₦airaland Forum

Godlylifeoneart:
@GonFreecss1
This is the message I have been preaching on dz forum. traders have misled investors by incorporating the Concepts of TA and FA which does not reflect the true status of >60% of listed companies in NSE.
Who can tell us the true capital inflows of 50% of the listed companies? Many of the companies declared money realized from assets sales as profit, dz builds up the inflow and subsequent alter the true PE ratio, and dz mislead investors in anticipating higher growth for the affected companies.
If it were not the Nigeria factors, A company like sky bank should have had PE ratio of zero before the suspension (medicine after death)
A bank like diamond should have a zero PE
The bank is now on a mission to sell assets and declare the proceeds as profits to investors.
NSE has defiled all known fundamental principles of investing and financial independence.
In my view, winners don't quit, quitters don't win either.
The way out is to ignore all the emotional and confusing analysis by the so called Wisemen that know everything about NSE.
Keep investing in companies that are well structured (management)
Companies that have the interest of minority shareholders. Such institutions will deliver at the long horizon.

bigjay01:
... and someone is bidding @75k
tomorrow they'll start telling stories that touch

Yayira:
I want to ask you a question on the bold PLEASE it’s just a question oo.. I’m still learning..

Where was money used in purchasing an asset gotten from ?
Do you know how much it was bought?
Think you need to first find out if the money used in buying such asset was taken from a profit that was declared.. if not then they have every right to consider it a profit after selling.
And btw they’ve got to be a profit from the sells of any asset which should be declared.
Take diamond bank for example, such asset in such country can’t be sold at loss.. whatever was made on it should be declared..

Just Incase i no make sense lol ignore this post all together..

GonFreecss1:
Thank you very much. I used to think people in the cryptocurrency world are pure speculators, but coming here has shown me that speculators are everywhere. Of what use is TA, if an announcement or rumour about a company good or bad news comes out? How will TA help?

If a company is making money or a good business, I don't care how bad things want to get in the stock market, it's the smart thing to buy more.

I mean does it make sense? A company averages 50Kobo EPS when it was 2 naira. Then it becomes 1 naira, and still maintains the 50Kobo EPS. Lol! Of course I would fucking buy more if the other metrics are okay.

I will say this again, perspective is your friend. If land was sold like stocks on a screen, people would behave the same way they behave with stocks. Emotion, especially fear is a very funny thing. Greed and elation is another funny one. Lol, everyone quotes the Warren Buffet stuff like it's easy. (Be greedy when others are fearful and be fearful when others are greedy), but the truth is it is easier said than done. The problem is many of you invest your whole life savings. How will you sleep well when you do that? The best time to have invested was in that 2016/2017 period, beginning of this year was a bad time. This same thing happened in the cryptocurrency world, they kept warning people, but they never listened.

The truth of the matter is people are more comfortable investing their money when everything is going up, but get scared and sell when everything is going down. Typical buy high, sell low.

Forget all the TA stuff. People who make money here are the emotionally balanced people. Not people who react to fear or greed, or people who follow the crowd or trend. You will never make money doing what everyone else is doing.

There is a reason Warren Buffett is one of the richest guys out there. He was not a trader, he is an investor. Has he made mistakes? Yes, but he has consistently beat the market overall.

Mpeace:
Suspension on Unity bank lifted. https://nairametrics.com/nse-lifts-suspension-on-unity-bank-following-release-of-tesults/

Deadlytruth:
Could you kindly explain how you yourself would ever make profit in the stock market if everyone does these two things you accused them of failing to do at the two bolded?

I am sincerely interested in the explanation because we seem to be fast approaching the era where everyone will start following these two pieces of advice very strictly and a lot of us will just have to go back to the village.
Please do explain. Thanks.

bigjay01:
... and someone is bidding @75k
tomorrow they'll start telling stories that touch

GonFreecss1:
It's simple. And I will use an analogy story.

