₦airaland Forum

Here is my understanding regarding exchange rate issues Nigeria is being suffering.

Going 100% free-float:
In this case the exchange rate is completely left to demand/supply. Here Naira will even go down much further, expect 1000 Naira to USD or even more with fluctuations. This is because Nigeria buys more than it sells (Inport vs Export) - Deficit in Balance of trade.

Going 100% fixed rate:
In this case the government acts as middle man (Market Maker), using its deposit as buffer. Again, because Nigeria buys more than it sells it puts strain on the deposits (ever decreasing foreign deposits).

The superficial and quicker solution adopted by present administration was to use a mixture of the two. A more deeper and lasting solution is to improve overall productivity of d Nigerian population.

pizapato:
Lol
So what do you think the actual rate should be


This same argument of the rate being artificial has been on since since 2020 and it kept inching upward.

I can remember awesomeJ discouraging people from buying back then when it was around 430, before we say jack it hit 470 from there it has been on upward trajectory

Even the official rate we are seeing today is probably not a reflection of the true situation of things because the current administration (ruling party) can't afford to devalue further because election is around the corner.
Don't be surprised that the next administration might devalue naira further to close the gap between official and parallel market

Like people have suggested earlier, it is better to split one's holding, some be in USD some in naira.

If you can get it between between 550-600 buy and hold.

I don't think the parallel market (PM) is going to deviate by "alot" from official rates and stay there very long.

PM is affected by 2 forces - the demand/supply and official rate.

Seunn11:
The Unipolar world economic order is being tested rigorously as we speak.
At best, the world has slided to pre-90s in terms of world economic hegemony. Russia is not really perturbed by US. Their balance of trade is superb. China is solid. Even India is flexing. USA's power is eroding quickly. Britain is playing catch-up.

Welcome to the new multipolar world order. This world order will also not last long before a true New World Order emerges. This ultimate world order will not be bounded by state borders. Mankind seems to be at war.

I don't blame the West for being arrogant or bossy. When you are the one who contributed more than 90% to the world prosperity over more than a century you did act the same way.

The world is more productive and prosperous because of d west and their contributions, here are a few:

Innovation: Internet, Computers, Modern Algorithms, Communication, Flight, medicine, the scientific process etc.

Economics: Industrialization, Stock exchange and Capitalism, Modern Economic concepts. etc

Institutions: Financial Institutions, Legal Institutions, Administrative Institutions, Formalized Education etc.

You don't overthrow someone like that easily, expecially when they have a finger in every pie that matter.

RabbiDoracle:
So who is posting for likes and to garner cheap praise? Hmmmm... Na wah for some people thought process.

Read about Posco (the largest steel producer in South Korea) and see when they started producing neon gas.

Too late... I was trying to edit that part out, I was not referring to you.

RabbiDoracle:
Yes, Pareto principle.

You are not seeing the game changing events. You said DMs are leading in tech, and that tech runs the world. You seem to be missing alot of shows going on in this Ukraine war.

Ukraine is the world leading producer of highly purified neon gas used in making of chips. They produce 70% of the global highly purified neon gas. Without neon, no chip! Without chips, there is no tech industry!

Now Russia has taken over the Eastern part of Ukraine where all those steel plants that produce those gases are. And those Eastern parts are where Ukrainian agricultural belt is. So severe chip shortage to the tech industry and hunger to the world would result.

That is why you see US, EU, Japan and other western allies battle with Russia because that single gas is the soul of the tech industry. This battle isn't just about Ukraine. It is to save the tech industry which russia has taken easily. With this simple thing I have explained, tech industry can be marked down to zero once restriction starts on who gets neon gas or not based on Russian order.

When you see events like war happening, just don't look at the headlines. Look at games being played on the ground. The next front that could be opened up is this Taiwan - China which is brewing now and could get very bad seriously. This is another semiconductor nation. US will want to go all in on Taiwan because if it is taken, tech will be dictated by China or Russia. But US and EU seems weakened due to huge spendings from covid. And now you have increased commodity prices where countries will have to start supporting their citizens (equates to more spending) . Then will any sane country add war cost to these already ballooned costs?

