₦airaland Forum

Agbaletu:
You just need to calculate very well. Once you see an area that has the potential for future development, just lock your money there. I miscalculated in one of my plots that I bought somewhere in Ogun, but the one in Abuja is appreciating every month. The one in Nasarawa is depreciating everyday.
Sometimes, you can have your fingers burnt. I bought a plot in 2010 somewhere close to Abuja in Nasarawa State, I was shocked when I learned that the current price of a plot in that village is just 200K. I bought it for 250K from NSCDC Cooperative.

Thanks for sharing sir.
Obviously, speculating with land is the deal, not just building for rents. Anyone here has a good experience with rental income?

Meanwhile has anyone noticed that CBN didn't get to sell all the 364-day bills they auctioned yesterday. They weren't too willing to move up rates.

Agbaletu:
He said it was built in 2004 at 7MN, but sold for 35MN in 2015.

I'm still working on my fears concerning real estate.

But I would like to point out that if you put 7m into T-bills in Jan 2004, by Dec 2015, it would have amounted to 37m, assuming a compounded annual interest of 15%. (in late 2015 t-bills returns were below 11%, but in 2017, they were above 22% so 15% average is somewhat realistic).

Meanwhile there was this research earlier this year by Investment One or so, that showed that buying GTB shares with 7m in Dec 2008, your total returns by Jan 2018 would have been 77m.

I still have real estate on my radar though.

priscai:
FBN LAGOS TB 11% @ 191 days. Ecobank fixed deposit is offering 11% please for 365 days.

Please which of them is more viable.
Kindly help.

Considering the 10% withholding tax, the FD's return is effectively 9.9% p.a

Considering the upfront interest payment on the T-bills, the returns is 12.36% p.a and 11.68% for 191 days.

So, obviously, 11% may not always be 11%.

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Calebbold:
Please, how does devaluation of the naira reduces the value of one's investment in TB or fgn bond? Is it that if you invested 10m initially for example, ur capital automatically becomes less due to devaluation?

The major reason why it's so is cos the bulk of the items we consume come directly or indirectly from the international markets, and are priced in USD.

When the dollar exchanged for 199, 10m was $50,000.00
Now that it trades at 360, thesame 10m is less than $28,000

There wouldn't have been any problem if your Honda Accord, LED TV, fuel, wheat or raw sugar were all sourced locally, but since they rather come from the international markets, the implication is that the 10m that could buy 2 units of the Accord sedan just some few months back, can now barely buy just 1.

zamirikpo:
Pls don't forget to update us when u start seeing signs of an imminent currency crisis cos I don't know how to check for them......

Then for eurobonds how is it done......

Like ahiboilandgas stated:

1. Low oil prices;
2. Low output levels;
3. Declining forex reserves;
4. FPI inflows vs outflows.

These are the major things to watch out for.

Eurobonds are just like FGN BONDS. Just that they are denominated in a more stable currency (USD) and hence offer lower yields.

joseph1013:
Is there any thread I can get more information about Eurobond? I'm interested.

They are bonds denominated in USD. You may need up to $200k to buy. However you can buy dollar mutual funds to get around that.

check here for more:


https://www.nairaland.com/4524641/fgn-bonds-investors-hub#67883603

zamirikpo:
In as much as i have all my lives saving in TB I still feel it's too risky holding cash as a store of value. We could wake up one day in 2019 And discover that a dollar is now worth N600 ur money in TB or bonds automatically losses it value by almost 40%.

I am holding cash today with the intention to invest when I find something worth investing in, but for now TB wins it, I have my heart set on buying land in developing areas with TB interest payments when it's possible. I wouldn't want to keep all my money in one sector of this economy

So for the guy that wants to sell , a poorly developed environment suffers from the law of diminishing returns and so selling isn't a bad idea but don't put everything in TB or bonds.....diversify . First replace the land/house u want to sell with another land somewhere else , it may amaze u to know that in future it may look like u just relocated the property cos it will have the same if not more value than the entire property u r selling now.

Then put the rest of ur money in TB and enjoy the returns.

You can never go wrong with diversification.
Some who know their onions in real estate, could easily make double the returns on T-bills.

As per the issue with holding naira assets, when I start seeing the signs of an imminent currency crisis. I'll switch to eurobonds ASAP. 6% guaranteed with a potential for much more.
For now, there's some comfort.

ahiboilandgas:
rental income is just wrong investment...u need to buy land in developing area then speculate

Sure sir.

