MarketWatch

[emmanuel ewumi]

Originally Posted by emmanuel ewumi

That is why Nigerians should be educated, enlightened and empowered so that they can take their rightful place in our economy.

I always ask my self how come our Institutional investors refused to buy into the market when the ASI went to to 20,000. I bought, but I did not buy the way i would have loved to buy.

Normal retail investors with millions of units of good stocks did not buy those stocks when the market is bubbling with activities, they made strategic purchases when no one is interested in the market. That is why these types of investors are never afraid of falling stock prices, they are only afraid of deteriorating fundamentals of the companies they invest in.

[wanaj0]

Originally Posted by emmanuel ewumi

That is why Nigerians should be educated, enlightened and empowered so that they can take their rightful place in our economy.

I always ask my self how come our Institutional investors refused to buy into the market when the ASI went to to 20,000. I bought, but I did not buy the way i would have loved to buy.

Who are the institutional investors. Apart from mutual funds, insurance companies who else really? PFAs are the one needed not to sustain the market but you can't gamble away peoples pension with the fundamental weakness in the market.

[dr dowell]

Originally Posted by emmanuel ewumi

The last bear market was unnecessarily long, historically bear market lasts an average of 3 years. The recovery should have started in 2009, but alas we lost it.

Stocks are currently under valued compared to what stocks of the same business, pedigree and market are selling for in similar stock exchanges in Africa and emerging markets.

As a matter of fact ASI of 40000 in 2013 is an understatement.

I agree with U that the last bear lasted longer than necessary the reasons are not far fetch.
(1) The Global financial crunch made foreign investors to sell and took their money to their countries.
(2) The intervention of SLS in the banking sector. The banking sector then constitute up to 50% of activities in NSE
(3) The weakness in the capital market regulatory authority
(4) The high MPR which made TB and bond more attractive.

[manemi]

KKR Said to Consider Investing in Africa, Following Carlyle - Bloomberg

[gbengus]

Sentiment Analysis Report – W/E February 08, 2013 - Proshare

[netotse]

Originally Posted by gbengus

Sentiment Analysis Report – W/E February 08, 2013 - Proshare

na so so hold them just dey recommend...lol

[Born 2be rich]

http://www.businessdayonline.com/NG/...res-in-january

[hispy99]

Rewarding bad behaviour in the capital market

[Salida]

SEC Restates Commitment to Deepening the Nigerian Capital Markets and widening Investor Choice thro - Proshare

[faithgonuel]

Ogas for floor, abeg AFCON Bulls entet market?

[lolobo]

X–Compliance Report by NSE - Quoted companies on The Exchange are required to file their quarterly accounts within 45 days after the end of the quarter. The free float requirement for companies on the Main Board is 20% and 15% for ASEM companies. Have you guys seen the report?

[omsby]

Originally Posted by wanaj0

Who are the institutional investors. Apart from mutual funds, insurance companies who else really? PFAs are the one needed not to sustain the market but you can't gamble away peoples pension with the fundamental weakness in the market.

Hallo everybody. The following question is directed at Fund managers operating in nigeria , or people who through their access to them can answer it.

On what basis do you determine if a stock in your portfolio is overpriced according to regulation of your organisation?

To put it in other words: what criterium do you use to determin wether a stock
you are holding is overpriced?

Thanks for your response.

[emmanuel ewumi]

Originally Posted by omsby

Hallo everybody. The following question is directed at Fund managers operating in nigeria , or people who through their access to them can answer it.

On what basis do you determine if a stock in your portfolio is overpriced according to regulation of your organisation?

To put it in other words: what criterium do you use to determin wether a stock
you are holding is overpriced?

Thanks for your response.

KOD should be able to answer your questions. The only problem with them is that they all invest in the same stocks. Eg Nestle, NB, GTB, FBN, Flour Mills etc

[knightofdelta]

Originally Posted by omsby

Hallo everybody. The following question is directed at Fund managers operating in nigeria , or people who through their access to them can answer it.

On what basis do you determine if a stock in your portfolio is overpriced according to regulation of your organisation?

To put it in other words: what criterium do you use to determin wether a stock
you are holding is overpriced?

Thanks for your response.

Corporate governance.

When you hold 5% of a company, you can't just up one day and say I want to exit because the PE is 30 especially when you have long term funds. Using that kind of criteria will lead to incessant trading that will end up wiping the returns.

