. A market would be described as illiquid if there is a shortage of interested buyers and little is being traded.<\/p>\n
The above were basically the clarification I discussed despite the fact that he has been a longtime investor. Although it may look ordinary to those who already understand but I believe that it will go a long way to help you have a better understanding of stock market reports and analysis<\/p>\n<\/div>
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<\/a><\/div><\/i>Diversify Your Portfolio To Safeguard Against A Market Downturn<\/a><\/h2>- <\/i>Mr Ambrose<\/a><\/li>
- <\/i>November 22, 2016
- <\/i>Latest Updates<\/a><\/li><\/ul><\/div><\/div>
Before the crash of the stock market in 2007, I could still remember how I lost 70 million naira worth of stocks. Although, I perceived that most the stocks that were on the rise have no basis, in fact some of them have closed down years ago.<\/p>\n
I had the facts, knowledge but it was too good to be true so I had to put all my investment in those stocks which made me lost that kind of amount. Usually, I would sell the stocks then give each investors their money then go home and be watching but non compliance with fact led me into such mess.<\/p>\n
In today\u2019s blog we will be looking at Diversify Your Portfolio To Safeguard Against A Market Downturn<\/h3>\n
As an investor, you\u2019ve likely enjoyed a steadily rising market one time or the other. But what can easily be forgotten amidst a rising market is the perils of a downturn, and how much return it would take to recover losses. The truth is, recovering losses is much more difficult than many investors may realize. It\u2019s important that you take a careful approach when building your portfolio to minimize risk and losses.<\/p>\n
Understanding the pit falls of losing money can help mitigate loss aversion, which describes people\u2019s tendency\u00a0to prefer avoiding\u00a0losses\u00a0to acquiring gains.<\/p>\n
Let\u2019s take a N100,000 portfolio for example. If that portfolio loses 30% (N30,000), what is the percentage that the remaining N70,000 must earn in order to get back to N100,000? Many think that a 30% gain would be needed to get back to breakeven, but that\u2019s incorrect. Let\u2019s break it down a little bit further. A 30% gain on the remaining N70,000 is only N21,000 and would only bring the portfolio to N91,000. In reality, it would take a 42.9% gain just to recover the 30% that was initially lost. See the below for some more examples:<\/p>\n
\n- For a 20.0% loss, you will need a 25.0% return to break even<\/li>\n
- For a 30.0% loss, you will need a 42.9% return to break even<\/li>\n
- For a 40.0% loss, you will need a 66.6% return to break even<\/li>\n
- For a 50% loss, you will need a 100.0% return to break even<\/li>\n<\/ul>\n
\n- For a 60.0% loss, you will need a 150.0% return to break even<\/li>\n<\/ul>\n
As demonstrated above, the required return rate for breakeven increases at a much faster rate as the loss increases.<\/p>\n
You\u2019ve heard it before: Protect your portfolio by diversifying<\/strong><\/p>\nThe inherent difficulty of regaining losses in a downturn is just another reason why diversification of your portfolio is critically important.<\/p>\n
A diversified portfolio (one containing multiple investment vehicles) will likely contain a mixture of stocks, bonds and cash. As opposed to having all of your money tied up in one stock or asset class, a diversified portfolio can help offset swings in the market.<\/p>\n
Understanding your risk tolerance, or how well you can handle big swings in the market, will allow you to set your financial goals accordingly. Setting realistic financial goals is a key step in developing an investment strategy for your portfolio. If you have a higher risk-tolerance (you can handle big swings in the value of your portfolio), your portfolio would contain more stocks than bonds. An example of a high-risk portfolio would be 80% stocks, 20% bonds. Adversely, an example of a lower risk portfolio would be 40% stocks and 60% bonds. In understanding your risk tolerance and goals, you will have a better understanding of how you are investing your money, and why you are investing in that manner.<\/p>\n
Stay informed on market activity<\/strong><\/p>\nAfter establishing a well-balanced portfolio, it is important that you avoid the \u201cset it and forget it\u201d mentality. Checking on your investments regularly and staying informed about market news will help you know if and when you need to get out of a particular investment. In addition, attend seminars and webinars organized by top experts in the field; you can join my facebook page www.facebook.com\/investdata on a weekly basis for live webinars and also ask any questions regarding stock markets \u00a0In case you find your portfolio deviating from your original investment plan, re-adjusting your investment allocations, or re-balancing, will help keep your portfolio in line with your investment goals.<\/p>\n
In conclusion, taking the time to craft a well-thought out plan for building a portfolio can help minimize losses and help you achieve your financial goals. Having a well-balanced portfolio can help reduce losses and make recovery much more manageable.<\/p>\n
<\/p>\n<\/div>
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<\/a><\/div><\/i>4 Ways Of Losing Money In The Stock Market<\/a><\/h2>- <\/i>Mr Ambrose<\/a><\/li>
