Treasury Bills In Nigeria - Investment (2020) - Nairaland
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Fixed Deposits Or Treasury Bills, Which Is Better? / Fixed Deposit And Treasury Bill Investments From Abroad / I Need Information On Treasury Bills In Nigeria (2) (3) (4)
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| Re: Treasury Bills In Nigeria by jedisco(m): 6:35pm On Oct 30, 2021 |
On the recent viral publication by The Economist, as one of the bright spots, it was mentioned that Nigeria hosts 3 fintech firms valued at over 1 billion usd... Looking into this, its true.On the other hand, just 3 traditional Nigerian banks match that valuation. On this thread, there's the general belief that fintech=scam.... This seems to be a cultural issue. Look no more than SARS arresting anyone with an iPhone as evidence. In a hostile economy like Nigeria, building a company that crosses borders and is valued at over $1b is hard work... One begins to wonder if our banks are generally undervalued or if investors shy away by thinking they'd struggle to maintain profitability in the long-term. I struggle to think of any company outside fintech (aside those backed by moguls like dangote) that has started recently from scratch and come close to such valuation... To summarize, though it might seem easier to perpetuate scam online, in Nigeria, vast majority of scams are not via the internet. So no need equating a budding sector with fraud. 2 Likes 1 Share |
| Re: Treasury Bills In Nigeria by jedisco(m): 6:50pm On Oct 30, 2021 |
Another area fintechs could save the day is in the NSE. The stock exchange has largely underperformed and 14 years after has failed to beat its all share index high it reached as far back as 2008. Coincidentally, that was the last time young Nigerians were interested in the market. I've looked around, and I don't know any Nigerian under 30 who is invested in the NSE... I can extend that age to 40 and would still struggle to name folks..and I know a number of financially sensible folks... Nothing guarantees the death of a product/market as one that cannot attract younger folks or new money. A while back, someone wondered why it was easier and more straightforward to buy US stocks from Nigeria than buy Nigerian stocks... If the NSE is going to attract new and young money and boost it's thin books, then that'd definitely come by leveraging fintech.... Just a thought. 13 Likes |
| Re: Treasury Bills In Nigeria by Nobody: 7:01pm On Oct 30, 2021 |
jedisco: You have a point. Only high volatility in NGX will attract young people. You can't expect them to invest when stock prices remain flat or sideways for a long time. |
| Re: Treasury Bills In Nigeria by Hamachi(f): 9:21pm On Oct 30, 2021 |
jedisco:Most young Nigerians are not ready to invest in anything NGX, the returns are very poor, thebojes under 40 and 30 prefer crypto |
| Re: Treasury Bills In Nigeria by Javaside: 9:37pm On Oct 30, 2021 |
emmanuelewumi: Oga Emma, please advise on what we should be buying. dollar ? |
| Re: Treasury Bills In Nigeria by emmanuelewumi(m): 9:44pm On Oct 30, 2021 |
Javaside: Invest in a personal business, get a steady cash flow from this business or profession and use the proceeds to become a shareholder in a companies with good cash, high profit margin that have been growing theirs earnings for the past 5 years, 5 Likes 2 Shares |
| Re: Treasury Bills In Nigeria by jedisco(m): 10:51pm On Oct 30, 2021 |
petaling: Young people may be tilted more towards more volatile stocks but a good number still still balance their portfolio well. Penny stocks that usually provide huge volatility (to those who want it) can't do that easily on the NSE as the liquidity is very low...... I agree the decline of the market hasn't helped... Even if slow, once a market is moving upward with strong fundamentals, new money will find it's way in.... The best insurance a market can give is by rewarding folks who held through the bad times and bouncing back stronger... If folks who dumped the NSE after the 2008 bubble are not regretful after 14yrs, then new entrants would stray close. 1 Like |
| Re: Treasury Bills In Nigeria by jedisco(m): 11:06pm On Oct 30, 2021 |
Hamachi: Truly that's the case now.... But there was a time when young folks rushed in with their little naira, hoping to be the new Warren Buffet in old age.... Most were burnt irreparably and haven't returned eversince.... I remember making enquiries on buying stocks in 2007 wanting to use a good sum I was gifted... Thankfully, I didn't. A strong market should protect its participants by trending higher. The second issue is onboarding... Why should it be easier for a Nigerian to buy foreign stocks than local ones.... Before the CBN ban, one of the local fintechs started offering folks the opportunity to buy crypt0 in-app at the click of a finger... Why can't the NGX partner with our fintechs to spotlight local stocks? The onboarding process is just ridiculous.. On Crypt0, it had it's first boom in 2017, but before that the young had largely stayed away from the NSE since 2008. Today, crypt0 has attracted young Nigerians largely due to its easy onboarding process, returns, volatility and a strong market fundamental. Moreso, with the crypt0 space heading in the direction of earning yields on assets held, it'd be more difficult to convince a young Nigerian already in the crypt0 market to invest in local stock with the potential risk of devaluation while on the other hand, he can hold a usd stable coin and earn yields of upto 20%. 4 Likes |
