NSE FOR DUMMIES : NAIROBI SECURITIES EXCHANGE

What exactly goes down at the Nairobi Securities Exchange? This is a question my friends and I have been trying to unravel since registering for the Young Investors challenge yesterday. See Links Below { http://stf.younginvestors.co.ke/nsechallenge/register.php or https://www.nse.co.ke/public-education/nse-investment-challenge.html } . Investment banking is a goal I have harboured for long and curiosity has driven to the floor severally.  Below are the Basics I believe participants of the Young Investor Challenge will find very useful.  Let’s call it NSE FOR DUMMIES :-).

nairobi-stock-exchange-LOGO

The Nairobi Securities Exchange or the NSE is a market like any other but specialises in financial instruments such as government and corporate Bonds, stocks, trusts. Started in 1954, there 51 listed companies and the number will increase this year.  Stocks or Shares are unit of ownership in a company. One important factor to remember is that when you invest in stocks, you are investing in the future of the firm. The NSE is divided into two markets, the Main Market Section and the Alternative Investment Section.

So how do you Make Money from the NSE?

There are mainly two ways of making money.

Capital Gain – The selling of shares at a price higher than the buying price. An example is an investor who bought Safaricom 1000 shares at kshs.  5.50. When Safaricom announces their annual results, the price of the shares rises to kshs. 7.50. The investor sells the shares at that 7.50. For every share held, he will make a gain of 2.00.  Meaning he will make a capital gain of 2,000/=.

DIVIDENDS Companies normally share their profits through offering dividends to the shareholders.  Suppose the same investor decided not to offload the shares, but take the dividend offering. Safaricom decides to offer a dividend of 80 cents per share. The Investor will earn 800/= from their investment.

PRICES

Share prices on the NSE float up and Down.  There are several Factors that determine the Price Movement on the market.

  • Forces of Demand and Supply

On a particular day the prices of the shares of given companies may move up due to demand where investors want a given stock. In other instances, the prices of these stocks may go down due to much supply.   The demand and supply is sanctioned by various factors such as Company Performance. When KCB registered stunning performance for the first quarter, the demand for the share rose from average of Kshs 36.00 to Kshs 38. 00.  Corporate action where decisions in a firm affect the price of the share in the market. The failed acquisition of Kenol-Kobil by PUMA energy had adverse effects on the price of the stock.   News Stories also affects the shares of the company.  If you read the Business Daily on Tuesday, it provides clear insight on news stories on companies such as change in leadership and planned company activities. Some of the news in a large way affects the share price. Economic Status of the Firm also affects the price of the shares whereby revenues and profits may lead to investors buying shares while a decline may lead to dumping of stocks.  On the economic status of the firm, increased debt and poor acquisition may lead to poor prices of shares.

HOW TO BUY AND SELL 

Buying of Stocks on the NSE is done through Authorised Brokers. Investment Banks also serve as Brokers.  Some of the authorised Brokers are Dyer and Blair, Genghis Capital, Suntra Investments, Kingdom Securities, Tsavo Securities among others.  To purchase shares, an investor requires a CDS account (Central Depository Settlement Account). The minimum number of shares for any investor is 100 shares or shares worth 3,000/= shillings. The standard charges are 2.1% for shares below 100,000/= or 1.8% for shares above 100,000/=.

NB: – buy when Low, sell when High!!

TERMS

You have probably heard this on the news. These terms are common in the market.

Bullish run –  a trend where the share prices are expected to rise. Bullish markets are characterised by increased investor confidence and optimism for strong results.

Bearish run-  A trend where the prices of stocks decline over a period. Over this period there is  pessimism and most investors anticipate losses.

Index-  An index is used as a yard stick to reflect the market that they represent.  On the NSE, there are various indices with the NSE share index being quoted the most by the media. Indices normally show trends in investment patterns.

Some of the Indices commonly quoted in the world include the NASDAQ Composite that tracks performance of technology companies, the Dow Jones Industrial Index that tracks the 30 largest companies and the Standard and Poor (S&P) which tracks the 500 most traded companies on the NYSE.

Market Capitalisation– The market Capitalisation is the number of shares multiplied by their current price on the stock market.

Sectors- Simply the classification of stocks based on the industry such as agricultural, commerce and services.

I know my forte is in Information Technology.  So for criticism, Comments and more Information www.twitter.com/MrEricWainaina

NSE-Investment-Challenge-2013

Photos courtesy of: Pesatalk.com, NSE.