- <\/i>November 22, 2016
- <\/i>Latest Updates<\/a><\/li><\/ul><\/div><\/div>
Just as there are several reasons why some investments make money, there are just as many, if not more, for why an investment loses money. More often than not, there is some investor error lingering in the background of a failed investment. Many investments lose money simply because of investor behavior which is trading based on emotion and not facts. Whether the investor is trading too often or not often enough which could affect the portfolio.<\/p>\n
However, when an investment loses money despite otherwise sound investing behavior on the part of the investor, reasons for the loss might go back to the company itself or unethical business practices.<\/p>\n
\n- No Customers: Consumers don’t buy the company’s products or services. It doesn’t matter if they have great products. No customers, No Money or profit to share. It is as simple as that<\/li>\n
- Effective Competition: This is very common. A company will release a new product in other to compete with the current reality of consumer behavior but at the end of the day nothing will really be achieved as a result of poor marketing technique, scaling, errors. I could still remember an advert done by Nigerian Brewery for their Star Lager brand in 2013 on yahoo. The link provided either by Nigerian Brewery was completely error 404 for 10days<\/li>\n
- Mismanagement of funds: The officers of the company mismanage the business, perhaps by fraud or by failing to follow a budget, and their costs exceed their income hence loss is inevitable<\/li>\n
- False Profit Declaration: the company’s profits are less than you were told, the contracts that were a “sure thing” never existed, or the financial statements were doctored up.<\/li>\n<\/ul>\n
Definitely, there are no bullet-proof investments or investment strategies, but there are patterns that can save you from significant loss. In the end, good investments that make money aren’t always the most exciting (in fact, they generally aren’t exciting at all), but the key is to find the balance between the risk and reward and not make those common investing mistakes which is by seeking knowledge by attending seminars, subscribing to monthly nugget on stock investment. Many people have made mistakes so it is better you learn from them<\/p>\n
<\/p>\n<\/div>
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<\/a><\/div><\/i>Stock Update<\/a><\/h2>- <\/i>Mr Ambrose<\/a><\/li>
- <\/i>August 16, 2016
- <\/i>Latest Updates<\/a><\/li><\/ul><\/div><\/div>
Market Update for the week ended July 1<\/p>\n
NSE Opens Q3 Red, Amidst Negative Macroeconomic indices and Earnings season <\/strong><\/p>\nThe Nigeria equities market opened trading activities for the third quarter under pressure, closing in red as investors went on a flight to safety while trying to reduce risk amidst growing political concerns in Nigeria and around the globe. The week recorded a four-day decline that saw the composite NSE All-Share Indexshedding 4.39%, as profit taking and effects of the Brexit vote a fortnight ago continued.<\/p>\n
Ahead of last Friday’s trading on the floor of the exchange, the NSEASI and market capitalisation were up about 3.34% and N314 billion respectively, for the first half of the year. This was attributed to market rebound in May and June as a result of the budget approval by the National Assembly and its signing into law by President Muhammadu Buhari after weeks of disagreements between the federal legislators and Presidency. Also, the new market-driven inter-bank foreign exchange policy that boosted investor confidence to wipe a four-month loss that turned many portfolios positive and into profit.<\/p>\n
Market performance for the period under review after a prolonged downtrend wasmild as the nation\u2019s stock market indices closed at 29,597.79 and market capitalisation at N10.17 trillion respectively, after touching a low of 22,330.96 and N7.72 trillion within the time under consideration. It however recorded improvement in market development and growth as technology transformed the face of the market to promote transparency that boosted both domestic and foreign investors\u2019 confidence. It also made\u00a0 trading and investing simple as more online platforms were opened with \u00a0investors now able to place trades from the comfort of their homes and offices, coupled with access to real market information that quicken\u00a0 investment decision as more operators create\u00a0 online portals for clients to trade directly on their own.<\/p>\n
