In our last
investment asset post where were talked about investing in stock in NSE
(Nigeria Stock Exchange), we analyse how to get started in stock investment,
minimum amount one can start with et al. Now that you ready to dive into
investment pool of stocks investment, you need a reliable stockbroker to handle
your dealing.
Some
questions might arise like: how does one know and pick a reliable and reputable
stockbroker? What are the criteria to consider before picking a
stockbroker? How do I get one? All these
questions will be answered in due course in this post.
In case you
miss the previous investment asset post click Make-your-cash-off-stock-market to read it and then follow the
tips that will be highlighted here.
WHO ARE STOCKBROKERS?
Stockbrokers
are the dealing members of the Nigerian Stock Exchange (NSE). Each of such
members is licensed by the council of NSE and Stock Exchange Commission (SEC)
to participate with other members brokers in the business of selling and buying
shares listed in the NSE.
These
stockbrokers serve as platform through which groups and individuals buy and
sell securities in the exchange.
CRITERIA TO PICK A STOCKBROKER
The
following are some of the factors that one should considered before selecting a
stockbroker
v Must be registered/listed (Are they
recognized by NSE?)
v Proximity (How far is the stockbroker
away from me?)
v Minimum capital requirement (How much
can get me started this investment?)
v Integrity and professionalism (Are
they trustworthy and how do they treat their clients?)
v Personal Touch (How will they treat
me and my account)
v Availability of credit facilities
(Can they provide a loan access for me at desperate time?)
Now let me
try and explain about all these factors thoroughly.
CHOOSE A REGISTERED STOCKBROKER
As an
investor in stocks, all your dealings must be with a registered stock broking
firm. Doing otherwise would be beginning of problem in this line of investment.
Click here to check the list of Stockbroking Firms in NSE. A registered stockbroker has to stick to certain
guide lines stipulated by both NSE and SEC and thus your money would be
protected. Don’t just fall into pit of unregistered stock broking firms
floating themselves in various states of the federation. Before handing over
that your share certificates and money to any stock broking firm, find out if
they are registered.
PROXIMITY
This is one
the great factor one must also consider before choosing and picking a
stockbroker. You should choose stockbroker that is near you. Why should I be residing
in Jos and then pick a stockbroker in Port-Harcourt? Do you get what I mean
now? Being near your stockbroker is very important, one of the major reason is
that it gives you a great access for unplanned visitation to their office when
you have challenges with your account or need urgent inquiries to make.
MINIMUM CAPITAL REQUIREMENT
This post is
for everybody (both big time investor and small scale investor), so this part
of the criteria is one of the important factors to consider when one wants to
choose a stockbroker. In my previous about how to get started in stock
investment, I explained that there is stockbroker for everybody no matter the
capital you have at hand. So before trying to opening an account, you should
try and visit several registered stockbrokers, inquire about their minimum
requirements. You just have to consider your investment objective before
picking your stockbroker, so start digging about them (STOCKBROKING FIRMS).
INTEGRITY AND PROFESSIONALISM
One or two
questions that comes into any customers mind is/are:
i.
Are
these firms/products reliable/trustworthy?
ii.
Can
these firms/products treats me right and gives me quality services? Etc.
So also in
stock investments before you choose a stockbroker, these are likely questions
you should find answer to.
i.
Is
the stockbroker trustworthy?
ii.
Is
the stockbroker reliable?
iii.
Is
he going to tamper with my account?
iv.
Does
he stick to professional ethics and codes?
In this era
of get-rich quick, you must get answers to all these questions or else, you
might fall into the hand of scammers who hide under the façade of stockbrokers.
SERVICE DELIVERY
The
stockbroker of your choice must be up and doing. That is one of the quality
every firms hammer on (good service delivery, satisfying customers all the
way). So your proposed stockbrokers must not be an exception. When given a
mandate, it should be adhered to and act according to promptly and efficiently.
PERSONAL TOUCH
The
stockbroker should have some personal touch. What do I mean by that? He should
be able to advice the investor as regard viable and good stocks. He should take
the investors accounts as his and deal accordingly and should not just be interested
in the commission to receive.
AVAILABILITY OF CREDIT FACILITIES
Desperate
times might arise in the future and one might need access to ready loan. Your
stockbroker should be able to provide such to you easily and readily. That
shows he has solid ground and connections.
With all
these points listed, make out time and research the stockbroker of your choice
with those qualities before opening an account with the stockbroker.
Looking forward to your success likewise your questions,
comments and opinion, always welcome.
