25 december 2015ogwezi nwachuku 11 investment opportunities: making your money work for you...

21 April 2023 Ogwezi Nwachuku 11

INVESTMENT OPPORTUNITIES:

Making Your Money Work For You

Presented By:OGWEZI NWACHUKU, ACA,B.SC,MBA,MIMC

0802-318-0772, [email protected]


Before we proceed:

Turn to the next person to you, tell yourselves “our lives shall never remain the same again” and shake hands with one another


Coverage….. Introduction The money making skills Investment skills

Financial market Money Market Capital Market

Choosing Investment Vehicle- the guiding principles


Coverage…..

Investment Vehicles Money Market Capital Market Others

Trading with share certificate Investment Register


Coverage……..

Other investment opportunities Imbibe the spirit Case Study/Experience Sharing


Introduction…… Warren Buffet two important rules:

(1) Never loss money, (2) Never forget rule 1. “a $1 loss today represents the loss of millions of future

dollars”. you may be losing money without knowing. The crux of this presentation is therefore to change your

consciousness towards money.

7 essential money skills


The money making skills…

If you don’t value money, you won’t make the effort to control it. If you can’t control it, you won’t be able to save it. And if you can’t save it, there won’t be any surplus to invest. If you don’t understand investing, you’ll be a less effective entrepreneur. Therefore, you won’t have any money to shield. And if you don’t have any to shield, you won’t have any to share.


Investment skills

Investment commitment of current funds in anticipation of

receiving a larger future flow of funds.

setting aside consumable income by channeling them into productive areas/assets in anticipation of earning returns in compensation for the decision to defer consumption e.g. buying shares etc.


Investment skills

Using your money to produce more money?

Are you thinking that you need a lot of money to invest? You don’t.


Financial Market

Market where long term and short term funds can be bought and sold. Money Market

Short term funds market Capital Market

Long term funds market (two sections) primary market

for new or fresh securities secondary market

for sale and purchase of existing securities


Choosing Investment Vehicle- The Guiding Principles

Safety/security Yield/Return Liquidity/Investor’s Horizon

when the investor needs his money back for other use

Marketability the ease with which an investment in the portfolio can

be disposed off.


Choosing Investment Vehicle- The Guiding Principles

Growth Diversification

Allows investments to well spread in as many sectors as possible. “Do not put your eggs in one basket”

Tax Implications Legality


Payment Systems

Insurance

MasterCard

TheFin. Market

Financial Adviser

Investment Vehicle

Investor

Tap where necessary

S D

Firewalls

Invest. Register

Investment Cloud

Developing Entrepreneurial Skills

Modeling Entrepreneurs have modeled themselves

on other successful entrepreneurs. Close identification with such entrepreneurs

as role model will lead to the acquisition of new behaviour and skills.E.g. Warren Buffet, Aliko Dangote, Bill Gate etc


Developing Entrepreneurial Skills….

Learning from experience You must be willing to learn from the experience Change with time Set definite goals and expectations.

To achieve this, you must constantly be aware of- new ways of doing things new opportunities.

You accept change and use it to motivate yourself to high level goals.


Developing Entrepreneurial Skills….

Pattern your activities with Entrepreneur in the same Business Pattern your activities after successful

entrepreneurs who are in the same kind of business or related business.

Once you understand their techniques for achieving success then use them to develop and improve upon specific aspects of your enterprise.


Developing Entrepreneurial Skills…

Be action oriented Take advantage of investment

opportunities created as a result of change in Government policies, Increases in demand, New technology, Unsatisfied preference and desires

which will lead to business success.


Developing Entrepreneurial Skills…..

SWOTHave a good understanding of your personal strengths and weaknesses and the requirements of the prospective enterprise. Highlight and use your strengths. Recognize your weaknesses, and use other resources to compensate for identified inefficiencies. Know the opportunities around you which you can tap from Beware of your competitors (threats)



Investment VehiclesMoney Market Treasury Bills

Issued by the Central Bank of Nigeria on behalf of the Federal Government of Nigeria

It is usually issued for a tender of 91 days It carries a fixed rate of interest or discount rate Under current CBN policy, investors in TBs are paid their

interest income on maturity It is issued in multiples o N1000.00 by auction system The CBN underwriters the issue as well as rediscount facilities

for them Application to investment in TBs must be routed through an

authorized dealer i.e. Banks.


Investment Vehicles….Money Market

Treasury Certificate: issued by the CBN on behalf of the Federal

Government of Nigeria It has tenors of between 1 to 2 years It is a medium term government security It can be rediscounted at the CBN if

holder cannot wait till maturity It carries fixed interest rate or discount

Investment Vehicles….

Bankers Acceptances (BAs) issued by reputable companies and

accepted by their banker. the Banker guarantees repayment of the

amount invested at maturity. have maturities o between 30 and 180 days.



Investment Vehicles

Money Market Commercial Papers

Issued by blue chip companies. Banks only serve as intermediaries. No guarantee of repayment Banks. Maturity period ranges from 180 to

270 days.

Investment Vehicles...

Fixed Deposit/Placement Tenured deposit for an agreed time

period. Negotiable Depositor suffers interest reduction

if deposit is terminated before maturity period.



Investment Vehicles... Capital Market

Development Loan Stocks Long term debt instrument issued by the CBN on behalf o

the Federal Government. Prices are quoted in units and at a given percentage. CBN underwrites all issues CBN ensures its marketability (providing discount window

facilities).


Investment Vehicles

Capital Market Bonds Fixed income security. Issued in denominations of say N1000 and

multiples thereof. Long term promissory note. The interest or coupon rate is paid to bond

holders at a regular intervals or semi-annually.


