Some financial analysts in the nation’s capital market have advised investors to diversify their portfolio investment in the capital market.
A stockbroker and a fund manager, Mr. Magnus Uchenna, said a more traditional way to minimise risk when investing is to diversify the portfolio.
“Individual investors often tend to be carried away by a particular stock or investment that has performed well in the past. Past performance is not necessarily a predictor of future performance. When investing, measuring future performance should be purely based on merit.
“Investors should avoid concentrating all their money on a particular investment because it has done well in the past. Diversifying your investments across different stocks, bonds or funds helps in reducing your risk,” he said.
A risk management analyst, Mr. Bolaji Akinola, also explained that it is important that as a retail or individual investor, one should understand the investment options that are open in the capital market.
“Do you want to invest in equities or bonds? Would you prefer index tracked funds, mutual funds or Exchange Traded Funds? Understanding all your investment options and the risks and potential returns that come with each option would help you in making a more informed decision.”
Meanwhile, the total turnover of 5.011 billion shares worth N45.816 billion in 44,569 deals was traded last week by investors on the floor of the Exchange in contrast to a total of 5.021 billion shares valued at N68.974 billion that exchanged hands last week in 41,542 deals.
The Financial Services Industry (measured by volume) led the activity chart with 3.672 billion shares valued at N29.946 billion traded in 28,608 deals; thus contributing 73.29 per cent and 65.36 per cent to the total equity turnover volume and value respectively.
The Conglomerates Industry followed with 864.180 million shares worth N2.440 billion in 2,561 deals. The third place was occupied by Consumer Goods Industry with a turnover of 210.994 million shares worth N7.731billion in 7,336 deals.
Trading in the Top Three Equities namely–Transnational Corporation of Nigeria Plc, Diamond Bank Plc and FCMB Group Plc (measured by volume) accounted for 1.751 billion shares worth N5.023 billion in 6,131 deals, contributing 34.93 per cent and 10.96 per cent to the total equity turnover volume and value respectively.
Also, traded during the week were a total of 1.947 million units of Exchange Traded Products valued at N105.567 million executed in 15 deals, compared with a total of 777,535 units valued at N7.689 million that was transacted last week in 15 deals.
A total of 4,437 units of Federal Government Bonds valued at N4.260 million were traded this week in 9 deals, compared with a total of 6,301 units valued at N6.298 million transacted last week in12 deals.
The NSE All-Share Index and Market Capitalisation appreciated by 5.11 per cent to close the week at 45,092.83 and N16.154trillion
respectively.