I think though that for all forms of speculations, your risks have to be calculated, which implies that you need access to some privileged info.

fyneIjay:
Thanks for your advice. But, are there any downsides?
And the expected rental income is not even up to a million naira.

Depends,
Like ahiboilandgas stated, if your location still has some potential developments in the near future, there could be huge capital gains. But for places already developed, say gra, the likelihood of capital gains is slim.

What I consider to be the greater downside is the fact that it could be difficult to hold on to cash. I mean there'll be tendency to just spend, especially since it's family funds as you have stated.

It may be better to buy 10-30year bond, or stocks when prices crash to push dividend yields to c.15%. You'll get annual dividend payments, and there could be capital gains that'll even double your capital.

You guys will have steady income to even pass down to the next generation.

fyneIjay:
Thank you.
I will like to seek the house opinion on something concerning investment.
We have a house somewhere, which is given out to tenants. After the first payment, they always find it hard to follow up promptly in paying subsequent rent. My brother has been suggesting for some time to sell off the house and invest the proceed in Treasury bills or do fixed deposits with it. That it will still give us more than the income we are currently getting from renting it out and the capital will still be intact.
I need opinion and advice on this. (if sold, we could be realizing 25M or more from it and 20M will be invested, at least 10M in TB)

I am not such a big fan of Real estate.

Based on the 25m million you quoted. I'll assume your expected rental income is 1.8m or less.

If you put 25m in t-bills at 14% yield. You'd be getting an income of 3.5m annually, almost 300k monthly. That's virtually twice the maximum rental income. Plus no need to worry about vacant flats or tenants defaults or delays.

Last year, T-bills yield were above 22%. you could have earned 5.5m on your 25m investment.

Phyde:
Good day greatmen, please what will be my return after 5 years of 1.5m input on this bond thing?

Let's say you get a yield of 14%. You'll be getting 105k every six months for the next 5 years.

kejykejy:
Hi guys, pls am new here and am intersted in this TB. Pls if am to invest 1m for 30 days, how much will be my returns.
Which bank is the best bank to use.
Thanks

9k or less.

jayeomoba:
Please when is the next TB sales considering the last one was on 13th June, 2018. Your response will be highly appreciated. Furthermore I do not really have a full grasp of how the primary and secondary market works, I just have a fiant idea. I will appreciate if anyone can still further educate me

Next Wednesday June 20th. You'd have to be at your bank ASAP on Tuesday.

freeman67:
Understanding are welcome...! Then you should get your proof of investment for complete info.

The 10.2 he quoted is just the stop rate.

yanjutomi:
thanks for ur explanations and tutulage. the information given is my balance after deductin

The 10.2 you quoted is only the stop rate.
From the info you gave, your bank invested your funds at c.10%

freeman67:
Please forget all figures you see people brandish here.. Just concentrate on how to build yours. Stanbic IBTC, FBN, GTB and Sterling are banks that I know does allows 100k for TB investment. FBN lowest as much as I know is 100k. Good luck

There's nothing like starting now and growing your funds consistently.

eromosele1986:
Thx for the response, since 91 days is 10.2% and 364 days is 11.5% is it not better to do 91 days then renew it after its expires.

No, it's not sir. Quoted rates are per annum. The 10.2% is effectively 2.55% for 91 days ( 1/4 of 10.2%)

May's inflation at 11.61%
https://nairametrics.com/inflation-rate-drops-for-the-16th-consecutive-time/

Seun:
How can you "curse" something that doesn't exist?

Explains the confusion you guys have.

Why don't you put up such a strong cause at convincing people against the existence of Santa Claus?

If "god" were merely an illusionary phenomenon, why should it bother you so much that people believe in Him. Confusion-that's what explains it with you guys.

fxuser:
Nigeria’s central bank will start to auction the Chinese yuan within the next month at an exchange rate to be set via book building, an official said on Thursday, in an attempt to reduce its reliance on the U.S. currency for imports from Asia.

link:
https://af.reuters.com/article/africaTech/idAFKCN1J40VN-OZATP

#GoodMove

The other one says Libya.....

https://www.reuters.com/article/nigeria-china-auction/update-1-nigerias-central-bank-to-start-auctioning-chinese-yuan-idUSL5N1T95B1

sub 300 dollar rate before end 2019.

freeman67:
No.. The charges have already been deducted from you interest. That 114k is what you will get.