So I had been in the cryptocurrency world for a while, I entered after the last Bitcoin crash. Things were kinda slow and sideways for a while, then before we knew what was happening, ICO's (Initial coin offering almost like IPO's) came, money started flowing in fast. There were Airdrops (free crypto) etc, and I noticed more people started coming in. CNBC and all news channel were talking about cryptocurrencies. Before we could blink Bitcoin moved from 1K to 5k to 10k to 15K and then to 19K. I sold from 10K through 18K. Because to mine 1 bitcoin was an average of 6K, 18K for 1 BTC was not justified. Anyway, I looked at the history of cryptocurrencies, it was the same thing after euphoria and massive greed came the drought of the bear markets. First was the denial that it will keep going down in price, then there was the panic after a flash crash, then talks of Bitcoin is dead comes up, then massive fear, then multiple bounces and now sideways movements, which I suspect will go on for a while... before another bull market.

You might think I just described only the cryptocurrency world, but I just described the NSE 2016/2017 in perspective. This 2018/2019 ending might be the same thing, we are not sure, but what I know is this... when people are scared... you will see it when people are greedy you will see it. The problem is that it's hard to go against the trend. It's emotionally difficult.

Some people bragging about Bonanza will still crumble and sell when prices keep dropping. Don't catch a dropping knife they say, my question is no one knows when anything will be a dropping knife.

My strategy has always been simple, invest little amounts gradually during drops below what I feel is the intrinsic value of an asset.

Trust me there is a high chance it will keep dropping, that's none of your business. So far the business in question is a good business and is making money you believe is in line with it's intrinsic value, assets and debts inclusive... well you will be unto something.

It's not easy but investing can be that easy. The problem is many people over analyze, speculate and do unnecessary graph readings and mathematics. Makes me laugh all the time. That's time you would have spent making more money via a job or chilling with your girl, family, friends, going to the gym, sleeping or doing other things.


To summarize...

1. Investing should be simple, but it's not easy, meaning I have told you the process which sounds simple but it's not easy to implement.

2. Keep your emotions at bay. Do not follow the trends or what everyone is doing.

3. Most people shouting Bonanza will still panic and sell. That just shows that people have a limit. Even me. I have a limit that's why I invest in little chunks slowly.

4. Always think of the land perspective. If lands were sold like stocks on a computer screen, the market will act the same way as the stock market. I see the same thing in the cryptocurrency markets.

5. Always have emergency money to invest. Do not underestimate the power of a liquid money market fund.

6. Remember why you are investing. It's very easy to forget and see just numbers, but remembering those numbers means you own so and so amount of said business really helps.

DeRuggedProf:

Those whose village People have developed immunity to VCV (VeeCoVee).

Agbalowomeri:
First I commend your good writing style; may be you did some journalism
Second you said everything is about perspective, I agree
Which do you think is easier; reading a graph and knowing the intrinsic value of a coy (which is what you claim you do)?: again it's perspective
I don't think it takes as much time to do a TA compared to FA; again my opinion
As long as it works for you and as long as it meets your investment objective, ride on
As for me, I need to maximise all arsenals
And I know TA has improved my efficiency significantly
Also Gut-A is not to be neglected. People were here shouting Aiico's H2 results, we know the true story. So many falsification of results going on in NSE except few companies with good corporate governance. How do we then determine the intrinsic value of a coy with false results?

DeRuggedProf:

Those whose village People have developed immunity to VCV (VeeCoVee).

Yayira:
I want to ask you a question on the bold PLEASE it’s just a question oo.. I’m still learning..

Where was money used in purchasing an asset gotten from ?
Do you know how much it was bought?
Think you need to first find out if the money used in buying such asset was taken from a profit that was declared.. if not then they have every right to consider it a profit after selling.
And btw they’ve got to be a profit from the sells of any asset which should be declared.
Take diamond bank for example, such asset in such country can’t be sold at loss.. whatever was made on it should be declared..

Just Incase i no make sense lol ignore this post all together..

