Nigeria is so blessed that it has been described as the ‘Giant of Africa’. But the giant does not seem to recognise her gigantic posture in many areas. The giant goes to sleep and often needs to be awakened. This may be the reason why she still crawls at 100.
The above situation is also playing out in online forex trading and other instruments.
Let me share an experience here. I once opened a forex account with a trading arm of a world-class United Kingdom bank. Before I could fund this account, I got a mail that my account would be closed and it was thus closed. The reason may not be farfetched; the regulatory authorities in such strict financial jurisdiction give their brokers no breathing space. The giant trading outfits of such strictly regulated countries are excluding traders from non-regulated countries.
Also, these strict countries do not get capital gain tax from traders outside their jurisdiction.
Nigeria, according to the first Lagos forex expo website, is estimated to have 300,000 traders (active and docile, I guess); and by Google, its forex trading is ranked as the fastest growing.
With a conservative trading fund/investment of $1,000 per trader, it means Nigeria traders have about $150m worth of investment outside the shores of the country with foreign brokers.
That amount in the local currency at an average exchange rate of $1to N160 is N48bn. What a whooping amount that ought to reside in our banks.
I can bet that if online forex trading is regulated in Nigeria, many brokers will jostle to pick up licences. A renowned forex brokerage firm has Nigeria generating over 20 per cent of its $600m profit, yet it has no presence in the country. It, therefore contributes nothing in terms of tax, human capital development in this field and no direct investment.
An average licence of FX brokerage firms is worth more than $200m, if not more. This is more than what used to be a GSM firm license fee. If 10 forex brokers are in Nigeria, our government can rake in over $2bn (N320bn). The influx of foreign brokers can also spur the emergence of a true Nigerian forex broker.
If we have an estimate of 300,000 traders, assuming each trader places an average of 10 standard lots per month, conservatively, it means foreign brokers are making $20 per standard lot and $200 on 10 trade orders, thus totalling $60m (N10bn) per month. Can’t we have a local broker?
What about the job opportunities this will offer to our populace? This submission is an eye opener about what we stand to gain collectively as a nation with our ‘giant’ status. Africa is seen as the emerging market; in this area, Nigeria is the bride of brokers. There is need to open our doors to this opportunity.
Our financial regulatory authorities should be proactive by swiftly coming up with a framework to harness these opportunities. The world has gone online. We are a sleeping giant; we must wake up to the reality of the current situation.
Market tips for the week Mon June 16 – Fri June 20
Entry (SEP) and exit (TP) could also be at trader’s discretion.
A lot of trading opportunities abound this week in the pairs below.
The strategy is to buy up to the region of sell limits and also sell up to the region of buy limits. Entries can then be as suggested. The last TP could be used also as reversal points.
EUR/NZD: SELL LIMIT@ 1.5700 – 1.5750 TP: 1st – 1.5480 TP:2nd –1.5400 SL: 1.6057
GOLD (XAU/USD): BUY LIMIT@ 1273-1276.20 TP1: 1289.20 TP2:1294.00 SL:1250.14
SILVER (XAG/USD): BUY LIMIT@ 19.75-19.60 TP1: 19.75 TP2:19.97 SL:18.95
EUR/JPY: SELL LIMIT@ 138.50-138.90 TP: 1st – 137.46 TP:2nd –137.01 SL: 140.10
GBP/CHF: BUY LIMIT@ 1.5165 – 1.200 TP: 1st – 1.5475 SL: 1.4990
CHF/AUD: SELL LIMIT@ 1.1860 – 1.1878 TP: 1st – 1.1655 TP:2nd –1.1610 SL: 1.1989
NZD/USD: BUY LIMIT@ 0.8600 – 0.8605 TP: 1st – 0.8745 TP:2nd –0.8778 SL: 0.8401
AUD/CHF: BUY LIMIT@ 0.8399 – 0.8410 TP: 1st – 0.8576 TP:2nd –0.8610 SL: 0.8337
: by ‘Kunle Adeyeri from Mon, June 30th.
(Visit www.naijaonlinetraders.com and www.kardsfx.com)
Source: Punch Newspaper
No comments:
Post a Comment