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You Need to be Elon Cool and Buffet Savvy to Grow Your Wealth: deVere CEO

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Elon Musk's SpaceX Raised $850 million at $74 billion valuation

Elon Musk has democratised the stock market but to seriously grow your wealth you need both Elon’s cool and Warren Buffet’s old-school savvy, warns the CEO of one of the world’s largest independent financial advisory and fintech organisations.

The warning from Nigel Green, the deVere Group CEO and founder, comes as the surge in day-trading frenzies, triggered by so-called ‘activist investors’ on social media platforms and online forums like Reddit urging others to invest their cash into unloved stocks, appears to be fizzling out.

Many of these so-called ‘meme stocks’ jumped exorbitantly on the back of these small-scale investments. However, platforms that facilitated this are reporting a flatlining of the ‘movement.’

Mr Green says: “The first quarter of 2021 was a crazy ride in stock markets, and this was driven by online investment communities who adore the likes of the billionaire electric vehicle and space travel entrepreneur Elon Musk, amongst others.

“He’s successfully pitched himself as being both a future first, counterculture activist and part of the establishment. Small-scale day-traders can’t get enough of it and hang off his every word.

“In many respects, this is a good thing. His immense global influence has brought into focus the huge benefits of investing to millions, many of whom would have ordinarily baulked at the idea of putting their money into the hands of Wall Street traders.

“In this way, Elon has helped democratise the stock market.”

He continues: “I believe whilst the mass hype and hysteria might be fading, this phenomenon of retail investors acting as a collective and led by social media and celebrity investors, is here to stay.

“Moving forward, they are likely to be as influential as major hedge funds in moving markets.”

Mr Green goes on to say: “However, as we’re now seeing, many of these small-scale investors – typically inexperienced, younger people who might not necessarily have the financial resources to be resilient against usually highly speculative and volatile investments – are playing a potentially hugely costly game.

“I would urge them to adopt the cool of Elon Musk and the savvy of Warren Buffet.

“Elon can spot future trends like very few others, focuses on sustainability, has utter conviction, takes risks, and is a master at harnessing the power of social media for business.

“Meanwhile, Warren’s focus is on time-honoured fundamentals including diversification, cash flow and profitability.

“The instincts and skillsets of both these mega investors combined will be a powerful strategy for any investor.”

Last month, the deVere CEO noted: “If you do want the thrill or novelty of chasing big gains, you really should ensure that you have a sound, diversified, long-term plan beforehand.

“There’s a major difference between investing and gambling.”

Nigel Green concludes: “The stock market is becoming ever-more democratised. This is a good thing.

“But the leaders of this new era must exercise responsibility and investors must exercise caution.

“The future of investment is this fine line between forward-thinking drive and old-fashioned principles – and it underscores that nothing can help you create, grow and safeguard your wealth, like quality advice.”

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Nigerian Exchange Limited

Nigerian Equities Market Sheds N103 Billion in Three-Day Trading of Last Week

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In a brief yet impactful trading week marked by Eid-el-Kabir celebrations, Nigeria’s equities market closed in the red as the market shed a total of N103 billion in market capitalization.

Investors navigated through a condensed trading schedule that spanned just three days, with profit-taking activities predominantly affecting key sectors despite selective bargain hunting in others.

The Nigerian Exchange Limited (NGX) All-Share Index (ASI) closed the week at 99,743.05 points, reflecting a decline from the previous week’s high of 99,925.29 points.

Similarly, market capitalization dipped to N56.423 trillion, down from N56.526 trillion recorded in the preceding trading period.

Throughout the truncated trading sessions, the market experienced two days of negative closes, contrasting with one day of flat performance.

Analysts attributed the decline primarily to profit-taking activities across critical sectors such as insurance and banking, which overshadowed gains observed in oil & gas, consumer goods, and industrial stocks.

The NGX Oil & Gas Index saw a marginal decrease of 0.21 percent, while the NGX Banking Index dipped by 0.04 percent.

The NGX Insurance Index recorded the steepest decline, falling by 1.41 percent during the week.

On the other hand, the NGX Consumer Goods Index rose by 0.29 percent, and the NGX Industrial Index saw a modest increase of 0.10 percent.

Despite the downturn in market performance for the week, the year-to-date (YtD) return moderated to 33.39 percent, indicating a resilient overall performance in 2024.

