The Stock Business

[gogannaka]

The Stock Business.

The stock business is one lucrative source of livelihood.A business with a lot of security too.
Unfortunately not many people engage themselves in this business.The misunderstanding that
the business requires huge sums to be invested is the main deterrent to our people investing
in stocks.This however is a misunderstanding only as with as low as N10000, one can invest
in the Nigeria stock market and get fruitful gains.Another deterrent is the ignorance on our
part to enquire about this form of investment from experienced business persons or
stockbrokers.
I am not a stockbroker and neither am i a stock millionaire but i know that this is one
lucrative area to invest in.I'd give you instances and examples of people i know that made a
fortune in less than 2 weeks.For example, if you happen to get across a financial newspaper
dating back to December 2006, check the NAHCO share price under the aviation sector.Its
price was between N5 and N6.Check it out April 07.It reached a high of N54.Calculate the %
increase.Lets say you bought 5000 units in December at N6 i.e N30000 worth of NAHCO
shares.In April the share price increased to N54 and you sell hal of what you bought i.e
2500 units at the N54 price.It implies you get N135,000  :o.Ina ga kamar ka mayar da kudin ka
ko?Idan kana/kina so ma you can sell the whole 5000 units i.e you make N270,000 :o :o.(the
stockbroker will get 3.5%)That is how the thing goes.
I know of someone(perhaps a konliner) that bought 400 units of ashaka cement shares at
N24,now ashaka sells for N84.Calculate how much he'll make if he sells the 400 units. That
is more than 200% gain.
Take another recent one- the dangote sugar refinery.The initial public offer (IPO) was @
N18/share.To the greatest surprise and anticipation dangote now sells for N45
(it reached a high of N60).I thank god i bought this one.

Some people say the business is a game of chance or a gamble.Yes and no.It is a business
that is greatly influenced by the news.To succeed you have to be up to date with the
financial and stock reports in the country.Get to grips with the latest financial
newspapers.Thank god for the internet too.
An example of how the news affects the market is when recently the papers reported that an
investor(maybe from guiness) has invested a lot of money into Jos breweries,before you knew
it the JIB share which used to dangle between N1 and N2 suddenly rose to around N9,that is
more than 300%.Amma fa babu kyau sayen shayar gidan giya.HARAMUN NE.BA RUWANA.MISALI NE
KAWAI.

What you need to know when entering the stock business:

1.You need to know which kind of investment you are taking up.Is it long term investment or
short term(quick money).This helps in the kind of shares you buy.(Blue chip or penny stock)

2.You need to a stockbroker.(They buy or sell the shares for you)

3.You need to open a CSCS account with the central securities clearing house.(it's free)

4.you need the money.

5.You need the heart and will.

6.You should also know that the stock brokers charge a fixed amount of 4% per each

transaction.This rate is fixed by the NSE

* The CSCS account is your stock account and each quarter a free statement is issued to
you(through your stock broker) showing you the shares you have.It can serve as a collateral
for obtaining loans.You should try as much as possible to deposit all your share
certificates into this account.

* You should at all cost maintain one signature.

* Whenever you want to buy or sell a share on the floor you need to append your consent and
signature on a demand form with the stock broker.

* You might want to open a current account in any bank for easy lodgement of cheques and
dividend warrants.

If you need any more information and advise feel free.I promise to answer to the best of my
ability.You can PM or mail me if u don't want it disclosed.

[gogannaka]

Investors can now monitor their stock account themselves on the internet or opt for the SMS option via trade alert. Find below three simple steps need to gain access to your stock position online:

1. Open an individual or corporate stockbroking account with a listed stockbroking firm and obtain your CSCS Clearing House Number (CHN).

2. Register as a new user on CSCS website using your CHN.

< http://www.cscsnigeria.com/modules.php?name=Your_Account&op=new_user>

3. Fill out CSCS Online Access form and submit to CSCS through your stockbroking firm.

[neozizo]

hello gogannaka,
im happy u started this thread,though it seems it has gone stale
pity

i started investing in the nigerian stock exchange mid-last year and i am happy to say i have made more gains than losses (like u i havnt hit the millionares club yet)
but lately the market seem to be not too much of fast money making medium
do you think there are better days ahead?

i learnt the SEC set out some new rules which are meant to make the market safer and more predictable....
it seems this has just taken the zest out of it....

are u still in the market? how are u fareing?

[Dan-Borno]

gaskiya i am happy to see this thread and hope
that my friend will keep it flaming.

i also registered with CASHCRAFT, i heard that
they are good stockbrokers, but i am experiencing
problem opening my CSCS account online.

gaskiya its one of these safest business to deal in,
especially when you dont have a still business to
pursue.

