₦airaland Forum

That you are buying stocks does not make you an investor...

#Selah...

What exactly is value investing?

Find answers to this and many other questions in this very informative episode... It is certainly worth your time...

https://anchor.fm/ajibola-oladele-awolowo/episodes/What-value-investing-is-and-isnt-evgdgl

In this episode, we retrace the history of the Nigeria Stock Exchange and talk through various salient points to remember when deciding on a stockbroking firm to transact business with.

Enjoy...

https://anchor.fm/ajibola-oladele-awolowo/episodes/History-of-the-Nigeria-Stock-Exchange-Choosing-a-stockbroker-ev56nu

https://anchor.fm/ajibola-oladele-awolowo/episodes/The-Language-of-Investing-eum8dj

Ever travelled to a foreign country only to discover that you could not speak the local language and could not communicate?

To successfully navigate the practice of investing, it is important we learn the basics about the language of investing - Basic accounting!

In this episode we share basic information about what financial statements are and how to understand them.

Enjoy...

Agbalowomeri:
Get ya umbrella
The rain is about to get heavy

Correct...
I have washed my GP tank...
Let's go there!!!

THE PURSUIT OF SHINY NEW THINGS

"We learn from history that we do not learn from history"
Georg Hegel...

Bugs are attracted to light. The reason why this is may be a thing of public debate but the simple undisputed fact is that, bugs are attracted to light.

Theory such as light being a source of warmth and light being a path to escape from predators exist in a bid to explain this phenomenon but there is no consensus reason as to why this is.

Man has used this phenomenon to his advantage. When you need to get rid of bugs, attract the bugs using a good light source then zap them with electricity (insectocutor) . Cruel but very effective.

I am not an entomologist (someone who studies insects) but I am keen to understand certain human behaviour. History has proven time and time again that, like insects who are attracted to light, mankind is attracted to "shiny new things". Unfortunately for mankind, mankind has also developed a zapping device that zaps anyone who goes too close to these shiny new objects.

The shiny little object that is the subject of my write up today is "earning out-sized returns". Oh, how mankind is desperately attracted to this shiny object. They pursue it in droves like a band of flies pursues an insectocutor only to receive a painful and often fatal zap in the end.

Ponzi schemes specialise in promising huge monthly or quarterly returns only to dash the hopes of people who subscribe to them. The plot is always the same. There is no change in the script from one hot new scheme to the next. You'll think mankind should have learnt to avoid these shiny objects by now.

Unfortunately, we are lured thoughtlessly to them as a hoard of zombies are to the smell of fresh blood (that's if the movies are anything to go by). Stories abound of people who lost huge sums of money to these schemes!

How can one know which objects to avoid?
An object that everyone, professional and non-professional, know about and recommend is most likely the next shiny object in the long line of shiny objects still to come. Avoid them like a plague!

You are better off ruing the chance of making a huge profit than crying over lost capital. You can often make up for the former but the latter can be devastating.

This advice even covers traditional investments and new investment frontiers as well. Think of cryptocurrency, stocks, real estate, commodities, fintech etc. Remember the Internet stocks craze and the  real estate bubble a couple of decades ago.

The next thing I'll advice is to seek knowledge. The more you learn about your mistakes and that of others, the less likely you are to making them. Learn how the real world works and you'll naturally see yourself drift away from shiny objects effortlessly.

In wealth building, slow and steady does you much more good than fast and furious can ever do...

Anyway, this writeup is probably a waste of digital ink. We've learnt from history that we do not learn from history...

This week, we draw lessons from how companies are born... Keep learning...

https://anchor.fm/ajibola-oladele-awolowo/episodes/How-companies-are-born-eu6ich

The concluding part to our first episode on the podcast...

Listen, learn (hopefully) and give feedback...
Very many thanks...

https://anchor.fm/ajibola-oladele-awolowo/episodes/10-commandments-of-wealth-and-living-a-fulfilled-life-Part-2-etm4id

maishai:
Why should one invest in something other than banks on the nse

Anytime I look away from banks my heart bleeds.....

Without banks, investing in the nse is utter waste as the minimum to recoup ones investment is a minimum of 20 years

You are probably not looking hard enough...
The more stones you turn over, the higher the probability that you'll find a gem...
#Selah...

I recently started an experiment, a podcast, titled "Value Nigeria with Ajibola"... Its a platform that I hope will be educational both for the listeners and me..

I hope to share things I've learnt about value investing as it relates with the Nigerian Market...

Kindly find the link to the first 2 episodes below... Forgive the poor audio quality of the first episode.. It was greatly improved on in the second episode...

