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Expert Urges Investors To Leverage On Low Stock Prices

Ololade Julianah

A financial expert, Mr Mike Eze, has called on investors in the nation’s capital market to leverage on the current low prices of stocks present investors opportunity to respond to experts’ advice and invest in the market despite recurrent losses in the recent time.

Eze, Managing Director Crane Securities Limited, called on domestic investors in the nation’s capital market to leverage on the current low prices of stocks for future gains.

He said the market was ripe for investment going by the current low prices of stocks, adding that this was the perfect opportunity for investors to stake their funds in the market.

His words: “This is the right time for investors to take part in the equities market, with the prices of shares at their lowest levels. Brokers are confident that the market would soon begin to stabilise and investors would begin to record significant appreciation on their investments.

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“Because with the little amount of funds you will buy large quantity of penny stocks or low price stocks, and that enhances your position as a shareholder. If such companies declare dividends, the shareholder will earn sumptuous dividend.

“In terms of capital gain if the price appreciate and you decide to sell, you will smile to the bank with big amount of funds if you invest in low price stocks, but for the high price stocks, if the price appreciate the margin will not be much and you can only recoup the capital invested,” Eze said.

The Chief Executive Officer of the Nigerian Stock Exchange (NSE), Mr. Oscar Onyema, had advised investors to take advantage of the low prices of equities and invest in the market.

“Although many anticipate volatility through the first half of the year, some stock prices are at their lowest since the May 2013 sell-off, and some are below book value, thus, presenting domestic investors with no currency risk, an opportunity for cautious long-term investing,” he said. “

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We expect that as the year progresses, with no or low levels of violence, a tighter grip on the security situation in north-eastern Nigeria, and a more certain macroeconomic outlook for oil prices, interest rates and the naira, the market’s attractiveness could improve rather significantly.”

He said that the NSE is unwavering in its commitment to solidify its leadership position as Africa’s foremost securities exchange, and is committed to initiatives that will position the bourse as an attractive listing and investment destination.