BASICS OF SHAREHOLDING ... to show that you value money ... invest ...

 Samuel Segbenu
“All the money in the world is no use to a man or his country if he spends it as fast as he makes it. All he has left is his bills and the reputation for being a fool”.

- Rudyard Kipling.

A man also said that, “when purpose of a thing is not known, abuse is inevitable”. If all you know is how to make money, then you are heading for financial bondage.

You need to realize that, money is a fruit that has a seed. The fruit is what you enjoy now, while the seed is what you save and invest for the future. One of the ways to show that you value money is to invest it. In this case, we are referring to investment in shares.

Buying shares in a company through the stock market means you are buying to become part owner of that company. You share in their profits and when they lose, you also share in it. You need not be a member of staff of a company to be a shareholder.

HOW DO I START?
1.
Be well informed about the company you want to invest in.

2.

Set a financial goal for yourself.

3.

Seek the advice of a consultant in this area; usually a stockbroker.

4.

When you have reached your goal, know when to sell (optional) to make your gains.

5.

Use the proceeds to buy into shares with a promising future.

BENEFITS

You enjoy annual dividends (a part of a company’s profit at the end of the year). I got my dividends from almost all my stocks this year and the returns were amazing.

Bonus issue (free shares); for instance, 4 out of the companies I invested in gave me bonus shares: 1 for 3, 1 for 4, 1 for 7, 1 for 5 and have thus increased my portfolio.
Capital appreciation is another benefit of investing in shares i.e. your shares increase in value and worth overtime. For example, I bought shares of Cadbury Nigeria Plc and when it appreciated by 63%, I sold them and used the proceeds to buy the shares of Guaranty Trust Bank Nigeria Plc. I also bought some shares of First Bank Nigeria Plc at N18.50 and now, (July 2006), it is N55.00; you see what I mean.

If you are smart enough to invest so much to have the highest number of shares in a company, you may be elected by the other shareholders as a director of the company. It is a way of transferring wealth from one generation to another generation.

I believe money making through shares is a product of personal adventure; the understanding of the techniques involved will make anybody a superstar in business. Investment in shares is a way of making money work for you instead of working for money and as a small investor; you can reach your financial goal.

Culled from XPRESSIONZ magazine maiden edition (June 2006)