Investment Vehicles Capital Market

Debenture (Loan) Stock*Long term debt finance raised by a company for which interest is payable at fixed rate and at specific time (s) in a year. *The issuing company is liable to pay the specified fixed interest whether it makes profit or not. *holders are creditors to the company.


Investment Vehicles

Capital Market Preference Shares

*a hybrid security *holders entitled to a fixed rate of dividend

Ordinary Shares*holders are real owners of the company. *they exercise control over the company through their voting rights *not entitled to fixed rate of dividend

Starting a business

Calculate your costs

Write your business plan

Identify sources of financing the business

Choose a business structure and name your new business

Develop the business start up book keeping and documentations


Starting a business….

Develop your marketing and customer services plans

Court your first customer

Develop and hire your support team

Open up to more opportunities (diversification)



Investment in Real Property

* It’s a hedge against inflation* Rent receivable is more certain than dividend* It’s a secure form of investment


Investment In Insurance

It is the conversion of indeterminate risks into fixed costs by way of consolidation or an economic device whereby risks of living and of economic enterprises are transferred.

(a) Life insurance including pension schemes management

(b) Non-life insurance business


Trading with share certificate

· Buying of shares

-Initial Public Offering (IPO)

-Secondary Market

-Bonus

-Right Issue

·


Trading with share certificate

Registration with CSCS

· Subscribing to Trade Alert

· Time to trade -sell

-buy

-hold


Investment Register

The following information is shown:1.The description of the item – share2.The name of invested company3.Mode of acquisition -IPO, bonus issue, right

issue, stock market4.Accounting year end of the company 5 Date of acquisition 6 Units acquired7 Price per unit


Investment Register….

8 Total amount paid9. Commission paid (if applicable)10. Date and amount of dividend received 11. Current stock market price12 Number of shares disposed13 Amount received on disposal14. Date of disposal15. Profit or loss on disposal16. Number of shares remaining etc.

Basic Accounting Books

Cash book to be opened for each bank account opened. only the transaction involving the business should be

entered

General Ledger accounts should be opened for item of -

expense; income; assets; liabilities; capital etc.


Basic rules to be observed

Issue receipt for all cash/cheques received regardless of amount involved

Raise invoice for all credit sales Raise voucher for payments to be made

regardless of the amount involved Do not take any money/goods from the

business without recording it. Do not pay for personal expenses out the

business funds21 April 2023 Ogwezi Nwachuku 38

Bank Reconciliation Statement

Preparing Bank Reconciliation Statement The process of bringing the cashbook and bank

statement balances to agreement.

An Investor should know this because most of the transactions with respect to investment are carried out through banks.


Bank Reconciliation Statement...

Why bank and cashbook balances may not agree

Unpresented ChequesUncredited ChequeDirect payment or Credit transferDividends Standing OrderBank ChargesDishonoured ChequeError by either Bank or Customer



Documents involved in the Reconciliation Cheque booklet (stub) Cheque register Bank account Bank statement CBN Guide to bank charges



Follow up action

The bank should be taken up on any of the following:

Wrong debit Transfer out and re-transferred-in without

authorization Deposit staying too long before being credited



Other Investment Outlets:

Whichever other areas an investor wants to go into, the determinants of investment decisions, which were discussed earlier, are not to be left out in the investment decision process.


Other Investment Outlets……

Some of the small-scale businesses or areas where investments can be made are; (a thorough feasibility study and investment appraisal is important).

Honey makingSoap making Poultry farmingTradingCash crops farming


Other Investment Outlets…..

PastriesFish FarmingLivestock ProductionPlantain & Potato Chips ProductionTooth Pick Garri Processing



Laundry & Dry CleaningSnail FarmingPhotography & Video CoverageCar WashHair Dressing & Barbing SalonCatering


Other Investment Outlets….

Pure WaterGas VendingMeat ShopVulcanizing



Child (Crèche) &Elderly Care Services Janitorial Recharge Cards & Phone AccessoriesNewspaper VendingBusiness Centre, etc.


Imbibe The Spirit

Open a separate bank account to keep track of your investment as distinct from your salary account.

Imbibe the principle of financial discipline Do not go beyond your budget


Imbibe The Spirit

An individual/ a family should have a ‘Personal Financial Adviser’ in order to reap the full benefits of the opportunities in the financial market (money and capital markets).

The slogan from now on is “Do not make investment out of sentiments”.

Conclusion

Skills acquisition and development requires a personality profiling before deciding on kind of business to engage in.

We need to undertake business planning before starting a business.



Case Study/Experience Sharing

1.Reynhard Bonnke, a renowned Preacher and Evangelist has scheduled a power packed Crusade to hold in Abuja (Nigeria) between August 28 and 30 this year. The Theme of the Crusade is “Total Deliverance from Devil”. What can you see in this forthcoming Crusade?


CASE STUDY/EXPERIENCE SHARING

2.Looking around your office or environment, what are those revenue/income generating activities you can tap into?


Case Study/Experience Sharing

3. In the monthly draw recently held by the Ministry of ‘No Work No Pay’ you emerged as the best staff of the Ministry for the immediate past year. The Honourable Minister rewarded you with the following:


CASE STUDY/EXPERIENCE SHARING....

1 plot of land at Maitama District of Abuja

1 plot of land at Asokoro District of Abuja

I HUMMER Jeep

How do you intend to utilize the above?

I hope we have been able to work together. We should be able to navigate together too.


EXPERIENCE SHARING, QUESTIONS & ANSWERS



Thank you!!

Have I been able to carry you along?


25 december 2015ogwezi nwachuku 11 investment opportunities: making your money work for you...

Documents

anotherogwezi nwachuku

loss money

introductionthe money

money work

lot of money

dont value money

investment opportunities

investment skillsusing