How to Buy MTN Shares in Nigeria: A Step-by-Step Guide for Beginners
Buying shares means buying a piece of a company. When you buy shares in MTN Nigeria, you become a part-owner of one of Nigeria’s biggest telecom companies. This means you can earn money through:
- Dividends: Periodic payments from the company’s profits.
- Capital Gains: Profit when the share price rises and you sell at a higher price than you bought.
Step 1: Learn the Basics of Stock Investment
Before you start, understand these key terms:
- Share/Stock: A unit of ownership in a company.
- Stockbroker: A licensed person or firm that buys and sells shares on your behalf.
- Nigerian Exchange Group (NGX): The official stock exchange in Nigeria where shares are traded.
- CSCS Account: An electronic account where your shares are safely held.
Step 2: Why Buy MTN Shares?
MTN Nigeria is a leading telecom company with millions of subscribers. It’s well-established, meaning your investment has a strong foundation. MTN also pays dividends, which means you earn regular income just for holding their shares.
Step 3: How Much Can You Make?
Your earnings depend on two main things:
- Dividends: MTN usually pays dividends yearly. For example, if MTN declares a dividend of ₦10 per share and you own 100 shares, you earn ₦1,000.
- Capital Gains: If you buy MTN shares at ₦150 and the price rises to ₦200, selling your 100 shares will earn you ₦5,000 profit (100 × ₦50 gain).
Note: Share prices fluctuate daily, so there’s potential for both profit and loss.
Step 4: Open a Brokerage Account
You cannot buy shares directly on the stock exchange as an individual; you must use a licensed stockbroker.
How to Choose a Broker
Look for brokers that are:
- Licensed by the Nigerian Exchange Group (NGX)
- Have good reviews and customer support
- Offer easy ways to trade (online or app)
Step 5: List of Licensed Stockbrokers in Nigeria
Here are some well-known brokers where you can open an account and trade MTN shares:
- Meristem Securities
- Stanbic IBTC Stockbrokers
- CSL Stockbrokers
- CardinalStone Securities
- FBNQuest Securities
- ARM Securities
- Chapel Hill Denham
- Vetiva Securities
- Cordros Capital
- Aristos Stockbrokers
You can visit their websites or offices to start the registration.
Step 6: What Documents Do You Need?
To open a brokerage account, prepare:
- Valid government-issued ID (National ID, International Passport, Driver’s License)
- Recent passport photograph
- Proof of address (utility bill, bank statement)
- Bank Verification Number (BVN)
You’ll also complete:
- Account opening form
- Central Securities Clearing System (CSCS) form (for electronic shareholding)
Step 7: Fund Your Brokerage Account
After your account is set up:
- Deposit money into your brokerage account via bank transfer or other accepted methods.
- Make sure to include enough money for the shares and brokerage fees.
Step 8: Place an Order to Buy MTN Shares
Contact your broker or use their online platform to:
- Specify the number of MTN shares you want to buy.
- Choose the type of order:
- Market order: Buy immediately at the current market price.
- Limit order: Buy only if the price drops to your set price.
Step 9: Confirmation and Share Allocation
Once your order is executed, shares are credited to your CSCS account. You’ll get a trade confirmation with details of the transaction.
Step 10: Monitor Your Shares and Earnings
- Track MTN share prices on the Nigerian Exchange website or your broker’s platform.
- Keep an eye on MTN’s dividend announcements to know when you’ll get payments.
Step 11: Selling Your MTN Shares
If you want to cash out:
- Place a sell order via your broker.
- Once sold, proceeds (minus fees) go back to your brokerage account.
- You can withdraw the money to your bank.
What Are the Costs?
- Brokerage Fee: Usually 0.5% to 1% of the transaction value.
- NGX Levy: 0.003% per transaction.
- Stamp Duty: 0.075% of the transaction value.
- Withholding Tax: 10% on dividends.
Final Tips for Beginners
- Start Small: You can buy as few as one share.
- Diversify: Don’t invest all your money in MTN only.
- Stay Informed: Follow financial news and MTN reports.
- Use Trusted Brokers: Only trade with licensed brokers to avoid scams.