Thanks for listening and for giving me your feedback...

https://anchor.fm/ajibola-oladele-awolowo/episodes/Welcome-to-Value-Nigeria-esir3g

https://anchor.fm/ajibola-oladele-awolowo/episodes/10-commandments-of-wealth-and-living-a-fulfilled-life-Part-1-et4ms1

Your thoughts?

samguru:
https://dariusforoux.com/stoic-path-to-wealth/

Good morning all and have a bullish week

Thanks for the link...
It was a good read...

Tvegas:
Presently Selling or Buying is at the tip of their fingers.


Meanwhile is this Dr Awo, my old friend whose activist Dad was a celebrated lecturer in Unilag?

You have spoken well...
The bolded above is the more reason why things will be the same...

The most dangerous words in investing are "This time, it is different"... History may not repeat itself but it surely does rhyme...

I am not that Dr Awo unfortunately... Thanks for asking sir or ma....

maishai:
Sir, kudos to your good works, different strategies are rife in here.....,

I'm currently sitting on over 100% profit on all stocks I bought during covid saga

Please help me and the house by announcing stocks that are overpriced as the reports starts churning in

I still see a little steam in the engine of some stocks notably wapco grazing #40,zenith smelling 30 bucks, uba kissing #10

Cc
All nsempa nembers

Enjoy your loot my brother or my sister...

Mcy56:
Sir, reading this part again, I'll say I don't really understand it.
What makes the dancers to be tired?
Do you think the stocks are over-priced?

What I was saying is that, persistent increase in prices may mask the point when things become overpriced and slip into "bubble" territory...

So, let's thread carefully and with open eyes...

Mcy56:
Oga mi, don't know if you're referring to my post on HWF.......
Well, Bigjay answered you right sir.
As for HW, it's a penny stock and I know Nsempa old wines especially are not favourably disposed to it.......BUT, boss, just know I did some background checks on it before posting it here......and the word gamble doesn't really mean "gamble" in it's real sense, but to absolve myself of at blame from whosoever wants to take risk in the stock..........so he/she would know that risk is involved.

OluwaMercy...
How dare I refer to you? Not at all...
I was just pointing out the state of things generally on the thread...

I totally understand why everyone uses the word gamble. We are all trying to absolve ourselves of blame if things go wrong as they sometimes do...

The word in itself just proves that there is a lot of speculation in the market now which is a sign of impending "financial endtime".

The drumbeat being loud and strong does not mean that the dancers aren't tired...
#Selah...

bigjay01:
Speculation is part of the dynamism in the market.
In advanced climes, speculators full ground wella!
Am sure you must have heard about the reddit-gamestop-robinhood brouhaha. What do you think it is?

I understand perfectly well...
Its a simply sign of where we currently are in the grand scheme of things (market cycle)...

For the NSE, another 2008 loading...

It's indeed amazing how discussions on this thread has gone from investing to gambling...

Is that what we have become now? Maybe I am being too critical though...

Happy investing...

Sorry... My mistake...
Happy gambling...

Is NSEMPA our own #WallStreetBets?

currentprice:
http://www.nse.com.ng/Financial_NewsDocs/32228_JULIUS_BERGER_NIGERIA_PLC%20_YEAR_END_%20_FINANCIAL_STATEM.pdf

If they were a bereau du change, this would have been a fantastic result...
Gains from foreign exchange translation to the rescue...

ositadiima1:
You have a valid point, but so is the run we experienced in the insurance sector;

1. LINKASSURE has made over 80% and the last time they paid dividends in the last 6 years was 2018 (5 kobo)
2. ROYALEX has made over 70% and paid dividends two times in the last 6 years. 2014 (5 kobo) and 2015 (2 kobo)
3. NIGERINS has made over 50% and paid dividends tree times in the last 6 years. 2014 (8 kobo), 2015 (4 kobo), 2016(4 kobo)

Dividend wise CAVERTON has maintained above 6% in the last 3 years and above 10% in the last 2 years.

But again it is possible I am not seeing the whole picture sha.

We all know that the insurance sector bull was largely driven largely by speculation and not necessarily by fundamentals...

Speculation on the dividend can as well drive cavertons' prices upwards...

Realistically, if I owned caverton, I'll not be expecting a dividend this year. If it happens great, and if it doesn't, I won't be surprised...

Oga Ositadiima, check your email! Haba!

jideflash:
At current price caverton has a divended yield of 10%.
Q3 2020 EPS = 34kobo

there was 55% drop in profit, this was largely due to finance cost as aircraft leasing & loan servicing is in dollars.
Also operations slowed down due to slump in the oil industry.
Also ViP charters also reduced due to lockdown and less travel unlike the election year.

Positive Outlook.
Oil price recovery. Their main revenue is from long term contracts with IOCs.
Completed purchase of S92 helicopter for a new contract starting Q1.
Upcoming Launch of 2 subsidiaries with waiting clients
* Training: (equipped with the most sophisticated Flight simulator, 1st of a kind in SSA)
* MRO: with partner already signed with Bell, Airbus and Agusta Westland (aw149 is the most used commercial helicopter in west Africa)

I like your line of thoughts...
I just want to sound a word of caution with this coy.