| Re: Treasury Bills In Nigeria by pafra(m): 4:50am On Oct 31, 2021 |
jedisco: Nigerian stocks are useless In 2008 or there about, I took out 1M to buy stocks then with lead capital. I bought two stocks unity bank shares 100,000 units @ N8 and GoldLink insurance with the remaining balance. My register gave me over drafts which I didn't request for. They started deducting interest from the overdraft . Without information Fast forward to 2021. The two stocks are less than N8000 . I just applied for e dividend. The Guy in the register told me he can't remember any dividend from the two stocks.. After share reconstruction unity bank share is now 9240 unit @ 0.57 While GoldLink insurance 25000 @ 0,20 For ten years. Imagine I invested then on the worse crypto currency After so many paper work , emails and calls they are yet to pay e dividend. One register Data max insists I must sign the signature I use to buy guarantee bank share about 18 year ago It is one month since I first apply I have sent reminders The register will tell that they forward your request. Last week I received N1000 from transcorp. They are just frustrating and annoying. Just run from Nigerian stocks 14 Likes 1 Share |
| Re: Treasury Bills In Nigeria by emmanuelewumi(m): 4:58am On Oct 31, 2021 |
pafra: Unity Bank has a negative shareholder fund of over N200 billion, Goldlink Insurance is a fringe player in the sector. I guess you love penny stocks, any business that doesn't have fundamentals will always obey the law of gravity by coming down. Dividends from the stock market pays a substantial amount of my own bills. Look at the free cash flow of a business before you invest, the dividend and earning yield, consider the earnings growth, consider the industry, look at their debt to equity ratio, the quality of the management and board is also important. Then the margin of safety, meaning the business is selling at a discount after using the relevant valuation tools. When all these are in place, you are good to go. Buying a wonderful business at a wonderful price 9 Likes 1 Share |
| Re: Treasury Bills In Nigeria by kalu61(m): 6:14am On Oct 31, 2021 |
pafra:From 1m <9000 in 18 years. Oh mehn. Real Estate would have performed better. Kpele 2 Likes |
| Re: Treasury Bills In Nigeria by emmanuelewumi(m): 6:25am On Oct 31, 2021 |
kalu61: History will always repeat itself, buying anything that doesn't have fundamentals and predictable cash flow that is consistent is risky A highly conservative Fixed income Investment at 12% would have also grown to about N4.5 million. People lost money during the dotcom era in the American stock market, people will still lose money in the future. For every successful Amazon, Apple, Microsoft etc, there were thousands that could not make and investors lost money. One of the risk of Investing based on the expected growth that is not supported by figures, profitability and cash flow 5 Likes 2 Shares |
| Re: Treasury Bills In Nigeria by pafra(m): 6:34am On Oct 31, 2021 |
kalu61: Each time I thought about this. I feel like weeping |
| Re: Treasury Bills In Nigeria by kalu61(m): 6:41am On Oct 31, 2021 |
emmanuelewumi:You are quite correct sir. I have learnt a lot here. About 70% of people will continue to loose wealth because about 70% of businesses will under perform and about 70% invest in business they don't understand. About 70% invest in highly volatile environment to hit the jackpot but only <1% are lucky. Life goes on. He should count his losses and move on. "Invest in what you understand" 5 Likes 1 Share |
| Re: Treasury Bills In Nigeria by emmanuelewumi(m): 6:41am On Oct 31, 2021 |
pafra: If I may ask, how many stocks did you have then? What was the value of your portfolio? What percentage of the portfolio was allocated to Unity Bank and Goldlink Insurance? |
| Re: Treasury Bills In Nigeria by emmanuelewumi(m): 6:44am On Oct 31, 2021 |
kalu61: About 90% of people will lose wealth. Sustainable wealth is a marathon and not a Sprint. That is the case with 95% of people who built last wealth 3 Likes |
| Re: Treasury Bills In Nigeria by ibechris(m): 6:45am On Oct 31, 2021 |
pafra: |
| Re: Treasury Bills In Nigeria by kalu61(m): 6:50am On Oct 31, 2021 |
pafra:If l tell what's going on in my head ehh. 1m 18 years ago was about $133/Naira. Converting to USD is one. Buying Coka cola shares or any top US stocks Real Estate(my safe heavens) Well, l believe the amount of information you have now aren't the same with what was obtainable then. You have grown and have learnt a lot along the line. That's the fee you pay for life experience. Forgive yourself and move on. 1 Like |
| Re: Treasury Bills In Nigeria by kalu61(m): 6:58am On Oct 31, 2021 |
