We came up with a list of stocks that have a considerable level of liquidity and are transparent. We avoid stocks not found on this list. If you are new to the Nigerian Stock Exchange (NSE)and have no clue about how it works, then we suggest you first of all read this article.

There are over 180 stocks listed on the NSE. This is extremely small compared to stock exchanges of advanced economies e.g. the New York Stock Exchange has about 2,800 companies listed; London Stock Exchange has over 2000 companies listed while the Johannesburg Stock Exchange has about 388 stocks listed.

WHY YOU SHOULD BE CAREFUL ABOUT WHAT YOU BUY
While we acknowledge in anguish that there are not enough companies to choose from on the NSE, we also have a challenge with liquidity. This means despite the 180 stocks or more that we have, most of them do not have the right volumes that can facilitate a trade (buy or sell). After all, you can only buy or sell or stock if there is liquidity for that stock.

Apart from liquidity, most stocks on the NSE hardly release their results on time and when they do it is often too late. Most are also badly run with little to no transparency on what is going on with their products and services, employees and general operations.

We looked at these issues and came up with a list of stocks that we believe have considerable level of liquidity (frequently traded) and are somewhat transparent. We won’t touch any stock not found on this list. This list may be updated from time to time.

Disclaimer: This list is compiled by Nairametrics Research Team and is not a piece of investment advice or recommendation. Always consult your stock advisor for professional guidance on what, when and how to invest.

See the attached PDF document.

SOURCE (abridged): https://nairametrics.com/2019/10/06/nigerian-stocks-we-wont-consider-buying/