In the first seven months of 2025, investors in the Nigerian stock market have collectively gained over ₦25.7 trillion. The market has grown by 35.9% year-to-date (YtD), with July alone contributing nearly half of that growth.
It’s one of the strongest rallies in recent memory, but what’s driving this surge? More importantly, what does it mean for your finances, and how can you participate wisely?
This article breaks down the market boom in simple terms and helps you understand your investment options responsibly.
What’s Fueling the Surge?
The Nigerian Exchange (NGX) All Share Index (ASI) climbed from 102,926.40 points in December 2024 to 139,863.53 points by July 2025. Several factors are behind this performance:
- Exchange Rate Stability
Improvements in FX liquidity and reduced volatility in the Naira have restored investor confidence, especially for foreign and institutional investors. - Low Returns in Fixed Income
Yields on bonds and savings products have remained subdued, encouraging investors to shift into equities in search of higher returns. - Corporate Profit Growth
Many listed companies, especially in banking, industrial goods, and consumer staples, have reported stronger-than-expected earnings in H1 2025, pushing up their share prices. - Market Reforms
Liberalisation in key sectors and clearer monetary policy have improved sentiment across the board.
While this performance is impressive, past returns do not guarantee future results. Stocks can go down as quickly as they rise. It’s critical to approach investing with a long-term mindset and an understanding of risk.
Investment Risk Reminder
Why This Matters for Your Money
If you’re only saving in traditional bank accounts, you may be missing out. Inflation continues to erode the value of cash savings, while stocks offer the potential for long-term growth.
But, and this is important, stock investing isn’t a get-rich-quick scheme.
Returns can fluctuate. It’s about building wealth gradually and consistently, not betting on the next big jump.
What Are Your Investment Options?
While many new investors use platforms like Cowrywise to start with stocks, you should also know about other available vehicles that suit different goals and risk profiles:
- Direct Stock Purchase via Stockbrokers:- Traditional brokers offer access to the full NGX and may suit experienced investors who want to manage their portfolio actively. Fees vary, typically between 0.5% to 1.5% per trade.
- ETFs (Exchange-Traded Funds):– ETFs offer a simple way to invest in a basket of stocks or sectors at once. While ETF options are still limited in Nigeria, they’re growing and often come with low expense ratios (usually <1% annually).
- REITs (Real Estate Investment Trusts):- For those interested in real estate, REITs listed on the NGX allow you to earn rental and capital income without owning physical property.
- Mutual Funds:- These pooled investment vehicles are managed by professionals. Depending on the fund type, they may hold stocks, bonds, or a mix of both. Check for management fees (usually 1–2.5% annually) and performance history.
Tip: Before investing, compare platforms and products on things like:
1. Minimum investment
2. Fees and commissions
3. Licensing and regulation
4. Support and education tools
Cowrywise, for example, is licensed by the SEC and provides access to NGX stocks, mutual funds, and expert-curated bundles.
What You Should Know Before You Start
Before jumping into any investment, especially in a rising market, make sure to check off these key principles:
- Have an Emergency Fund
You should have 3–6 months of living expenses saved in a highly liquid account before investing. - Understand Diversification
Avoid putting all your money in one stock or sector. Diversify across industries to manage risk. Mutual funds, ETFs, and curated stock bundles help with this. - Practice Dollar-Cost Averaging
Instead of investing a large sum all at once, invest smaller amounts regularly. This helps smooth out volatility. - Align With Your Financial Goals
Are you investing for retirement? School fees? A house? Your timeline and goals should influence your risk tolerance and investment choices.
Is a Market Crash Coming?
Some analysts believe the recent rally may lead to a “correction”, a short-term dip to reset prices after months of steep gains. This is normal in investing.
But here’s what matters: Trying to predict market highs and lows usually backfires. Instead, stay consistent and think long-term. Long-term investors don’t panic during corrections. They stay consistent, diversified, and aligned with their goals.
How to Start Investing Responsibly
You don’t need to pick the perfect stock or time the market. Instead, focus on building good habits:
Step 1: Choose a Regulated Platform
Use trusted, SEC-licensed platforms like Cowrywise.
Step 2: Start Small and Regular
Automate monthly contributions, even if it’s just ₦5,000. That’s how consistent growth starts.
Step 3: Learn Along the Way
Use Cowrywise’s resources, read about the companies you invest in, and keep track of how markets work.
Final Takeaway
Nigeria’s stock market is having a historic run, but smart investing is never about chasing hype.
Start with your goals, diversify your portfolio, and use platforms that are transparent, regulated, and beginner-friendly. Whether you’re just starting or looking to expand your investments, make discipline, education, and risk management your guiding principles.
