BANKING

Top 10 Invaluable Tips for First-Time Investors

Published

1 year ago

Top 10 Invaluable Tips for First-Time Investors

For most successful investors, investing is an exciting and rewarding journey. However, for first-time investors, it can also be daunting and unfamiliar territory. Having a solid understanding and a well-thought-out strategy is crucial to achieving success as an investor.

Whether you’re considering investing in stocks, bonds, real estate, or any other asset class, these tips will help you navigate the exciting but uncertain world of investing.

10 Tips for First-Time Investors

1. Have a Clear Plan

Investing is a game; anyone who goes into it without a clear plan for winning will most likely be disgraced out of it. The moment you decide to go into investing, you must start laying out your goals and strategies to achieve them. You must ask the vital questions: “What am I investing in? How much am I putting in? What do I intend to achieve at the end? What do I do if things don’t go as planned?”

Before you start investing, ensure you have clear answers to these questions. A clear and concise plan ensures you go into the game well-prepared, irrespective of your experience level.

2. Understand Investment Risks

Investing involves risks; the more returns you seek, the greater the risk. The volatility of an investment determines the risks and returns involved in it. Some investments, such as stocks, have high volatility in the short term but can potentially give you higher returns in the long term. Others, like bonds, have more stability but offer much lower returns.

You must understand from the onset the levels of risk involved in your preferred investment choices and how much risk you’re willing to tolerate. Investing within your means and risk tolerance will ensure you make profitable investment decisions most of the time.

3. Invest in Assets You Understand

You must ensure not to put your money in any asset you don’t understand. Many investment options have promises of unsustainable returns and no use cases. These investments often appeal to new investors who do not know how to do their due diligence before committing their resources.

Therefore, you must learn about the different investment options available to ensure you do not follow the get-rich-quick bandwagon. If you want to invest in stocks, bonds, mutual funds, or real estate, ensure you understand the risks and potential returns involved.

4. Start Small and Gradually Increase

Plunging into an investment with all your resources as a first-time investor is risky. It’s important to start small, maybe with 10% of your budgeted capital, and gradually increase your investment as you gain confidence and knowledge. The idea is, to begin with what you can afford to risk and increase it as you gain experience. Building confidence is key to your success as an investor, as you’ll learn to avoid making uninformed decisions due to trends or other people’s opinions.

One key benefit of starting with what you can afford to lose is that it allows you to make mistakes and learn from them without hurting your entire capital.

5. Diversification is Essential

One of the most important pieces of advice you’ll hear from pro investors is not to put all your eggs in one basket. Diversification is key to your success, as it reduces your risk exposure by spreading your investments across different asset classes and industries.

Oftentimes, age and risk savviness determine your investment diversification ratio. Younger investors invest in riskier assets like stocks, whereas older investors go for safer investments like bonds, Treasury bills, and ETFs.

While you learn to diversify your investments across asset classes and industries, you must also learn to diversify within asset classes. This ensures your entire fund is not affected when an economic downturn hits a particular asset.

6. Manage Your Emotions

Emotion is a bad driver of investment decisions, as it often leads to impulsive choices that could harm your portfolio.

Fear and greed are two emotions you should get rid of as a first-time investor. Sometimes, the market will go against your analysis and expectations in the short term. If you’re not confident enough at this stage, you’ll let fear take over, forcing you to sell at a loss or with little profit. Similarly, when the markets are going according to your plans, overconfidence or greed could lead you to exceed your risk tolerance level, resulting in unfavorable outcomes.

To make successful investment decisions, you must remove emotions and let your budget, strategy, and goals guide your decisions.

7. Have a Long term Investment Mindset

Investing is a marathon, not a sprint. The significant returns come from long-term investments, which are the proceeds of compounded short-term investments. By allowing your capital and its interests to compound over a long period, you can make more returns.

An important reason you should think long-term when investing is the difficulty in making profitable decisions with short-term fluctuations. Various factors, such as economic events, investor sentiments, influencer opinions, or political affairs, often drive short-term fluctuations. Making investment decisions based on these factors will typically result in inconsistent and unfavorable returns. However, by making long-term investments, you have a better chance of riding out these short-term fluctuations and benefiting from the overall upward trajectory of the market.

8. Double-check Trendy Investments

One of the most invaluable tips you’ll get as a first-time investor is to double-check trendy investments. They often come with promises of mouthwatering returns in the shortest possible time, and if you’re not careful, your resources will move with them as they phase out quickly.

You must understand that the most popular investment opportunities aren’t always profitable. Some investments get popular due to hype and endorsements from celebrities and influencers, but when you look at them, you’ll see why they’re not the right ones for you.

9. Stick to One Strategy

Many first-time investors make the mistake of applying many strategies at once without taking the time to master one. All investment strategies have their strengths and weaknesses. Therefore, if you keep jumping strategies, you might confuse yourself at the end.