In Chess, EU and US are in Zugzwang.

Not really.

Below is an excerpt from some site, it is up to you reader to verify its veracity.

Neon gas is a byproduct of steelmaking, and it is further refined to 99.99% purity in order to be used to produce semiconductors. It is used in the lithography process which transfers a semiconductor circuit design to a substrate, like a silicon wafer.

The nuance that has been missed is that neon is only used in deep ultraviolet (DUV) machines, not in the bleeding-edge, extreme ultraviolet (EUV) machines that are necessary to manufacture the most advanced semiconductors for smartphones, computing systems, and artificial intelligence applications.

The more obvious and important detail is that neon gas is a byproduct of steelmaking, which means there are several countries around the world capable of increasing the production of neon. China, India, South Korea, the United States, and even Japan come to mind...

RabbiDoracle:
Population in developed market economies is assimed to be 1.18b people in 2022.

World population is assumed to be 8b people.

Anything not in the DMs should be classed under developing and underdeveloped economies (frontier + EMs). And they are 85% of the global population.

Looks like the 80/20 rule is at play, the Pareto principle.

RabbiDoracle:
The game is changing fast. DMs are clutching onto the last straw.

The game is changing but not fast enough.

DM still lead by big margins in the fields of solid institutions, innovation and tech. Beneath the surface tech runs d world.

My layman opinion.

Problem with USA is their need to dominate d world. I see USA becoming more specialized.

RabbiDoracle:
(1) they continue to hike rates, they crush the consumers the more and kill businesses. And this collapses the spending habits of ordinary Americans as they grapple with hunger, higher energy cost and social unrest.

(2) they abandon the rate hike and start to cut rates instead and give out stimulus checks again. And this will create an increased money supply further causing more rush for available goods and services (presuming that China continues to restrict the supply of goods). This causes hyperinflation in no time.

Only China has the tuber of yam and the knife in this case. US seems relegated.

"The supreme art of war is to subdue the enemy without fighting." ~Sun Tzu, The Art of War

USA will probably get out of this with a few bruises. They practically invented modern economic theory. The people who will suffer are the emerging markets (expecially the ones low on d scale).

Lumping all the so called emerging markets together under the same canopy is not fair...

Nero4306:
Good evening house… hope we should be expecting our sukuk2 and 3 rental payment by 16th this month

Have u been paid?

yMcy56:
Lol.
I can't comprehend a single thing there.

Was referring to some of the large Institutional managers holding portfolios of stocks.

These portfolios are setup to match some predefined index weighting (meaning that each constituent stock has a fixed proportion of the whole).

When d portfolios deviate from target, d Institutional investors rebalance the stocks within d portfolio to maintain desired proportions.

His idea or problem was to figure out the rebalancing process - which stocks are bought/sold, by howmuch and when - to use it as predictive signal.

OBAGADAFFI:
I got Dangote Suger dividend

Is Dangote Suger and Dangote Cement paying same day?

DANGCEM don enter

DeRuggedProf:
This happens when you are investing against solid assets, NOT when you are playing a computer game of matching present numbers with previous numbers...
This one is called Virtual reality...

Playing computer games with numbers in essence is TA, people have hammered doing that. You get in while d momentum is on and get out at ur bustop. Holding crypto as a form of investment is a bad idea.

.

emmanuelewumi:
1.Business management or career management

2. Investment management

3. Money management.


Investors, employees and entrepreneurs try to do well in the first 2, but very few of them do well in Money Management.

Having more than 10% of your Networth in a risky asset that doesn't have a pedigree is poor money management

Lol, same goes for Naira or any currency for that matter. Cash over long periods is prone to many problems eg Devaluation, inflation, theft, time etc.

skydiver01:
"Interestingly surprised" is how I will describe it. Why? because whilst I expected it to crash to $ ZERO, I did not expect this fall so soon. More downside clearly on the cards.