[ummita]

Yeah, stock investments are very good. You forget about investments only after few years to hear gud news. I made a couple of stock investments in 3 different companies. Its only peanuts jare! Nothing like Billions! I raised n sold some stocks months back from one of the companies.........very, very gud proceeds of sale. ;D  But the last company, which is a very well known bank is quite dissapointing. >:( Merging with an International Bank to speed up their stock sales or wateva it is dey said, just resulted in many losses for investors. Imagine selling a stock for a 25% loss and not finding any stock that goes up by 44%. No profit at all!!! Worse is, their insurance policy is a risk on its own!!!!!!! So investors are without any sort of protection. Absolute rubbish!!!!!!!!!

I for mention the bank name, defame their status smo!!!! But anyway  :-X

[ummita]

investor(maybe from guiness) has invested a lot of money into Jos breweries,before you knew
it the JIB share which used to dangle between N1 and N2 suddenly rose to around N9,that is
more than 300%.Amma fa babu kyau sayen shayar gidan giya.HARAMUN NE.BA RUWANA.MISALI NE
KAWAI.

You sure, you didnt make any stock investment in such sectors? Daddy ka tabbatah? >:( *stern look* Whispering to Gogannaka, kuyi hankali da mutumin nan!

[neozizo]

Ummita, a couple in 3? ???LOL.

Me no expert but it seems to me ur investment method is what they call bandwagon method.

Advice: its better to invest based on fundamentals or thechnicals

....But its best if you have a crystal ball.

Yeah its a pity the stocks that tend to do well are the haram stocks

[ummita]

Mallam Neozizo, kah ganni koh, let me put it this way when I said a couple........as explained by the corporate body I made my investments with....they gave reasons that due to share consolidations they give new share allocations, which are meant 2 xsist on their own..........so this was wat I meant by a couple in one.......ka ganeh? :-\

Yeah u myt b ryt about the band wagon thing but I think its because majority of the companies have no insurance policies to no policies at all to offer investors sufficient protection. Like I said earlier, the first company gave me pregnable dividends and the organisation is indeed in a hot growth sector incase u planning 2 invest ur billions there. The other one, which was a total flop and got me biting my fingers hard was because I didnt bypass those wicked brokers and their hefty commissions (hiss). Maybe if I had bought directly from the company I could have saved a little. Had I known! >:( >:( Anyway, its like 8months gone, so na huce.

Frankly speaking Neozizo, I wasnt into this stock thing neither was I an expert. It all started with a gift from my old man and the last two is the LITTLE PEANUT earning one gets, which I decided to play down on stock investments. Atleast it gives u dat little sense of ownership in a company ;D (rolls eyes) who am I kidding! Also because this stock businesses are just making fast waves now and almost every1 is investing like u said, its the "cromo effect" abi? Anyway, recently, I have been piping my evil eyes on another company that seems to be duin gud and if I shud believe in the bandwagon fallacy........if many find it acceptable, it is acceptable! So keep your fingers crescent for me. ;D

Yeah, only the stocks that people like us wouldnt invest in seems be on a good roll. For instance, Gogannaka's brewery scenario up there. But mhmmmm akan abun dunya mutum yer kai kanshi lahira. Best 2 manage with the managed abi?

[gogannaka]

WOW ashe we got some real investors.
Oya make all of una surrender your zakats.

DB i believe you can only open a CSCS account with a stockbroker,you can't open it online by yourself because you are not authorised to trade shares by yourself.Only stockbrokers can do that.
Cashcraft i hear are good stockbrokers,infact getting a bad stockbroker(excluding the lagos ones) is hard.The SEC,NSE and CSCS are doing good in monitoring the activities of the brokers.

Zizo,the market is undergoing serious restructuring. Ka ga yadda bank shares ke dropping kuwa?
Omo if i were to invest in banks now i go shine my eyes well well,i go advise make pessin wait make the storm clear 1st.
The SEC is putting some regulations that would end the manipulation of prices by some speculators,brokers and company boards. I think its the case of AP,Cadbury, NAHCO and Big treat that made the SEC take such actions. People made a fortune out of these companies in a few days. I wish i was among  >:(

Ummita Ummita so all the roko u dey do during sallah periods na share u dey buy?Oya bring my share. I know access bank after the consolidation of the banking sector did some magic to their shareholders and they ended up losing shares. Shareholders were pissed.

The level of awareness in the stock market in the north is encouraging. I am advocating that all registrars should open up offices across the country just as the banks were directed; that way if DB wants to transfer his shares he doesn't need to travel all the way to lagos,he might as well do it in maiduguri. One great problem we are facing is the rejection of signatures by the registrars in lagos. They can ask you to come by yourself just because of a N5000 share certificate.This isn't economical. Some even reject bankers confirmation.