Month-to-date (MtD), the market managed a slight uptick of 0.43 percent, underscoring the mixed sentiment and cautious trading observed among investors.

Market analysts and stakeholders emphasized the impact of profit-taking in driving the market’s decline and suggested that the upcoming weeks could see renewed activity depending on economic indicators and investor sentiment.

As Nigeria’s equities market continues to navigate various economic dynamics, stakeholders remain optimistic about potential recovery and growth opportunities amid evolving market conditions.

The holiday-shortened trading week underscored the volatility and resilience of Nigeria’s equities market, highlighting both challenges and opportunities for investors in the coming sessions.

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FBN Holdings, Fidelity Bank Lead Trades as Nigerian Stock Market Closes Flat

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For the first time in weeks, Nigeria’s equities market closed flat on Thursday as investors adopted a cautious approach, taking a “wait-and-see” stance.

Despite active trading in major stocks such as FBN Holdings, Fidelity Bank, Transcorp, Access Holdings, and AIICO, the market showed no significant movement.

On Thursday, investors exchanged 1,299,961,984 shares worth N25.326 billion in 8,364 deals on the Exchange.

However, the trading activity did not translate into a market shift.

The NGX All-Share Index (ASI) and Market Capitalisation, which stood at 99,842.19 points and N56.478 trillion on the preceding trading day, closed Thursday at 99,842.94 points and N56.479 trillion, respectively.

This static closure occurred despite notable performances from stocks like Champion Breweries and Chams, which rallied.

Conversely, Transcorp Hotels Plc, NEM Insurance, and Fidelity Bank topped the list of laggards.

“We anticipate a mixed trading session with potential buy-side pressure in key names that could steer the market to a green close,” stated analysts from Lagos-based Vetiva Research in their post-trading note. “Investors are expected to monitor movements in high-performing stocks as well.”

Related developments highlighted the challenges facing investors. Rising diesel prices have surged by 66%, hitting the Northeast hardest.

The Naira remains weak at the official market despite rising external reserves, and prime office tenants face dilemmas with dollar-rents surging 200% in Naira value.

The flat close on Thursday underscores the cautious sentiment prevailing among investors in Nigeria’s equities market.

The market’s performance continues to reflect broader economic uncertainties and investor strategies focusing on stability and risk management.

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Nigerian Exchange Limited

Foreign Equity Trading in Nigeria Jumps 437%, Reaches N334 Billion in Early 2024

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Nigerian Exchange Limited - Investors King

Nigeria’s stock market has seen a remarkable surge in foreign investor activity, with equity trading by foreign investors skyrocketing 437% in the first four months of 2024.

This growth has pushed the total value of foreign equity trades to N334.01 billion, a significant increase from N62.18 billion during the same period in 2023.

Data from the Nigeria Exchange Limited (NGX) reveals that between January and April 2024, Nigerian stock investors exchanged equities valued at N1.894 trillion, a sharp rise from N721.44 billion recorded in the corresponding period of the previous year.

Foreign investors accounted for 17.63% of this total, while domestic investors dominated the market with 82.37%, trading N1.560 trillion worth of equities.

The increased foreign participation peaked in April 2024, with foreign investors trading N120.83 billion worth of stocks, representing 34.90% of the total value traded that month.

This surge highlights a growing confidence in Nigeria’s equity market despite broader economic challenges and a competitive fixed income market.

Analysts attribute this spike in foreign equity trading to various factors, including attractive stock valuations and improved regulatory frameworks.

“We expect continued interest in fundamentally sound stocks,” noted analysts at Comercio Partners, highlighting the positive market return of 33.64% by mid-June 2024.

Despite the attractiveness of fixed-income yields, particularly with Treasury bill rates reaching as high as 23.3% for one-year T-bills, participants remain drawn to equities, seeking growth in undervalued stocks.

Meristem research analysts predict a mixed performance in the equities market, driven by positive momentum and cautious trading.

The influx of foreign capital comes as a positive sign for Nigeria’s economic outlook, reflecting investor confidence in the nation’s regulatory and market reforms.

The NGX has been proactive in boosting market accessibility, recently launching a USSD platform to provide real-time stock market information, a move aimed at enhancing financial inclusion and market participation.

Prominent stockbroking firms have also played a crucial role in this trading boom.

CardinalStone Securities Limited led the market by trading stocks worth N197.535 billion, followed by Stanbic IBTC Stockbrokers Limited and United Capital Securities Limited.

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