BTW it has not and will never constitute 0% of my assets... I don't even know how to go about purchasing any digital assets because I am not interested. But as ever, best of luck to digital asset investors (crypto et al).

I don't expect it to crash to zero, except a similar and better alternative was implimented.

Crypto, especially bitcoin, remains a very good medium of exchange - decentralized, anonymous, fast, cheap.

As a store of value? I don't know cos it is not backed by any entity. Holders confidence mainly lies in its limited quantity and foolproof structure (for now... ).

I think it will bounce back once things go back to "normal".

skydiver01:
Am I seeing double? Bitcoin currently at $25.7k? Kai... Na wa ooo

Why are you surprised?

Last year bitcoin fell by over 50% from its highest point to $29.7k (maximum drawdown as it recovered quite a beat), why dat happened I am not sure, wasn't closely following the news.

With this years multiple issues - war in Ukraine, high inflation rates, increasing interest rates, high crude price etc - it is no brainer that bitcoin will be impacted.

We can reasonably project a 50% drop at some point this year as well (probably more). That should see bitcoin at $22.4k. That's where I would start buying in trenches.

Mind you, like I said before on this thread crypto shouldn't be more than 15% of ur total assets.

ositadima1:
I hope u read my initial post. Investing in bitcoin is ok, but the bulk of ur money shouldn't be in it(most gurus advice 5 to 15% of ur assets). I was responding to @jedisco who was implying that moving ur assets to crypto was a good way to edge against naira devaluation.

Like I said before, cryptos are purely speculative in nature.

seyisanya:
I'm yet to understand why some investors put all their eggs in one basket (company/sector). Well, different strokes(strategies) for different folks.

Reminds me of the insights I got from reading about MPT, modern portfolio theory. The idea was that an investor can select a bunch of investment vehicles in such a way as to optimize the portfolio for maximum return given a level of risk.

Investopedia says...
"A key component of the MPT theory is diversification. Most investments are either high risk and high return or low risk and low return. Markowitz argued that investors could achieve their best results by choosing an optimal mix of the two based on an assessment of their individual tolerance to risk."

and this...
"Based on statistical measures such as variance and correlation, a single investment's performance is less important than how it impacts the entire portfolio."

And then some math from which a curve is generated that evaluates the efficient frontier.

By d way, holding only stocks has its risk too. During a market crash d correlation between stocks tends to one and prices downwards.

thesilentone:
FBNH has already sold almost 4x its average weekly volume in two days this week with 3 more days to go.

It is trading in a range, some might call it a bullish flag but with the inverted hammers printing for a few weeks now, I wouldn't be bullish on this either which explains why I stated that it needs to hold 10.90.

It is below the weekly 30MA, volume is increasing and printed a doji last month. Support is at 9

FBNH is going back to above 11

thesilentone:
It is not bullish in my book BUT then again we use different parameters for conviction.

Readers: This has nothing to do with your fundamental views about the company so don't assume I'm saying sell.

Since July 2021, the on balance volume indicator (OBV) has clearly shown that GTCO is being gradually distributed (sold off).

Near #22 seems to be a major support, I guess if it should break support it's going to go much lower.

nna777:
$5532.85 is low na. Even in capitulation, Btc still has structure. There's a lot of structure btw $14k & $20k.

Based on charts from 2015, 2018 n 2020 when capitulation occurred, it was btw 30-70% drop below the 200 day SMA which usually takes place after the death cross. My best guess for Btc bottom for 2022/2023 is $14k3.

Last year saw 53% drop from peak that bottomed in July. If history were to repeat itself then 22.3k would be it.

nna777:
OPEC is meeting today. I don't see it spiking just yet. They have to step in to cushion the effects of EU ban on Russia's oil. This would be the catalyst to send Brent back btw $80 - $90. China and India have been buying from Russia at discount, so a correction is due after 5 months of green.

The West and Europe will breath a sigh of relief as inflation is already biting hard there. It has started already.

Why d need to send it back to $80 - %90?