However, if you put your efforts into becoming proficient in one strategy, you’ll start making consistent positive returns over time.

10. Seek professional advice if needed

Investing can be confusing and overwhelming, especially for first-time investors. When things get to the point where you are completely unsure of the next step to take, consider consulting a professional for guidance. A good professional can take you by the hand, help you create a solid investment plan, and ensure you’re always on track toward achieving your investment goals.

Conclusion

Like every other profession, investing requires knowing the ropes before venturing into it. In addition to knowing the ropes, you must nurture the right mindset and get yourself emotionally ready to navigate the exciting but uncertain world of investing. Hopefully, you’ll get insights from the tips listed here and establish yourself as one of the most successful investors in Nigeria and beyond.

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BANKING

Afreximbank Acts as Joint Lead Manager on Ecobank Transnational Incorporated’s USD 400mn Senior Unsecured Note Issuance

Published

2 months ago

Christopher

The proceeds of the note will fund general corporate purposes of the issuer, including refinancing of a USD350 million senior bridge-to-bond loan facility that was jointly coordinated by Afreximbank in March 2024.

African Export-Import Bank (“Afreximbank”) (www.Afreximbank.com) is pleased to announce that it has successfully acted as Joint Lead Manager and Bookrunner on a USD 400 million 10.125% Rule 144a/RegS senior unsecured note issuance by Ecobank Transnational Incorporated (“ETI”) due in October 2029.

The note issuance achieved peak orderbook oversubscription of 2.1x, backed by more than 70 high-quality and diverse investors comprising development finance institutions, asset managers, commercial banks and insurance companies from Africa, the UK, USA, Europe and the Middle East.

Professor Benedict Oramah, President and Chairman of the Board of Directors of Afreximbank, commenting on the transaction, said: “We are pleased to have supported Ecobank Transnational Incorporated (“ETI”) in placing the first public Eurobond issuance by any Sub-Saharan African financial institution since 2021, following our bridge financing support earlier in the year. This transaction underscores Afreximbank’s capacity and readiness to structure innovative market access solutions for our pan-African banking partners.”

Afreximbank’s Advisory and Capital Markets (ACMA) department acted as Joint Lead Manager and Bookrunner on the issuance, working alongside international and African partners.

Distributed by APO Group on behalf of Afreximbank.

BANKING

International Islamic Trade Finance Corporation (ITFC) and the Central Bank of Nigeria Successfully

Published

2 months ago

Christopher

International Islamic Trade Finance Corporation (ITFC) and the Central Bank of Nigeria Successfully

These workshops form part of ITFC’s Integrated Trade Solutions (ITS) framework, aligning with the organization’s goal of providing holistic trade financing interventions in OIC member countries.

The International Islamic Trade Finance Corporation (ITFC) (www.ITFC-idb.org), a member of the Islamic Development Bank (IsDB) Group, in partnership with the Central Bank of Nigeria (CBN), successfully concluded a workshop on Non-Interest Banking and Trade Finance in Nigeria. Held from 17th to 19th September 2024 in Abuja, the sessions aimed to enhance capacity and knowledge in Islamic banking principles, trade finance products and services, and how different financial toolkits are applied in Islamic finance from operational and business perspectives.

International Islamic Trade Finance Corporation (ITFC) and the Central Bank of Nigeria Successfully

Nigeria’s Islamic finance industry, valued at US$3.8 billion, is one of the major Shariah compliant industries in Africa. Despite some challenges such as low public awareness and a smaller capital base compared to conventional banks, Islamic finance has been substantially contributing to reduce financial exclusion and improve access to affordable finance in the country. The three-day workshop was designed to bridge prevailing knowledge gaps focusing on key areas such as Sukuk issuance and main non-interest banking products basics.

Delivered under ITFC’s Integrated Trade Solutions framework, the workshop equipped professionals with the skills to promote Islamic finance in Nigeria while also highlighting ITFC’s wide range of trade financing services.

Participants reported a significant boost in understanding Islamic banking and trade finance, and the workshop showcased ITFC’s contributions to economic development through sustainable financial solutions.

Eng. Nasser Al Thakair, ITFC, remarked: “ITFC is committed to supporting Nigeria’s efforts in Islamic finance, tailoring this workshop to address the unique challenges faced. We will continue to provide the expertise and financial backing needed to grow Islamic finance in Nigeria and beyond.”

Over 30 professionals from the Central Bank of Nigeria, non-interest banks, and other financial institutions attended, further advancing Islamic finance in the country.

As Nigeria positions itself as a leading market for Islamic finance in Africa, ITFC remains dedicated to advancing trade finance and supporting the growth of the sector for long-term economic impact.

Distributed by APO Group on behalf of International Islamic Trade Finance Corporation (ITFC).