Recall that within this period, macroeconomic indicators were inconsistent and negative to reflect the impact of global economic transition and monetary policies to reform the financial institutions after the crash of crude oil prices in international market. This has heightened exposure of many banks and financial markets in general. This triggered struggling in many economies of today which our nation is suffering from at the moment, coupled with nuclear fiscal and monetary policiesof the government. The slowdown in the system have reflected in the key indicators such as the Gross Domestic Product (GDP) that is currently\u00a0 in negative territories, inflation rate above 15% as at May and is likely to move higher when June statistics is released. Others are:high interest rate, high unemployment rate and \u00a0low exports, regardless of\u00a0 capital market indicators \u00a0moved to \u00a0positive direction. Nigerians are more dependent on imports, and while internal debt burden grew, so did the nation\u2019s investment in infrastructure. Oil prices were volatile and remained largely unfavourable, but stayingabove the 2016 Federal Government budgeted benchmark of $38 per barrel, after it had recovered 26% in the second quarter to record the biggest gain since 2009. If the current recovery of \u00a0oil price is sustained, the economy will likely rebound despite the slowdown being witnessed as the \u00a0government implements 2016 budget and provide palliatives to stimulate and drive the change concept to jump start the economy, create new investment opportunity that will influence the stock market and the economy positively.<\/p>\n
The stock market in many economies provide the barometer by which the economy is gauged, the Nigerian equity market does not fully reflect the size of the economy. But then, any acceleration or declining in the economy is first recognised on the exchange.<\/p>\n
As we enter into the remaining half of the year, we expect a mixed performance that will be driven by government policy and implementation of 2016 budget as fiscal and monetary policy complement each to drive economic growth and development. Further recovery of oil price will fast track infrastructure development.<\/p>\n
Index and Capitalisation Movement<\/p>\n
Are u prepared for\u00a0market correction 2 protect your portfolio and even profit from this correction? If you\u2019re not sure, join me Sept 9, at Blumy Guest House,51\/53 3rd\u00a0<\/span>Avenue, Behind MTN Office, Gwarinpa Estate Abuja, when I\u2019ll share my powerful defensive strategies and demonstrate how you can actually profit from the recovery market and economy.<\/p>\n Plus, I\u2019ll also show you how to:<\/p>\n This event is filling up quickly so and secure your spot and enjoy 20% discount on all our home pack study materials that will boost your understanding and knowledge to profit from stock market investment.<\/p>\n <\/p>\n Registration fee is just N1,000 online. CLICK HERE TO REGISTER<\/a><\/strong><\/em> <\/span>or at the venue.<\/p>\n Hope to see you there,<\/p>\n Ambrose Omordion<\/p>\n Founder & CRO | Investdata Consulting Ltd<\/p>\n<\/div> Despite the seeming associated risk, equity investment has proven to be the best performing investment window, whether in a bullish or bearish market when compared to other investment options like bonds and fixed income instruments in the money market. Typically, stock returns are derived from capital appreciation, dividends and even bonus issues. Dividends payment have historically accounted for 20 to 40 percent of the average annual stock market returns. A lesser known fact is that reinvested dividends have provided for between 44 to 97 percent of historical stock market returns.<\/p>\n During tough market conditions such as the down market that we are now experiencing, investors should realize that counting their losses will not prevent further losses. They should rather change their investment perception and tag along with the market as it presents itself. Investors should take advantage of the opportunity of low priced equities to position in the market in anticipation of full year earnings of quoted companies in the first quarter of 2017, considering the present high dividend yield of stocks.<\/p>\n For now, there is no expectation of corporate results that will influence prices of stock, but with external forces or information that can drive the nation stock market since the liquidity level remains tight and the government has failed to look into the plight of its citizens that have lost fortunes in the market as a result of deteriorating economic situation. The falling prices of equities on the floor of the exchange has pushed dividend yield of many stocks and some sectors up.<\/p>\n But given the uncertainty of corporate earnings amidst the current economic slowdown, the market is probably showing that the dividend cut which has largely been concentrated on the manufacturing sector would spread over to other industries as well. Investors should be careful as the outlook for dividend growth in general in 2017 is slim, since some of the recent released earnings have revealed how many companies would be next year.<\/p>\n However, if you can achieve at least anything above 8% yield to cover the half rise in inflation you would be able to weather any short-term and long-term weakness in the stock market. This does not mean that I am recommending a huge portion of your long-term portfolio in bonds, which are normally sold to retirees as a \u2018safe and reliable source of income.\u2019 You do get a fixed payment every period or so, but the purchasing power of this payment declines over time.<\/p>\n Thus a very good strategy over the long run is to create a diversified portfolio of stocks, that have shown consistency in raising their dividends year after year and which spot an attractive dividend yield for your consideration. Here, it\u2019s necessary for investors to know how the yield is computed whether based on forecast or historical dividend. \u00a0\u00a0Dividend yield is calculated by what have been paid by dividing the latest dividend with the current market price of the company. Higher yield does not guarantee increase in dividend payout.