Wealth management

24 June 2022

Investing in stocks

Over the last two decades, stocks have seen a significant rise in popularity as they have served as a vehicle for people to invest in exciting new technologies (think Amazon, Google, Apple, Facebook and Netflix). In Ghana specifically, more people are considering stocks as an investment option as seen in the interest shown in MTN’s IPO in 2018. In this article, we will discuss what stocks are and how one can invest in them.

Stocks are ownership rights in companies that can be bought or sold privately or publicly through a stock exchange. Owning stocks is one way to accumulate wealth over the long term as the potential returns are virtually unlimited.

The first step in investing in stocks is to decide what stocks you would want to own. This would require some research. You can find information such as the price and traded volumes of a stock by going to gse.com.gh. You can also find the annual reports of the companies being traded on the exchange at annualreportsghana.com. These reports will allow you to check on the profitability, revenue growth, liquidity and other important performance indicators of the companies whose stocks you want to invest in.

Once you are done with your research, you will need to open an account with a licensed brokerage firm such as IC Securities. Onboarding is easily done online at IC – just click here to get started. You will then be required to make a deposit into the account that will allow your broker to accept orders to purchase stocks on your behalf, or simply place your order through IC’s Tradelive platform on MTN Mobile Money. Note that brokers charge a commission of between 1.5% to 2.5% on each trade, with a portion going to regulatory bodies. Because of the volatility in the market, it may take some time for your broker to purchase the stock at a favourable price for you.

Monitoring the performance of your stock on a day-to-day basis could be useful, and IC has a variety of options to allow you do this on the web and USSD, but stocks are investments that are more likely to perform better when they are held over the long-term. It is therefore important that you select stocks of companies whose business prospects you believe in so that you are not bothered by short-term price volatility.

If you want to get started investing in stocks, you should consider talking to IC today. With a call to +233 (0) 308250051, you will be guided through the whole process by a professional.

Thank you for reading.