 

 

 

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APP CHECKLIST: MUST HAVE SAMSUNG GALAXY S4 APPLICATIONS

The SAMSUNG GALAXY S IV is King.  The S4 is a combination of class and performance geared towards giving the ultimate android experience.  Dubbed the Life Companion, the S4 is out to make life easier. The S4 runs on the latest jellybean 4.2.2 with a superior 5-inch display coupled up with a Full HD Amoled display.  A 13 Mega-pixel Camera and a quad-core processor!! Clearly, it is a Beast.

SIV Your Life Companion

Assuming you have just bought the Samsung Galaxy S4, and downloaded the security enhancements from Samsung Store (That is always the First thing I do) what apps should I install?

BROWSERS

Browsing the internet is the first thing on everyone’s mind. It’s typical to have Chrome, Mozilla, Opera and all other mobile browsers on your phone but on the S4, Chrome will be the best choice.  Chrome is fast in response, and easily handles tabs and lets the user to switch between the desktop and the phone and manages bookmarks and user’s most visited sites for ease of access.

Link: https://play.google.com/store/apps/android.chrome

Alternative:  Users can also download Dolphin Browser, which offers a closer experience to Google Chrome

Keyboard

I have always had problems with the Samsung keyboard and the decision to have the S4 come with the Swift Key Board, as the default was futuristic.  Swift Keyboard is faster, easier and more accurate.  It also learns the words and the phrases commonly used and how one interacts with the keyboard.

Link: https://play.google.com/store/apps/touch.swiftkey

Alternative: Hackers Keyboard it provides the layout used on computers and offers an equally better experience. It is also free on the playstore

Link: https://play.google.com/store/apps/Hackers keyboard

Games

With the 5-inch display and quad-core processor, gaming will be a top agenda for most S4 users.  Top on the S4 accessory is the S4 Game Pad that uses Near Field Communication to allow the user to play their games.  Among the games S4 users can enjoy include Dead Trigger that lets the player shoot zombies over various levels under a basic progression system where players upgrade their arm assortment as they progress.  Popular games such as Temple Run, Angry Birds and Cut-the-Rope need minimal introduction.  With the gamepad, racing and sports gamers are out for an experience and Asphalt 7 and FIFA 2012 and FIFA 2013, should offer the player quite the thrill.

Link Dead Trigger:  https://play.google.com/store/apps/Dead Trigger

game padThe Galaxy S4 Game Pad.

NEWS

Keeping up to date with all the news and information is no longer about reading 7 newspapers daily.  Flipboard not only makes reading news fun and casual, it makes wholesome. If you do not fancy politics, users can easily edit that and read what they like.  Sharing information is also easy with links to Facebook and twitter.  Appy Geek is also another platform that delivers the latest news in the tech world and keeping you knowledgeable. Additional applications a user may need to make the news experience better include Pocket and Instapaper where users can post articles and read them later on.

Samsung-Galaxy-S4-FlipboardFlipBoard on the Galaxy S4. Pure Bliss

Link:  https://play.google.com/store/apps/flipboard

Alternative: Alternative applications for Flipboard, Include Pulse, which offers users a chance to choose topics they are interested in and a feed for the same is delivered to them via the application. Currents and Material Beta also offer the user such an experience.

Link:    https://play.google.com/store/apps/PULSE

https://play.google.com/store/apps/GoogleCurrents

Antivirus

It is common knowledge that there is an influx of malwares and virus within the android platform. Actually, the number has tripled and subsequently quadrupled meaning security is key. I would advise that you use McAfee and Norton antivirus but they will not be as effective as the Mobile antivirus Security Pro, a product of AVG.  I have used the antivirus on various android devices and it has not only been effective but also does not eat into your RAM. It also lets block call and texts, protects from spammers and warns you of impending threats.    

Link: https://play.google.com/store/apps/Mobile antivirus Security Pro

Additions APPs

There are also those must have applications on your phone. Some of the applications which are a must have on the S4 include Google Keep provides a unified remainder that is integrated on your email, with the 5” screen, Side Bar Pro will aid in switching apps,  Google Googles this application allows you to search via photos or images. With the 13MP camera, there is just so much Google Googles will Google.  MA3Route an application that will keep you aware, on the traffic situation in Nairobi, PesaDroid to help you manage your M-pesa balances better.

Link:     https://play.google.com/store/apps/ma3route

https://play.google.com/store/apps/pesadroid

 Home MA3ROUTE 

The Samsung Galaxy SIV launches on the 26th. Pre-orders through Safaricom via this link http://www.safaricom.co.ke/samsungs4/ once you lay hands on the beast, be sure to use the Checklist. Wishing you and Your “Life Companion” an easy life :-).

the S4 The Samsung Galaxy S4