<\/p>\n<\/div> The market has suffered huge losses as it continued its southward trend in the past months and weeks before finding new support level that brought the oscillating trend we saw in the recent weeks. This is an indication that the expected market recovery is underway despite that the companies and market fundamentals that are to influence equity price are still very weak for now but when positive information and improve macroeconomic indices start emanating in the weeks ahead it will support the recovery move.<\/p>\n Increasing unemployment rate, due to high cost funds as a result of high interest rate, high cost of governance, dwindling value of naira as a result of falling oil price, low purchasing power and weak Q3 corporate earnings have affected the market hugely. Also, the government economic blueprint has not given direction yet to guide foreign and local investors decision. The uptrend witnessed in the first trading week of August was attributed to sentiment on low prices of equities as smart money consolidate their positions in some companies. The current high dividend yield and margin of safety should guide discerning investors seeking opportunities to grow their portfolios and build wealth. They should buy quality stocks even as the market decline in the face of expected recovering. Targeting companies with consistent history of dividend payment on quarterly or yearly basis. Research has shown that companies with a policy of consistently increasing dividends have outperformed the market on many occasions. Dividend paying stocks put cash in your pocket and help you to counter inflation.<\/p>\n Unlike earnings, dividends cannot be manipulated or faked; dividends provide continuous feedback on company\u2019s performance. As time passes dividend investors see their income steadily grow. You do not have to wait five to 10 years to determine if the strategy is working.<\/p>\n Reinvested dividends provided a significant portion of the historical equity return; performance in any given year is driven by capital appreciation, but long-term returns are largely the result of reinvested dividends. Good companies grow their investors\u2019 dividends: you expect your employer to give you a raise periodically. Why wouldn\u2019t you expect the same from your investment?<\/p>\n Spending dividends in retirement does not harm your investment. In addition, a good dividend portfolios can be given to your children and grandchildren. A dividend portfolio is relatively cheap to maintain. We strongly advise that dividend paying stocks should have a spot in everyone\u2019s portfolio, especially in a time like this.<\/p>\n Another key factor to successful investment in this kind of market is to invest in companies that are leaders in their business and industry. If the company is key player in its sector then it can raise prices to keep up with inflation but not in every situation. The market leaders can easily raise capital and survive economic downturns considering the nature of their products and services that have no close substitute. These companies are money spinners with healthy cash flows. As an investor you may take a full position in some stocks right now at a better price. There are some good quality stocks around that are immune to market selloff, meaning that after profit taking or free fall of the market, some companies share prices bounce back on the strength of its profitability and earnings.<\/p>\n<\/div> Recently, I went for a meeting with a top executive of the company managing my website. After the meeting, I also used the opportunity to see one of the executives who has been my client for the past 9 years and anytime I used some stock terminologies which he will say \u201cAbeg you don start again talk wetin I fit understand.\u201d<\/p>\n So, I had to explain in simple terms that he could understand and easily relate with. So, in today\u2019s blog, we will be looking at some types of stock, what is a bear and bull market etc.<\/p>\n How Many Types Of Stocks Are There?<\/strong><\/p>\n There are two main types of stocks that investors can own: common stock and preferred stock.<\/p>\n When people talk about stocks they are usually referring to common stocks because, well, they\u2019re common and they are the majority of the stocks issued. Both of these stocks represent ownership in a company but preferred shares normally come with a fixed dividend unlike the common stock, which has variable dividends. People may choose preferred stocks because in the event of liquidation, preferred shareholders are paid off before the common shareholders.<\/p>\n Bull Market<\/strong><\/p>\n In bull market everything in the economy is going well. Stocks are rising, unemployment is low and the economy is growing.<\/p>\n Bear Market<\/strong><\/p>\n A bear market also does not last for a set term as it can go on for years. During this period, investors have a hard time picking profitable stocks.<\/p>\n What Is An \u201cIlliquid Market\u201d?<\/strong><\/p>\n Illiquid defines an asset or security that is not able to sell quickly due to a lack of buyers and sellers in the market. Selling it quickly would result in a loss of profit. A market would be described as illiquid if there is a shortage of interested buyers and little is being traded.