[gogannaka]

SEC launches e-dividend, plans dematerialisation of other activities
By Gbenga Agbana,Guardian newspaper

FOR investors in the capital market, the era of delay in dividend payment has become history following the formal launching of e-dividend yesterday in Lagos by the Securities and Exchange Commission (SEC).

With the launching, dividends which is the return on investment by quoted companies to individual and corporate investors would henceforth be paid directly into the bank accounts of beneficiaries.

E-dividend refers to the payment of dividend due to a shareholder through a direct credit into his/her nominated bank account rather than issuance of cheque or warrant. It is a convenient and secure on-line means of paying dividends.

Already, as a way of alleviating the sufferings of investors further in the capital market, the Securities and Exchange Commission (SEC), yesterday stated its resolve to dematerialise every activity in the capital market.

Specifically, the commission, which spoke through Mr Daisy Ekiney, who represented the Director-General, Mr. Musa Al-Faki, said: "We are dematerialising everything in the capital market by introducing e-allotment for offerings, e-IPO, e-bonus among others. Except if people specifically ask for share certificate, it would no longer be issued."

Already, the enforcement of e-dividend formally launched in Abuja last February is being implemented with Oando Plc and Nigeria Breweries Plc as guinea pigs.

Speaking in his address of welcome yesterday, Al-Faki said the Lagos launch was done because of the state's stature as the commercial nerve centre of Nigeria and the capital market in particular.

Listing the benefits of the newly launched product, Al-Faki said it will minimize cases of unclaimed dividend, eliminate dividend loss in transit the forfeiture of dividends in the future, and enhance the ability of shareholders to immediately access and utilize the proceeds of their investments.

To ensure its success, Al-Faki explained that the commission has issued formal letters to the respective stakeholders to meet their implementation modalities.

In his address, the Governor of Lagos State, Mr. Babatunde Fashola, who was represented by the Special Adviser on Budget and Planning, Mrs. Dupe Oguntuase, commended the initiative, noting that it will bring a lot of relief to investors who have told many tales of woes in the past about missing or unclaimed dividend warrants and in some cases their delayed posting.

[neozizo]

Anyway, recently, I have been piping my evil eyes on another company that seems to be duin gud and if I shud believe in the bandwagon fallacy........if many find it acceptable, it is acceptable! So keep your fingers crescent for me.

Do Share!! ;D ;D

Oya make all of una surrender your zakats.

I been wan ask bout this issue..
to qualify as zakat the asset has to spend up to 1 year in your possesion, technically speaking, shares arnt in our possesin.......so how do we go bout this issue?

Also gogganka, can the e dividends be sent to a savings account?

The SEC is putting some regulations that would end the manipulation of prices by some speculators,brokers and company boards.

i think these measures are doing more harm than good, i mean look at how last week the athorities had to artificialy all losses in the market in order to stop the dismal free fall of market.
then they turned around to say it was due to a malfunction of there computers..

[gogannaka]

I also need to be briefed about the zakat issue.

[neozizo]

They launched e-allotement last week,
rechristened margin accounts to custody accounts (and reversed the alleged ban),
N1B recapitalisation of stock broking firms has been put-off also,
We hope the market responds favourably.

[neozizo]

I was able to get this from IslamQA.com
i hope it helps though i still have some issues which havnt been addressed
Praise be to Allaah.

Firstly: 

Zakaah on investments varies according to the intention of the owner.

If he invested in the company with the aim of benefiting from the annual profit on the shares, and not with the intention of dealing in them, then no zakaah is due on the shares themselves, rather he must pay zakaah on the yield, at a rate of one quarter of one tenth after one full hijri year has passed since he took possession of the yield. 

But if the shareholder bought the shares with the intention of dealing in them, then the zakaah is the same as zakaah on trade goods. When the hijri year has passed since the shares came into his possession, he must pay zakaah on their market value, at a rate of 2.5% of that value and of the profit if the shares have made any profit.

End quote from Majallat Majma' al-Fiqh al-Islami (1/879).

Secondly:

If you bought shares with the aim of making profit only, and you paid 2.5% of the profits with the intention of paying zakaah, and you gave it to an organization to distribute it on your behalf, that is sufficient, but you should make sure that this organization has paid the zakaah. If you had taken the money and distributed your zakaah yourself, that would have been better.

But if you bought shares with the intention of trading in them, then you must work out their value at the end of the year and pay zakaah on it at a rate of 2.5% of their value.

And Allaah knows best.