A number of potential share investors in Kenya are intimidated by the prospect of trading on the Nairobi Stock Exchange (NSE). This is mainly because they do not understand the process involved in buying and selling shares, and how the market works. Many investors still believe that share investment is an activity only for sophisticated investors. However, this has changed significantly in recent years.
What are shares
Ownership of private companies is reserved for the rich. The wealthy have agreements with each other that allows them to share ownership of businesses in exchange for a fair cut of the profits. To do this, they use shares, which are a legal mechanism that entitles the shareholder to share ownership of any given company. The key term here is ‘share,’ which means that all owners have agreed to give up a certain percentage of their earned profits and divide it evenly.
This means that shareholders who own 5% of the company will receive 5% of the total profits and, in some cases, also benefit from voting rights. In Kenya, you can buy shares at licensed stockbrokers or online brokers. They work by allowing investors access to substantial returns on their investment and helping boost local economies through job creation through domestic investment.
With the increased availability of technology and with new, reliable stockbrokers available to serve Kenya’s growing investment market, more Kenyans are able to invest in stocks. The Nairobi Securities Exchange is a reasonably priced, safe place where the majority of Kenya’s trades take place.
Why you should buy share in Kenya
When one buys stocks, one is buying part ownership of a company and is entitled to dividends and capital gains. The reason people trade in stocks is to make a profit by buying and selling securities. Profitability depends on the timing of the market, market conditions, risk factors, supply and demand for stocks, a company’s performance, stock mispricing, and several other components. When one sells stocks, they are easily bought or sold because there is a high volume of buyers and sellers who participate in the market.
What do you need to start?
To trade on the Nairobi Stock Exchange, you will need a valid Kenyan ID or passport and a bank account. You will also need to open a CDS account at a stockbroker to buy and sell securities.
How to buy shares in Kenya in 2022
Step 1: Locate the broker or agent you want to use and fill in a securities application form. My choice is AIBAXY Africa forex brokers i have been using it for two years now and it’s an excellent option click on the link below to sign up.
Step 2: Once approved, AIBAXY will help you open a Central Deposit and Settlement account known as CDS Account You can also open a CDS account from your bank.
Step 3: AIBAXY will give you market-rate information about the stocks of various companies. He or she can also help you determine the best shares to buy in Kenya in 2021—depending on your risk tolerance, experience level, and amount of money you have to invest.
Step 4: You are all set to buy and sell shares on the NSE (Nairobi Stock Exchange). You should deposit a minimum of Ksh 5,000 into your CDS account to start purchasing shares.