<\/p>\n The above were basically the clarification I discussed despite the fact that he has been a longtime investor. Although it may look ordinary to those who already understand but I believe that it will go a long way to help you have a better understanding of stock market reports and analysis<\/p>\n<\/div> Before the crash of the stock market in 2007, I could still remember how I lost 70 million naira worth of stocks. Although, I perceived that most the stocks that were on the rise have no basis, in fact some of them have closed down years ago.<\/p>\n I had the facts, knowledge but it was too good to be true so I had to put all my investment in those stocks which made me lost that kind of amount. Usually, I would sell the stocks then give each investors their money then go home and be watching but non compliance with fact led me into such mess.<\/p>\n As an investor, you\u2019ve likely enjoyed a steadily rising market one time or the other. But what can easily be forgotten amidst a rising market is the perils of a downturn, and how much return it would take to recover losses. The truth is, recovering losses is much more difficult than many investors may realize. It\u2019s important that you take a careful approach when building your portfolio to minimize risk and losses.<\/p>\n Understanding the pit falls of losing money can help mitigate loss aversion, which describes people\u2019s tendency\u00a0to prefer avoiding\u00a0losses\u00a0to acquiring gains.<\/p>\n Let\u2019s take a N100,000 portfolio for example. If that portfolio loses 30% (N30,000), what is the percentage that the remaining N70,000 must earn in order to get back to N100,000? Many think that a 30% gain would be needed to get back to breakeven, but that\u2019s incorrect. Let\u2019s break it down a little bit further. A 30% gain on the remaining N70,000 is only N21,000 and would only bring the portfolio to N91,000. In reality, it would take a 42.9% gain just to recover the 30% that was initially lost. See the below for some more examples:<\/p>\n As demonstrated above, the required return rate for breakeven increases at a much faster rate as the loss increases.<\/p>\n You\u2019ve heard it before: Protect your portfolio by diversifying<\/strong><\/p>\n The inherent difficulty of regaining losses in a downturn is just another reason why diversification of your portfolio is critically important.<\/p>\n A diversified portfolio (one containing multiple investment vehicles) will likely contain a mixture of stocks, bonds and cash. As opposed to having all of your money tied up in one stock or asset class, a diversified portfolio can help offset swings in the market.<\/p>\n Understanding your risk tolerance, or how well you can handle big swings in the market, will allow you to set your financial goals accordingly. Setting realistic financial goals is a key step in developing an investment strategy for your portfolio. If you have a higher risk-tolerance (you can handle big swings in the value of your portfolio), your portfolio would contain more stocks than bonds. An example of a high-risk portfolio would be 80% stocks, 20% bonds. Adversely, an example of a lower risk portfolio would be 40% stocks and 60% bonds. In understanding your risk tolerance and goals, you will have a better understanding of how you are investing your money, and why you are investing in that manner.<\/p>\n Stay informed on market activity<\/strong><\/p>\n After establishing a well-balanced portfolio, it is important that you avoid the \u201cset it and forget it\u201d mentality. Checking on your investments regularly and staying informed about market news will help you know if and when you need to get out of a particular investment. In addition, attend seminars and webinars organized by top experts in the field; you can join my facebook page www.facebook.com\/investdata on a weekly basis for live webinars and also ask any questions regarding stock markets \u00a0In case you find your portfolio deviating from your original investment plan, re-adjusting your investment allocations, or re-balancing, will help keep your portfolio in line with your investment goals.<\/p>\n In conclusion, taking the time to craft a well-thought out plan for building a portfolio can help minimize losses and help you achieve your financial goals. Having a well-balanced portfolio can help reduce losses and make recovery much more manageable.<\/p>\n <\/p>\n<\/div> Just as there are several reasons why some investments make money, there are just as many, if not more, for why an investment loses money. More often than not, there is some investor error lingering in the background of a failed investment. Many investments lose money simply because of investor behavior which is trading based on emotion and not facts. Whether the investor is trading too often or not often enough which could affect the portfolio.<\/p>\n However, when an investment loses money despite otherwise sound investing behavior on the part of the investor, reasons for the loss might go back to the company itself or unethical business practices.