Take for example, you hold 1 billion units of FBN, which you bought at N11 as an institutional investor at a value of N11 billion. Brokerage fee is N110 million. Now that FBN is N18 and you decide to sell because the PE is now high or something like that, you will attract a commission of about N180 million, just like that. And remember that as an institutional investor, you hold long term funds. You are also a major shareholder and can bear on the company to improve their processes.

In a nutshell, institutional fund managers are fund managers not stockbrokers or "fund traders" or "hedge fund managers" with a vested interest in the companies that they hold with a long term perspective and the belief that they will continue to generate superior returns regardless of that the market says within a period of a few years. (Who is talking about months or even weeks sef, not to talk of days?)

The only thing that will make fund managers exit a company is when they discover shady deals, poor corporate governance, blatant fleecing of shareholders, dead or dying sector or a company that refuses to change its perspectives when things start going bad, etc. The price, the PE, the PBV is the last thing a fund manager thinks of.

[omsby]

Originally Posted by emmanuel ewumi

KOD should be able to answer your questions. The only problem with them is that they all invest in the same stocks. Eg Nestle, NB, GTB, FBN, Flour Mills etc

.. thanks.

[omsby]

Originally Posted by knightofdelta

Corporate governance.

When you hold 5% of a company, you can't just up one day and say I want to exit because the PE is 30 especially when you have long term funds. Using that kind of criteria will lead to incessant trading that will end up wiping the returns.

Take for example, you hold 1 billion units of FBN, which you bought at N11 as an institutional investor at a value of N11 billion. Brokerage fee is N110 million. Now that FBN is N18 and you decide to sell because the PE is now high or something like that, you will attract a commission of about N180 million, just like that. And remember that as an institutional investor, you hold long term funds. You are also a major shareholder and can bear on the company to improve their processes.

In a nutshell, institutional fund managers are fund managers not stockbrokers or "fund traders" or "hedge fund managers" with a vested interest in the companies that they hold with a long term perspective and the belief that they will continue to generate superior returns regardless of that the market says within a period of a few years. (Who is talking about months or even weeks sef, not to talk of days?)

The only thing that will make fund managers exit a company is when they discover shady deals, poor corporate governance, blatant fleecing of shareholders, dead or dying sector or a company that refuses to change its perspectives when things start going bad, etc. The price, the PE, the PBV is the last thing a fund manager thinks of.

... thanks. A fund manager does not need to exit, but may sell down a little. Based on what criterium is this decision made.

[knightofdelta]

Originally Posted by omsby

... thanks. A fund manager does not need to exit, but may sell down a little. Based on what criterium is this decision made.

The need for liquidity, which is highly unlikely especially when the portfolio is well planned.

[emmanuel ewumi]

Originally Posted by knightofdelta

The need for liquidity, which is highly unlikely especially when the portfolio is well planned.

Dividends from their investment should be able to take care of any liquidity problem.


When i have good money, i will love to invest and create wealth like fund managers.

[afolabi27]

Originally Posted by omsby

... thanks. A fund manager does not need to exit, but may sell down a little. Based on what criterium is this decision made.

Tactically, a re-balance may necessitate selling down one asset class (or stock) and increasing another.

[nosa2]

Originally Posted by knightofdelta

Corporate governance.

When you hold 5% of a company, you can't just up one day and say I want to exit because the PE is 30 especially when you have long term funds. Using that kind of criteria will lead to incessant trading that will end up wiping the returns.

Take for example, you hold 1 billion units of FBN, which you bought at N11 as an institutional investor at a value of N11 billion. Brokerage fee is N110 million. Now that FBN is N18 and you decide to sell because the PE is now high or something like that, you will attract a commission of about N180 million, just like that. And remember that as an institutional investor, you hold long term funds. You are also a major shareholder and can bear on the company to improve their processes.

In a nutshell, institutional fund managers are fund managers not stockbrokers or "fund traders" or "hedge fund managers" with a vested interest in the companies that they hold with a long term perspective and the belief that they will continue to generate superior returns regardless of that the market says within a period of a few years. (Who is talking about months or even weeks sef, not to talk of days?)

The only thing that will make fund managers exit a company is when they discover shady deals, poor corporate governance, blatant fleecing of shareholders, dead or dying sector or a company that refuses to change its perspectives when things start going bad, etc. The price, the PE, the PBV is the last thing a fund manager thinks of.

This also means that fund managers would find it very difficult to beat the index and is one of the reasons I dislike the rules guiding PFA's in this country.