About the International Islamic Trade and Finance Corporation (ITFC):

The International Islamic Trade Finance Corporation (ITFC) is a member of the Islamic Development Bank (IsDB) Group. It was established with the primary objective of advancing trade among OIC member countries, which would ultimately contribute to the overarching goal of improving the socioeconomic conditions of the people across the world. Commencing operations in January 2008, ITFC has provided over US$75 billion of financing to OIC member countries, making it the leading provider of trade solutions for these member countries’ needs. With a mission to become a catalyst for trade development for OIC member countries and beyond, the Corporation helps entities in member countries gain better access to trade finance and provides them with the necessary trade-related capacity-building tools, which would enable them to successfully compete in the global market.

FINTECH

Kazang Pay launches card acquiring service in Zambia

Published

2 months ago

Christopher

Kazang (www.Kazang.com), the prepaid value-added services (VAS) and card acquiring business within JSE-listed fintech Lesaka Technologies, has launched its Kazang Pay card acceptance solution for merchants in Zambia. Kazang Pay makes it affordable for merchants to accept card payments on the same Kazang terminal they use to sell prepaid products and services.

Kazang Pay launches card acquiring service in Zambia

The Kazang Pay enabled terminal in Zambia accepts VISA debit and credit cards as well as mobile wallet payments. Payments are settled to the merchant’s Kazang wallet on the same day. It’s as easy as letting the customer tap or insert their bank card and enter their PIN on the secure scramble PIN pad.

Kazang operates around 12,000 VAS terminals in Zambia. The goal is to enable the majority to accept card payments over the next six months. Benefits to merchants include low transaction fees and no monthly terminal rental fee for those that meet a modest monthly transaction threshold as well as the opportunity to grow their business through card acceptance.

Kazang is Zambia’s largest VAS point-of-sale terminal provider, enabling mobile money payments, bank and mobile money cash in and out, bill payments, airtime, Zesco, and many other prepaid services on one platform. The addition of card acceptance makes the platform even more comprehensive for merchants and consumers alike.

The launch of Kazang Pay in Zambia follows the introduction of the solution in South Africa, where around 60,000 small and micro merchants use Kazang Pay to accept card payments. In Zambia, there are around 3.8 million debit, credit and ATM cards in issue and 41,000 point of sale (POS) terminals in place. The value of POS transactions has grown to K 111.4 billion by 2022 from less than K 20 billion in 2018, according to the Bank of Zambia.

Says Leon de Wit, managing director at Kazang Zambia: “Zambia has made enormous strides in terms of financial inclusion, with card usage and penetration growing at a rapid pace. With Kazang Pay, merchants can now easily accept card payments on the same all-in-one terminal they already use for vending of VAS products.

“Card transactions help merchants to grow basket sizes and potentially attract more customers, and at the same time, reduce the risks and costs of handling cash. Moving towards digitalised payments will also enable merchants to track sales, manage cash flow, and create a footprint that could make it easier for them to access loans.”

Ashley Naidoo, director of Kazang Pay in South Africa says: “Our Zambian merchants have eagerly embraced our card acquiring service as a valuable part of our one-stop solution. Following the launch of Kazang Pay in Zambia, we have seen higher VAS sales across our merchant base and much-improved merchant retention and with our card acquiring solution we now appeal to a broader merchant base.”

Distributed by APO Group on behalf of Kazang.

ABOUT KAZANG:
Kazang (www.Kazang.com) is a leading provider of cash and digital solutions to merchants in Southern Africa’s informal economies. Our fintech solutions include a diverse range of value-added services (VAS), card acquiring, secure cash vaults and supplier payments platforms. Operating with a network of approximately 90,000 active devices, we process approximately 2.2 million transactions daily in markets such as South Africa, Namibia, Botswana, and Zambia.

We are dedicated to helping small and medium merchants grow and succeed, through increasing their sales, making their businesses more efficient and reducing their risks with its holistic portfolio of products and services. Kazang is a member of Lesaka Technologies (https://LesakaTech.com).

ABOUT LESAKA TECHNOLOGIES, INC:
The Connect Group and Kazang was acquired by Lesaka Technologies, Inc. in April 2022. Lesaka Technologies, (Lesaka™) is a South African Fintech company that utilizes its proprietary banking and payment technologies to deliver superior financial services solutions to merchants (B2B) and consumers (B2C) in Southern Africa. Lesaka’s mission is to drive true financial inclusion for both merchant and consumer markets through offering affordable financial services to previously underserved sectors of the economy. Lesaka offers cash management solutions, growth capital, card acquiring, bill payment technologies and value-added services to retail merchants as well as banking, lending, and insurance solutions to consumers across Southern Africa.

Lesaka has a primary listing on NASDAQ (NasdaqGS: LSAK) and a secondary listing on the Johannesburg Stock Exchange (JSE: LSK). Visit www.LesakaTech.com for additional information about Lesaka Technologies (Lesaka ™). $LSK / $LSAK