<\/p>\n Definitely, there are no bullet-proof investments or investment strategies, but there are patterns that can save you from significant loss. In the end, good investments that make money aren’t always the most exciting (in fact, they generally aren’t exciting at all), but the key is to find the balance between the risk and reward and not make those common investing mistakes which is by seeking knowledge by attending seminars, subscribing to monthly nugget on stock investment. Many people have made mistakes so it is better you learn from them<\/p>\n <\/p>\n<\/div> Market Update for the week ended July 1<\/p>\n NSE Opens Q3 Red, Amidst Negative Macroeconomic indices and Earnings season <\/strong><\/p>\n The Nigeria equities market opened trading activities for the third quarter under pressure, closing in red as investors went on a flight to safety while trying to reduce risk amidst growing political concerns in Nigeria and around the globe. The week recorded a four-day decline that saw the composite NSE All-Share Indexshedding 4.39%, as profit taking and effects of the Brexit vote a fortnight ago continued.<\/p>\n Ahead of last Friday’s trading on the floor of the exchange, the NSEASI and market capitalisation were up about 3.34% and N314 billion respectively, for the first half of the year. This was attributed to market rebound in May and June as a result of the budget approval by the National Assembly and its signing into law by President Muhammadu Buhari after weeks of disagreements between the federal legislators and Presidency. Also, the new market-driven inter-bank foreign exchange policy that boosted investor confidence to wipe a four-month loss that turned many portfolios positive and into profit.<\/p>\n Market performance for the period under review after a prolonged downtrend wasmild as the nation\u2019s stock market indices closed at 29,597.79 and market capitalisation at N10.17 trillion respectively, after touching a low of 22,330.96 and N7.72 trillion within the time under consideration. It however recorded improvement in market development and growth as technology transformed the face of the market to promote transparency that boosted both domestic and foreign investors\u2019 confidence. It also made\u00a0 trading and investing simple as more online platforms were opened with \u00a0investors now able to place trades from the comfort of their homes and offices, coupled with access to real market information that quicken\u00a0 investment decision as more operators create\u00a0 online portals for clients to trade directly on their own.<\/p>\n Recall that within this period, macroeconomic indicators were inconsistent and negative to reflect the impact of global economic transition and monetary policies to reform the financial institutions after the crash of crude oil prices in international market. This has heightened exposure of many banks and financial markets in general. This triggered struggling in many economies of today which our nation is suffering from at the moment, coupled with nuclear fiscal and monetary policiesof the government. The slowdown in the system have reflected in the key indicators such as the Gross Domestic Product (GDP) that is currently\u00a0 in negative territories, inflation rate above 15% as at May and is likely to move higher when June statistics is released. Others are:high interest rate, high unemployment rate and \u00a0low exports, regardless of\u00a0 capital market indicators \u00a0moved to \u00a0positive direction. Nigerians are more dependent on imports, and while internal debt burden grew, so did the nation\u2019s investment in infrastructure. Oil prices were volatile and remained largely unfavourable, but stayingabove the 2016 Federal Government budgeted benchmark of $38 per barrel, after it had recovered 26% in the second quarter to record the biggest gain since 2009. If the current recovery of \u00a0oil price is sustained, the economy will likely rebound despite the slowdown being witnessed as the \u00a0government implements 2016 budget and provide palliatives to stimulate and drive the change concept to jump start the economy, create new investment opportunity that will influence the stock market and the economy positively.<\/p>\n The stock market in many economies provide the barometer by which the economy is gauged, the Nigerian equity market does not fully reflect the size of the economy. But then, any acceleration or declining in the economy is first recognised on the exchange.<\/p>\n As we enter into the remaining half of the year, we expect a mixed performance that will be driven by government policy and implementation of 2016 budget as fiscal and monetary policy complement each to drive economic growth and development. Further recovery of oil price will fast track infrastructure development.<\/p>\n Index and Capitalisation Movement<\/p>\n\n
<\/a><\/div>Performances Support Dividend<\/a><\/h2>
<\/div>Importance of Dividend, Products and Company Size In Equity Investing.<\/a><\/h2>
<\/a><\/div>Stock Terminologies<\/a><\/h2>
<\/a><\/div>Diversify Your Portfolio To Safeguard Against A Market Downturn<\/a><\/h2>
In today\u2019s blog we will be looking at Diversify Your Portfolio To Safeguard Against A Market Downturn<\/h3>\n
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<\/a><\/div>4 Ways Of Losing Money In The Stock Market<\/a><\/h2>
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<\/a><\/div>Stock Update<\/a><\/h2>
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