emmanuelewumi:I concur. Wealth is a marathon race; slow and steady. However, I think why 90% lose wealth depends inevitable variables. One of your children may come up tomorrow and make a blunder and everything will just go down the drains  . God forbid sha |
| Re: Treasury Bills In Nigeria by Born2conquer: 7:10am On Oct 31, 2021 |
Hamachi:Woo I invest in anything in Nigeria, so the government can Wake up one day and freeze my stocks? So the broker can also play God on me? So the elites can manipulate my stocks easily? The fact remains that there’s no security of investment in Nigeria. I have had several cases where my accounts got frozen just because someone made a single report and my banks (which I’ve been with for years) didn’t make a single effort to confirm from me! They froze everything and I had to spend over 300k on legal fee to prove my innocence. Is this the way the bank want to encourage young people to use the BANK? I can proudly tell you that by 2030, banks will mostly be used as a medium of exchange and not as a place to save money. Young people no longer trust the bank. Who should i talk about days of wrong deductions with poor customer service? Should I talk about days when I got back to the country and I discovered that my bank already restricted my account just because I sent 7M out?? Na God no make me sleep for airport that day 2 Likes |
| Re: Treasury Bills In Nigeria by emmanuelewumi(m): 7:12am On Oct 31, 2021 |
kalu61: You set up a trust account to avoid that. People lose money because they don't know the difference between value and price. They invest in what they don't understand. They invest in the latest fad. They take reckless risks. (poor risk management strategy) They don't take risks (referring to calculated and informed risked, with knowledge on how to navigate the terrain. The invest in assets or ventures that do not have cash flow or will have predictable cash flow in the future but expect to consistently make money from the capital appreciation of the venture or assets They are not diversified They believed the go times will be forever. They think they are smart and this time is different, the financial mistakes of the past thet wrecked people can't happen this time around . Reason why I respect Warren Buffet, he has been on the Forbe list for about 3 decades. Billionaires have come and left the list, some were rated higher than him but fizzled out after few years. I respect him for his consistency and wisdom 8 Likes 1 Share |
| Re: Treasury Bills In Nigeria by Born2conquer: 7:14am On Oct 31, 2021 |
pafra:Now imagine this! Nigeria banks/financial institutions are always nicer and accommodating when they want to get money from you. But to get your money back from them would be a tug of war. The goal to me is to boycott anything bank! They’re useless and frustrating. God! 1 Like |
| Re: Treasury Bills In Nigeria by Hamachi(f): 7:31am On Oct 31, 2021 |
Good morning M.y.c.r.y.p.t.o.n.g is a community for c.r.y.p.t.o enthusiast on telegram 1 Like |
| Re: Treasury Bills In Nigeria by pafra(m): 8:01am On Oct 31, 2021 |
kalu61: Fee I paid was costly. 2 Likes |
| Re: Treasury Bills In Nigeria by jedisco(m): 9:05am On Oct 31, 2021 |
pafra: Your post is a sad one and too many people who bought then have such stories....but 1mil to 8000 leaves me scratching my head... Holding the stocks this long means that you went in for the long term. Folks would blame you for not doing this or that forgetting that you were largely a victim of a weak market. People would quote Warren Buffet forgetting that while his principles are sound, they're built on a fundamentally strong market. The US stock market has been in an uptrend for decades. It has about one major dip every decade and bounces back stronger.... In such a market, if you apply the right principles and search out the blue chips, you're made. On the NSE, the opposite is the case.... The few rich manipulate the market as they see fit with no repercussions whatsoever. If I put same effort I'd use to find a bluechip on the NSE into a strong market, my returns would be many times better. The sad fact is that if you had simply held the dollar in 2008 till now, you'd have outperformed 99% of people who invested in the NSE. Crypt0 is quite different, it's largely changed the game... 'If to say' doesn't help in investing, but if that 1 million was put in bitc0in in the early days and held, you'd be earning tens of millions in yearly interest by just lending out your Bitc0in. The onboarding process is straightforward. With the onset of tokenised stocks or commodities, one can buy crypt0 versions of stocks or metals that are pegged to the underlying asset. Even if one doesn't want any volatility, they can just buy a usd coin and earn interest on it... Of course, the crypto asset market can still be manipulated just like any other but it's very much an open one... It's no wonder why Nigeria has the highest rate of crypt0 adoption... Sadly such monies moving out affect the local markets. I'd say that if half of the money Nigerians had in crypt0 was channeled into the NSE, each stock would trade for at least 25% higher 4 Likes |
| Re: Treasury Bills In Nigeria by jedisco(m): 9:08am On Oct 31, 2021 |
