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<\/p>\nIf you\u2019d like to buy shares in Nigeria, there are a few things you need to know. In this post, you\u2019ll find out the basic of buying shares from the agency that regulates the process to stockbroking firms involved.<\/p>\n
Let\u2019s start right away.<\/p>\n
Generally, companies list their shares on the Nigerian Stock Exchange (NSE). The NSE was founded in 1960 and it is licensed under the Investments and Securities Act (ISA).<\/p>\n
The NSE is regulated by the Securities and Exchange Commission (SEC) of Nigeria.\u00a0NSE offers listing and trading services, licensing services, market data solutions, ancillary technology services and more.<\/p>\n
As of March 2018, there were 176 companies listed on the NSE and their combined market capitalisation was about \u20a68.5 trillion.<\/p>\n
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When buying shares, the first step to take is to do your research and find the shares you\u2019re willing to buy then contact your preferred stockbroker and submit a trade order via email.<\/p>\n
Your broker will respond by executing your trade and sending you a contract note that specifies the buy or sell price, commissions, and fees.<\/p>\n
Currently, there are 327 brokers licensed to trade on the Nigerian Stock Exchange. Just in case you\u2019re wondering who they are, below is a comprehensive list:<\/p>\n
The minimum initial deposit range between N50,000 to N1,000,000 depending on the stock-broking firm<\/p>\n
In terms of commissions and fees, these are evaluated on a sliding scale that is standard across all brokers. For instance, if your transactions is less than N1,000,000 (roughly $6,350.00) you will pay 1.86% when buying shares and 2.19% when selling one.<\/p>\n
For larger transactions, commissions and fees total 1.49% of the total transaction value to buy and 1.82% of the total transaction value to sell.<\/p>\n
Below are the steps involved in buying shares<\/p>\n
Step 1: Complete the CSCS Account Opening Form<\/strong><\/p>\n The Central Securities Clearing System (CSCS) records the ownership of Nigerian securities via electronic accounts.<\/p>\n Usually, when you request a broker to open a trading account, you will be sent a copy of the CSCS Account Opening Form. You will then be assigned a CSCS account number. This number will accompany every Nigerian stock trade you execute, allowing the CSCS to keep record of all your holdings in the country.<\/p>\n Step 2: Complete the Broker\u2019s Account Opening Form<\/strong><\/p>\n After receiving your CSCS account number, you will also fill your account opening form. You can request for sample forms from your selected broker in order to fill the form correctly. Some of the information, you\u2019re expected to fill include your ID number, address, and banking details.<\/p>\n Step 3: Get two color passport-sized photos of yourself<\/strong><\/p>\n Step 4: Photocopy the following documents<\/strong><\/p>\n Step 5: Send the original CSCS form, account opening form, passport photos and the photocopied documents to your broker<\/strong><\/p>\n You can use any suitable and reliable courier service to achieve this. Also, you can send the photocopies of all the documents via email but you must send the original documents as well.<\/p>\n Step 6: Deposit the funds in your brokerage account<\/strong><\/p>\n Once your broker provides you with the necessary bank details, you can transfer the necessary funds to the account. You can take your broker\u2019s bank details to your local bank branch and let them assist you with the process.<\/p>\n Usually, the settlement of shares trade takes four business days on the Nigerian Stock Exchange.<\/p>\n Anytime you want to collect the dividend of your shares, all you need to do is write to your broker indicating that you want all dividends paid on your holdings to be deposited directly into your trading account.<\/p>\n","protected":false},"excerpt":{"rendered":" If you\u2019d like to buy shares in Nigeria, there are a few things you need to know. In this post, … <\/p>\n\n