Here my layman thoughts: Plausible reason could be that the current price is disadvantageous to Opec. But why or how?

1. Could it be due to reduced quota since China, India and few other countries buy Russian crude?

2. Could it be due to pressure from the USA? Does USA hold such influence on d Opec members?

3. Could it be that the inflationary effects on d dollar mean less value despite higher price?

If 3 is a major concern, then price goes higher not lower.

AngelicBeing:
That is why I took my dollars, climbed Mountain Everest to go and hide it there

If what I hear is true dollar is about to be hit with 2 digits inflation, and then, risk of losing its place as the international currency is higher than ever.

All in all, holding cash that is not generating returns (above inflation) is a bad idea.

But, I know you know these things already.

.

onegentleguy:
Some persons will probably think the price peg of INTEBREW is now high.
Well, just wait until we get to the N20 boulevard.

I maintain that the journey won't be smooth (price push up in view), but forward we shall move!

Again, Mid to long term HOLD!

It is well.

Hmmm...

In 2021, INTBREW made 182.3 billions, used 136 billions to make and sell their products, administrative expenses for 35.9 billions, marketing and distribution for 17.7 billions. At this point 182.3 billions was exhausted... More expenses... Bottom line - 17.7 billions in losses...

Retained Losses increased to 36.7 billions, was only 19 billions the previous year.

The inflection point you are talking about, is that from TA?

The Graham number (or Benjamin Graham's number) measures a stock's fundamental value by taking into account the company's earnings per share (EPS) and book value per share (BVPS).

The Graham number is the upper bound of the price range that a defensive investor should pay for the stock.

Sqrt(22.5 * EPS * BVPS)

According to Graham, Zenith at anywhere below 84 Naira is a buy. Is it true?

RabbiDoracle:
Sometimes yes, many times No.

Example

Zenith bank

2017 YE was reported in early 2018.

So let's look at these earnings.

2016
PBT 156B PAT 129B

2017
PBT 203B PAT 177B
interim, final dividends : 0.25 and 2.45

2018
PBT 231B PAT 193B
interim, final dividends : 0.3 and 2.50

2019
PBT 243B PAT 208B
interim, final dividends : 0.3 and 2.50

Remember 2019 YE was reported in early 2020

This is a beat!

Yet Zenith stock price fell from N32. 65 in February 2018 to N10.70 in March 2020. This was a 67% uninterrupted decline in price even when earnings were stellar and dividends increased.

At inflection point, irrespective of fundamentals things change.

Let's look at another example, FIDSON!

In 2015, it peaked at around 3 Naira.
In 2017, it crashed to 93 kobo.
In 2018, it peaked again to 6 Naira.
In 2020, it crashed to 2 Naira, 45 kobo.
Currently, it is at 9 Naira, 85 kobo


Tell me you could have estimated/guessed how far up or down at these points.

RabbiDoracle:
At bottom inflection point, prices change (start to rise) even when fundamentals are still bad. So you see that the earnings lag price movements.

Likewise at the top inflection point, prices change(start to fall) when the fundamentals are still perfect. So when the earnings are released, it confirms the trend.

So that inflection point looks like a constant which is determinable.

Your explanation is similar to the way I understand the market.

Here is my view:

Their are two teams - the buyers team and the sellers team. Each team has 2 subteams.

The buyers:
B1, they want to buy as low as possible, you can also call them bargain hunters.
B2, they are ready to buy for higher if pushed.

The sellers:
S1, they want to sell as high as possible, you can also call them bargain hunters.
S2, they are ready to sell for lower if pushed.

Note that both buyers and sellers have a price range in mind based on the information they have, consciously or subconsciously.

As price moves up B2 dries up and S2 starts overshadowing S1. B1 gains upperhand until S2 dries up and the situation reverse.

Now, as price moves lower S2 dries up and B2 starts overshadowing B1. S1 gains upperhand until B2 dries up and the situation reverse once more.