Hamachi: Rather than spamming multiple threads with this, why not put up a nairaland add... If there's good content on the telegram page, it'd grow without this |
| Re: Treasury Bills In Nigeria by jedisco(m): 9:22am On Oct 31, 2021 |
Still on the NSE, I still don't understand why it's much easier and cheaper to trade foreign stocks from Nigeria than our local ones. It's like saying it's easier for a Nigerian living in Nigeria to open a US bank account than a local one. It's not magic, the market would remain dry until some of these fundamentals are changed. The world financial market is becoming more global and folks are increasingly getting involved in different markets from different parts... So why lock oneself out? Tomorrow, they'd complain how youths are not invested on the NSE and I wonder if folks at NGX are dumb or what.... Recently, Kuda Bank raised a $500 m funding and that catapulted it to between number 5-7 of top Nigerian banks by market cap. That means one or two micro international consortiums can easily buy up significant stakes in any bank of their choosing. That left me wondering... Why are Nigerian banks that cheap? Looking at their quoted rates and associated liabilities and running costs, most are practically worthless... Fact is it all starts out with the market being manipulated to the benefit of a few. With time, everyday folks leave the market too draining the much needed liquidity and everything tanks... 1 Like |
| Re: Treasury Bills In Nigeria by handsomebolanle: 9:57am On Oct 31, 2021 |
The manipulation in NSE. Results leaks before official publication. And many more with no one held responsible. These things will soon be normalised. What a country!!! These are not healthy for NSE 2 Likes |
| Re: Treasury Bills In Nigeria by emmanuelewumi(m): 10:39am On Oct 31, 2021 |
jedisco: Market capitalisation is nothing, the bank with the highest market capitalisation might not be the highest in terms of profitability, best in terms of efficiency, the best in terms of return on equity, return on asset and growth rate. The most important things to look at at the intrinsic value of the business, the enterprise value of the business. If anybody wants to get a 5% equity in any of the big banks in Nigeria there is no way their market capitalisation will not increase by a minimum of 80%. Zenith Bank at N25, Jim Ovia will not sell his over 2.5 billion units for N70 billion Lai Lai doubt if he would sell for N100 billion which is about N40 per share. The annual dividend of over N7 billion is okay for him. According to market capitalisation, Zenith Bank is about N800 billion. But the share holders fund alone is over N1 Trillion, deposits is over N4 Trillion and profit after tax is over N200 biillion. When the market is low, you can value my property as N100 million. If the property owner is getting an annual rental income of N20 million from the property he is less concerned about whatever valuation ascribed to his Investment property. When investors know the difference between price and value and understand the valuation of an asset, Investment, Busineses, venture they will be able to make profit through their knowledge of the market dynamics, behavioural finance and Investment psychology 17 Likes |
| Re: Treasury Bills In Nigeria by emmanuelewumi(m): 11:24am On Oct 31, 2021 |
People also need to know the difference between a business and its stock price. Good stock price: it is undervalued and selling at a cheap price. Bad stock price: it is overvalued and selling at a huge premium. It is appropriately price if it is selling within the range of its intrinsic value. Good business has good fundamentals, the figures are good, wealth is created, earnings are growing,it is profitable, debts are manageable, return on equity etc is okay. A bad business is the opposite of a good company. According to legendary Peter Lynch behind every stock their is a business, find out how the business is doing. A good business can be a bad stock and a bad business can be a good stock, a good business can also be a good stock and a bad business can be a bad stock. Always better to focus on good Busineses that are good stocks or in special situation eg recovery or turnaround situations one can also consider a bad business which can become a good stock because of the special situation and for the fact that the business is now selling below its liquidation price 3 Likes 1 Share |
| Re: Treasury Bills In Nigeria by kalu61(m): 11:42am On Oct 31, 2021 |
emmanuelewumi:These are the inevitable variables coupled with market uncertainty that's makes us take a decision that at the end one seen as a fool and the other genius. I still go with th Buffet philosophy, Good business, good stock and don't worry about the % return as long you are sure they will definitely be % returns no matter how small. Just be sure it will return. Buying a bad stock hoping it will turn around, buying a good stock and things turn around. That's the nature of investment. Good input boss. You wealth of experience in much appreciated in this thread. 1 Like 1 Share |
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