INVESTMENTS, WHAT IS YOUR STRATEGY?
Making investments is easy, but do you have the right strategy in place?
Suitcase? check. Passport? check. Credit card? check, check, check. I was ready to jet off to Las Vegas with my amazing work mates. We had planned this retreat for 3 years and it was finally happening. 7 of my amazing work mates were going to be boarding the next flight from Lagos. We were all fatigued and needed this holiday. At the airport, I saw hundreds of people check in and wondered how I was going to tap into such crowd. Surely with such travel demand, these airlines should be making good profit, right? Were there any aviation stocks to invest in? would that be a good investment decision? Surely I needed to do more research.
We arrived at Vegas and checked into our various hotel rooms and one huge thought struck me. Why hadn’t I thought of investing in this industry? My room had beautiful and soothing décor all around, and had good similarity to some hotel rooms in Nigeria. Infact the Hospitality and Tourism Industry in Nigeria contributed about 4.8% to Nigeria’s GDP in 2017. Gross Domestic Product, GDP, is the monetary value of all the finished goods and services produced in a country in a specific time period. It is commonly used as an indicator of the economic health of a country, as well as a gauge of a country's standard of living. So if the tourism industry generated 4.8% surely that industry didn’t do badly that year. Transcorp Hotels, the hospitality subsidiary of Transnational Corporation of Nigeria reported that its 2016 revenue rose by 10 per cent to N15.31 billion, compared to N13.78 billion posted in 2015. The NSE said its revenue growth was driven mainly by strong sales of rooms.
The holiday was going so well. Day time and night time were awesome, I learnt how to use the slot machine, played poker and even won a few hundred bucks. I am against gambling, but we were having such a great evening when my colleagues got into a bet. Yes, they suck me into that bet too, and I won. Wuhahaha. I had learnt some poker tactics from one of my uncles years back and they didn’t realize that some of the best poker players are good investors. Bad players are known as fish, and good players are known as sharks. The sharks eat the fish. These are poker terms just like the invesment market has its own terms, bullish and bearish.
A bullish market arises when the market is showing confidence,prices are going up, the number of shares traded is high and even the number of companies entering the stock market show that the market is confident. A bearish market is the opposite to a bull. It shows a lack of confidence and prices hover at the same price then go down. Some people believe that by recognizing the different kinds of markets you can make money on stock trading and investing. The basic idea behind buying stocks is to buy low and sell high. This will give you a profit. So to make money you buy stocks in a bear market when stock prices are low and sell stocks in a bull market when stock prices are high
Sometimes in poker, the player wins, sometimes they lose but making the right bet pays off. The good player tilts the odds in their favor, and knows that making the correct choice with enough consistency will cause them to come out ahead. Investing is no different. There are unpredictable situations in life, even in investing. This means that some investments make good profit, and some do not. However, if you follow strategic investment plans, this tilts the odds in your favour. There is a similarity in this to the professional poker player who puts his chips in when the moment is right. Over time, the majority of our well calculated investments pay off.
That said, it was 2 weeks of rest and fun and we had just one more day to return home. Yes, I had gained some weight eating double decker burgers and fries, but was happy to return to my family in Nigeria. A Few of the things I learnt on this trip had helped gear me for my next investment year and I was excited to head back home to begin my research. Some of the strategies I had learnt would enable me build a stronger investment portfolio. What about you, do you have a winning investment strategy?