Chibuking81:

Agbalowomeri:
We are enjoying January bull somewhere o

Agbalowomeri:
We are enjoying January bull somewhere o

Godlylifeoneart:
MARKETS ARE DRIVEN BY THE EMOTIONS OF THE CROWD
If you can keep your head when all about you

Are losing theirs and blaming it on the Fed;

But make allowance for their shouting dread;

If you can wait and not be tired by waiting,

Or, surrounded by nonsense, don’t deal in nonsense,

Or, inundated [by] indicators, scoff at what they’re indicating,

And cherish the thought that uncertainty is immense;

If you can fill the unforgiving minute

With sixty seconds’ worth of resolve right to the end —

Yours is the market and everything that’s in it,

And – which is more – you’ll be an Investor, my friend!

– American journalist Jason Zweig, with apologies to Rudyard Kipling (inspired by his poem If, written circa 1895)
For most animals, congregating in large numbers is generally a good idea. Large numbers offer protection from adversaries. Large numbers hunt more effectively. In large groups, the strong help protect the weak. The presence of large numbers can also be a useful decision-making tool – after all, if large numbers are eating a particular foodstuff, it’s unlikely to be harmful. Being part of a crowd is a pretty good survival strategy for most animals.

In nature, voting – or collective decision-making – works. The most popular strategies, such as where to live, where to forage and what foodstuffs to eat or avoid, have most likely proven to be winning strategies. Investing is different. Over time, investments do not respond to votes. Popularity does not generally indicate success. Rather, markets are weighing machines. They take information from diverse sources, weight it all up, and come to a conclusion regarding the value of an investment on a daily basis – and then set a price for it according to that judgement.

People strive to make their world comprehensible, predictable, and rewarding, but their locus of control extends only so far. No matter who you are, what you do, or the resources you have at your disposal, you have to learn to live with uncertainty, complexity, ambiguity, and fear of the unknown. That’s the cause of our discontent: we want to be assured of the outcome before we invest.
– Josh Kaufman, author of How To Fight a Hydra
Human beings also instinctively herd together. Human beings hate uncertainty. We like knowing the ‘truth’, and being in a crowd makes us feel like we have discovered it. After all, if there are so many of us here, how can we possibly all be wrong?

In the short term, popularity can set the price of an asset. After all, if the herd decides to buy something, the price/value relationship becomes irrelevant and a higher price is generally taken to be a good sign – it denotes widespread acceptance. And the herd is always right, right?

The problem with this is that the real outcome of our investment decisions is ultimately not determined by what the crowd thinks or says. Rather, the outcome is determined by the difference between the price paid for an asset, and all the future cash flows you will receive in return. In other words, it’s value. So the crowd can set the price of an investment, but once we have bought and paid for the investment, it is the underlying value that will determine the outcome.

If we accept that there is a difference between how prices are determined and what comprises the actual value of an investment, we can then think more clearly about what the determinants of a successful investment decision might be.

Firstly, the cash flows of most assets are reasonably stable. Think about renting out a property. There might be the odd vacancy where no rent is received, but over a cycle rental income is fairly predictable – and not hugely variable. Company earnings might be a bit more volatile, but have a similar pattern. And if the cash flows are fairly stable, it follows that their present value must also be reasonably stable.

What is not stable is the share price, or the crowd’s estimate of the value. More precisely, in the short term, markets are driven by the emotions of the crowds. And emotional crowds are not very rational. It is this ‘irrationality’ that causes share prices to diverge – often significantly – from the value of the investment, on both the upside and the downside.

Good investment opportunities are created when share prices are below the values of the assets.

This leaves us with an interesting conundrum. To be a successful human being, one is well-advised to stick with the crowd. It is safer and smarter. But to be a successful investor one often has to stay away from the crowd, or act differently to the crowd. When the crowd is negative, driving the prices of assets down, it can be a good buying opportunity. Conversely, when the crowd is positive, driving the prices of assets up, it can be a good selling opportunity.

Of course the best buying and selling opportunities don’t come around all that often.