How far each group will go depends on many factors, some of which are:
*Information asymmetry
*Macro and Micro economics
*luck
*Number of buyers/sellers available at a given time etc

yMcy56:
TRANSCORP
Tony's ally are stepping in small small.........
Quite some Director's dealings, which most likely includes his family members........
Toby Elumelu, Elumelu Ogochukwu, etc.
Reason for the aggressive accumulation witnessed on Friday I think.

https://doclib.ngxgroup.com/Financial_NewsDocs/170_Notification_of_Share_Dealing_(Elumelu_Onyekachukwu).pdf
https://doclib.ngxgroup.com/Financial_NewsDocs/170_Notification_of_Share_Dealing_(Elumelu_Ogochukwu).pdf
https://doclib.ngxgroup.com/Financial_NewsDocs/170_Notification_of_Share_Dealing_(Elumelu_Onyinye).pdf

Talking of aggressive accumulation, some people are accumulating Oando, despite no financial statements to work with. I see 30 to 40% increase from CP in a few months time or even sooner. Mr Loco mentioned it too.

RabbiDoracle:
After the 10% rise in that month, what next? Hold, sell or buy more?

You seem to be interested in data based research. Good one.

Try finding solutions to :

- (1) why price rise to a point (or price band) and then stops.
-(2) why price falls to a point ( or price band) and then stops.
- (3) why when this (either of the two points mentioned above) are happening, an event (news, catalyst) occurs afterwards to propel (up or down) the price enforcing a trend.

This will help you know the max/min possible price an asset can get to before it hits inflection point.

*Stocks go up and down in response to changes in perception of a company’s ability to generate earnings and pay dividends

*Changes in perception can arise from developments within the company, in the company’s competitive environment, or in the economy in general.

How far in any direction is beyond my scope, I need to learn some more.

yMcy56:
As for respect, me oooo, I don't demand respect from people......but guess my personality does. Anyone fit pocket im respect, me no need am, na money I need as you dey see me so. E se pupo.

Lol, you hardly get annoyed except for one time in 2020, me self surprise...

Mcy56:
Don't let me and you start our own here o.
I know your type and i think I've respected you enough. You can shove your pride in you a.n.u.s and get the fvk out of the matter.
Common sense is not common after all.

Enyinne really pressed ur buttons.

RabbiDoracle:
Pork, Beef, Eggs, Poultry and their corresponding animal feeds.

The chart of these (lean Hog futures, Live cattle futures) could rise uncontrollably. So if you have these protein sources as a farm, guard it well. Boys could be moving around

In addition, the chart of Lead (a metal) will need to spike higher.

Why should Lead (symbol Pb) rise?

Lead is used for making car batteries, ammos, used in electrical sector and also used for protection against radiation. The first 3 uses didn't cause a spike in the metal, so what seems to be in the shadow.

Could an uncontrollable rise of Lead be due to a risk of a nuclear attack on any place? Recently there has been talk of nuclear strike in this ongoing war between Russia and Ukraine. Will there be a real use case or any accident involving nuclear arsenals?

The world has changed forever.

I think a nuclear fallout is unlikely, except the payload is so large that you obliterate your enemy without reprisal attacks. As long as there is a chance of reprisal, they ain't going to do it.

The people at d top act and speak all tough but deep inside they care toomuch about the things they luv...

From observations I see FCMB and PRESCO delivering over 10% from current price by the end of the month. I see UBN and NESTLE decline.

My view are based on simple stats and a few axioms.

Axiom1: High Volume no significant change in price - someone or a bunch of someone's have info and d stuck will most likely go up.

Axiom2: High Volume and "significant" upwards change in price - "Everyone" wants to get in, information is openly available.

Axiom3: High Volume and "significant" downward change in price - "Everyone" wants to get out, information is openly available.

Statistics: I collected the daily volumes for every month since 2020 and matched the sum of d first N days to current month total N days. The stocks I highlighted above have shown considerable difference in volume compared to the other previous months.

Conclusion: Presco(Note that presco already has 18% in just 3 days) and FCMB are my 2 bets with a minimum 10% upward move each.

This is not an investment advice o, just playing with numbers.

.