Before you make assumptions on the projected dividend they'll pay this year, I'll advice you look at their dividend history alongside their EPS for each year. This company is known to withold dividends in years when they have hit a rough patch... They have hit a rough patch in 2020 just as you have noted...

If you are buying, buy for the long term. If you are buying for dividends, this coy might shock you...

Happy investing...

Investing is not a team sport...

#Selah...

megawealth01:
That stock has been down na... It's not suppose to sell below #5

Why should it sell above N5?

ositadiima1:
Some results:
1. Stock data: March, 2020 to December, 2020
2. In total 20 trades: 18 winning trades and 2 losing trades.
3. Used 500,000 per trade
4. Total turnover was 10,000,000
5. Profit after trading fees 3,894,000

In fact, I will be adopting this strategy after a few more tests

#systematic_trader

As always, it's refreshing reading your post...

I just wanted to high light a few things based on this strategy of yours...

2020 was quite a generally bullish year... Anything investors touched turned to gold, literally (Japaul is a good example... Lol)

Basing your conclusion just on data from March to December 2020 might not be the best. I'll advice you back test your theory for a couple of years. That's might give a better representation of reality over various market conditions (bullish and bearish markets)...

Well done!

Besides, I tried sending you an email... Kindly check your email associated with Nairaland... Kindly get in touch... Thanks

Rabbi4real:
Good morning sir, Pls were can i get this 6years summary?

I collate the data myself from annual reports of the companies...

You can however check financial sites like Morningstar.com as they often have similar info...

Fidelity Bank 6 year financial analysis...
Enjoy...

PharmAlfred:
Yeah. Access has a poor dividend history. Let's see what they do this year.

To be realistic, anyone expecting Access bank to pay a comparable dividend with other banks does not really understand their growth model...

As long as they continue growing via inorganic means, forget high dividends from them...

The monies they use in doing acquisitions has to come from somewhere.... If they start paying a high dividend, I'll be disappointed...

PharmAlfred:
Access is hugely undervalued. See it trying to rub shoulders with the big boys. Hope it moves someday. Nigerian coys are largely undervalued though. Most pay dividends way above most celebrated international companies.

This picture does not do justice to comparisons between GTB, Zenith and Access banks...

For the picture to be complete, it would be nice to see their total revenue, equity, assets and liability as well...

We need to know how much they invested to make this amount of profit... That will help us compare apples to apples....

[quote author=RoadAnimations post=97798078][/quote]https://www.proshareng.com/news/Debtors---Recovery/The-Ecobank-and-Airtel-Story--Surviving-/55005

Just read the above article...
It does a pretty good job of giving a background, present state and possible future insights into the drama surrounding ETI and the airtel shares saga...

Lion123:
https://www.thecable.ng/access-bank-completes-acquisition-of-zambias-cavmont-bank

Access Bank acquires Cavmont Bank. That means lower dividend for you people because money must come from somewhere. And Access still wants to buy Atlas Mara. What does Access really want?

There are 2 broad ways of growing a business...

The first is organic growth which is slower. The orga isation chooses to grow from within. Get on division right and then open another division... Zenith bank has chosen this path and is the master of it...

The second is inorganic growth... This is growth by acquisition... Its faster but has a whole lot of disadvantages... You inherit the problems of the acquired company...

Example is Access and Diamond bank... Their NPL went up crazily after the acquisition but so did their assets, customer base etc...

Look at ETI and oceanic bank as well... They just wrote off all the goodwill in their assets incurred during the acquisition... Look also at their trouble with o&o and airtel shares... ETI might take a 22 billion naira hit if the court rules against them just because they acquired oceanic banks problems...

Either way, Access has chosen to grow inorganically... They would have learnt from their diamond acquisition and might do better in future acquisitions...

If you are interested in Access bank, I'll recommend you keep an eye on their goodwill assets as they acquire companies... Keep a close watch on their ROE and more importantly, ROIC...

Any sustained decline in ROIC should signal that things are deteriorating...

ositadiima1:
2012 to 2020 : Mean Reversion Variant

as u can see bellow the initial 1mil in 2012 generated 1.127 mils in 8 years. Very poor.

I think you are onto sonething really really profound here...

If I were to give my own 2 cent opinion, I'll advice you do the following

1. Rather than one month, look at a 1 year time line
2. Buy the 10 worst performers for the out going year and hold them for the next year.
3. Sell them at the end of that year and use the proceeds to buy the 10 worst performers for the year now ending

I strongly feel you'll have better results using this parameters...

All the very best. If you can do this, it would be I teresting to see the results...

Thanks!