This memo is your one-page business plan for each investment. It forces you to think clearly before you spend money.

Your 1-Page Pre-Investment Memo:

• Company & Thesis (2 lines): What does the company do and why is it a good investment right now?
• Competitive Advantage (“Moat”): What special thing protects it from competitors? (e.g., a strong brand like Coke, a network effect like Facebook, a low-cost advantage).
• Key Metrics & Valuation: List the P/E, P/B, Dividend Yield, ROE, etc. Then write one sentence: “Compared to its peers, this stock appears [Undervalued / Fairly Valued / Overvalued].”
• Bull Case (3 points): What could go right to make the stock go up?
• Bear Case (3 points): What could go wrong to make the stock go down?
• My Plan:

• Entry Strategy: “I will start with a small position at price ₦X.”
• Exit Strategy: “I will sell if [a key reason I bought the stock] is no longer true.” or “I will consider selling some shares if the price increases by 50%.”

Your Path Forward: The Continuous Learning Loop

• Next Steps:

• 1. Read one full annual report of a company you own.
  2. Listen to a company’s quarterly earnings call (you can find recordings on their investor relations website).
  3. Stay curious. Keep reading, learning, and refining your process.

 

Welcome to the Nigerian Stock Market!

Investing is a marathon, not a sprint. Your goal is to build a good process that you can stick with for years. Use this guide, be patient, keep learning, and let the power of compounding build your wealth over time.