Great investing requires a lot of delayed gratification. It’s waiting that helps you as an investor, and a lot of people just can’t stand to wait. If you didn’t get the deferred-gratification gene, you’ve got to work very hard to overcome that.
– Charlie Munger, vice chair of Berkshire Hathaway
The market is filled with information that ultimately doesn’t directly impact the underlying valuations of companies. We all quite enjoy discussing the latest GDP or inflation numbers, complaining about the most recent political faux pas, or even analysing arcane numbers like US non-farm payrolls (what is that, even?). But does this really assist us in making better investment decisions?

These ‘talking points’ all effectively amount to one thing: noise. We may feel that trying to wrap our heads around them reduces uncertainty, but all this amounts to is a false sense of comfort. They are all thinly veiled attempts to forecast or anticipate the future, which is unknowable and impossible to determine. The fact that this truth makes us human beings uncomfortable does not make it any less true.

Instead of speculating about what the future may look like – something that is unduly stressful because it is so hard – surely it makes sense to focus on the things we know to be true already? Things like currencies depreciating in line with inflation differentials over time, economies growing at low single digits above inflation over time, earnings growth of companies being quite closely linked to economic growth over time, equity returns being closely linked to the long-term earnings growth of companies. Instead of focusing on the variation of share prices, which is extremely hard to anticipate, we should focus on the things we know to be fairly stable – and use oscillating share prices as an opportunity to capitalise on this knowledge.

If that sounds simple, it is.

It is not our inability to understand what we need to do that gets us into trouble, it is our inability to implement Munger’s concept of delayed gratification. The difficult thing is to do nothing while we wait for these inevitable opportunities.

I spend about half of my time wondering why I have so much in stocks, and about half wondering why I have so little.
– Jack Bogle, founder and retired CEO of Vanguard
The fact is, no one knows what the future holds. But allocating assets in a sensible way more often means investing away from the crowd, being patient, not having unrealistic expectations and not letting market noise distract or upset you. If you stick to these principles, you have the formula for a successful strategy to get through volatile and uncertain times. Of course, in the short term, it might feel like you are incorrectly positioned for what is going on in the market – take comfort that even Jack Bogle feels uncomfortable most of the time! But a sensible strategy will work out just fine
culled from cnbc... Modified by me

Samuelojonla123:
Hello everyone am new here and want to more about stocks buying, I currently have 50k with me but don't know which broker I could go into. Please anyone should enlighten me more on this.

Godlylifeoneart:
@Yayira... Remember the fundamental principles that guide trade and investment decisions.
We are all running a race to Financial independence by participating in this forum.
To the best of my understanding, it's a crime in some countries for a listed company to declare profits realized from assets as capital inflows, mind you, asset is not a recurring source of income, in a true PE ratio calculation the capital inflows in the last 12 months should be used to calculate the PE value. Profit from asset sales is usually declared as special dividends for investors. Remember, this is one of the major problems we are battling in Nigeria. Fraudulent auditing, doctored reports after corporate mismanagement, exaggerated price of asset.
I will make a reference to diamond Bank... The bank has been using the assets they are about to dispose to defend its capital to risk assets ratio to make the bank looks healthy at the regulatory authority, now assets are gone (non recurring source of income) Money realized declared as profit to cover gross mismanagement that is synonymous with the bank under dozie et al
The assets belong to investors and should be a special dividends, the performance of the bank can now be measured in the core banking biz, we can now compare them with other tier 2 or 3 banks.
Investors can then decide the intrinsic FA and TA of the bank.
Finally, the incorporation of profits from. Asset masked the true PE ratio (for investors) and capital risk adequacy ratio(CBN)

Chibuking81:
Bonanza period approaching

Agbalowomeri:
We are enjoying January bull somewhere o

BullBearMkt:
...technically:

FCMB: has good support at 1.47 & if that fails, then there is another good support at 1.30
ETI: has good support at 16 otherwise 14

A good buy? I don't know...I'm waiting for NSE index on monthly to find its bottom as any rally could be short-lived