Aim07:
This what i got from my investment with fbn, does it mean my principal will still be charged for those charges? what does d 0.0 naira interest indicate?

amt invested 105k
tenor 290days
rate 11%
28/05/18 to 14/03/19
principal at maturity 114k
interest #0.00

please note that ur interest on investment is subject to these charges 0.1% custody fee, #100 transaction fee and 5% VAT.

i need answers please

NL1960:
How much was debited from your account?. Was it the 105k invested?.

Aim07:
This what i got from my investment with fbn, does it mean my principal will still be charged for those charges? what does d 0.0 naira interest indicate?

amt invested 105k
tenor 290days
rate 11%
28/05/18 to 14/03/19
principal at maturity 114k
interest #0.00

please note that ur interest on investment is subject to these charges 0.1% custody fee, #100 transaction fee and 5% VAT.

i need answers please

I think the investment was made together with the upfront interest. That explains why principal at maturity will be 114 k and not 105k.

Investnow2017:
Gentlemen, I have long been away. When is the next auction, please?

13th June.

bulalakoboko:
Thanks I had done what you suggested. I found what i really wanted Thank you sir. One more thing is I subscribe with 2M at 10.5% in May 2018.I needed the fund in july though. My question is should i terminate now or wait till end of july. Thanks alot

By the end of July, rates are likely to be higher than they currently are. (+200bps maybe) So it'd be basically cheaper to liquidate now if you have an alternative vehicle to invest the funds in between now and end July. An MMF would make a good one.

bulalakoboko:
Hello fellow investors. Please i need assistance/ advice as regards redeeming my TBills before maturity. I subscribe for my tbill at stanbic though i have had couples of tbills transactions but i am a newbie when it comes to redeeming fund before maturity. I needed the money urgently. How do i go about it in stanbic IBTC. If anyone has done it before pls show me the way
Thank you very much for your reply in advance.

You could enter the term "premature termination" into the search bar of this page. It should show you past discussions we've had.

However if you give details such as when you bought, the rate you got and the tenor, I'll see about giving estimates of what your termination proceeds would be. Good thing is Stanbic is pretty good with early termination.

dipoolowoo:
CBN Releases Treasury Bills Issue Calendar for Q1 2018
https://www.businesspost.ng/2018/06/06/cbn-releases-treasury-bills-issue-calendar-for-q1-2018/

Q3 you meant sir.

Good news is for the first time since Q3'17, they'll be selling over 1trn worth of these bills. one may want to slow down on buying long tenors now.

GODAKPAN:
Thanks boss, can in get this at the banks?

As soon as I get through to zenith or FBN, I'll give updates.

spenca:
What you have there boss is the yield to maturity (YTM)
TRR : total rate of return

Thanks sir.
So which one is often quoted for bonds? the yield to maturity or the coupon yield? I'm thinking it's the yield to maturity. is it?

engrken2:
OK so can one invest 100k-1m in any of this... Which one can give us high yield.. If no please notify us wen

currently, it's only the savings bond I know has very low threshold (even below 100k),
Gaverilino mentioned that one can buy with 10k upwards from GTbank, and i earlier posted that a rep from Stanbic said 5k upwards. I kinda feel these may be old figures.

maybe you could try asking your bank too.
I want to also find time to ask at FBN and maybe Zenith too.

After meeting the required threshold, buying is as easy as filling a form, or writing a letter.

ease of premature termination is also to be keenly considered

RabbiDoracle:
Witheld by the broker? Then that is the CGT which is an income for the investor na.

I hope they'd be willing to bear 30% of capital losses too.

RabbiDoracle:
Are you sure it is witholding tax? Isn't it Capital Gain Tax?

The CGT is taxed at the same rate as income taxes and it gets higher if you stay shorter in the market compared to those who stay longer like Warren Buffett.

Write up says 30% tax on income is withheld by the broker, and no capital gains tax is charged on foreigners' portfolio.

https://www.fool.com/knowledge-center/can-a-non-us-citizen-trade-us-stocks.aspx

For bosses in the house doing US equities, I learnt WHT is charged at 30%(at least for foreigners). Has that been your experience so far?

Given that dividend yields are mostly sub 3%, does 2.1% investment returns make it worthwhile enough?

engrken2:
My sincere appreciation to various explanatory ideas.. But we will want more direct and practical bond sale prospect when ever there is or if there is any in the market now...

You can always buy bonds on any given day at the secondary market through your banks, brokers or investment houses.
The issue we're trying to walk around is the minimum investment threshold.

So far we have:
FSDH 50m
GTI securities 100m
Afrinvest 20m
FGN BOND Primary market 50m
FirstBank Eurobonds $100k
Most other Eurobonds $200k