“How to find Dollar investments for Nigerians” or “How to save in dollars on Cowrywise” is probably something you have searched for, or something similar. No, we do not have your search queries under watch but we are Nigerians as well. We get that you want investment options that help you expand your portfolio while giving you a chance to beat the recent inflation rate in Nigeria. Well, you’re in the right place. 😉
Dollar Investments for Nigerians
With Cowrywise, you can now access Dollar mutual funds: the United Capital Nigerian Eurobond Fund and the ARM Eurobond Fund.
Eurobond? What’s that? Isn’t it supposed to be a Dollar-based investment, how did Euro (£) enter?
Well, Eurobonds are still Dollar investments. I’ll explain how shortly, but first what are bonds?
What is a bond?
A bond is an agreement between two parties – like those old Nollywood movies where they make blood oaths to love themselves forever. 😫 Ok, ok. I’m kidding, a bond in investment isn’t a blood covenant but you get my point.
Party A borrows from Party B and agrees to pay back with a set interest rate. It is a loan that an investor lends to (typically) a corporate or governmental body. So, a government bond is simply the government borrowing money from the public with the agreement (i.e. bond) to pay back with a certain interest rate.
So, what are Eurobonds?
Eurobonds are bonds that are issued in international currencies – currencies different from the host country’s currency (in our case, currencies that are not Naira).
For example, the Nigerian government can issue a bond to foreign investors that allows them to lend the Nigerian government money in dollars, not Naira (since they don’t spend Naira in their country). 🌚
Eurobonds – How to save in dollars on Cowrywise the better way! 🤩
Eurobonds is like saving your money in dollars “in the hand” of companies or the government. They invest it and pay you your return in dollars.
What are Eurobond Funds? 💸
This is a type of mutual fund that invests in Dollar-denominated bonds. With this, you can lend the Nigerian government and companies dollars and get back your returns/interests in dollars.
Read more about mutual funds here
How to save in dollars on Cowrywise – How can you access the funds?
- You need to have the updated version of the Cowrywise app. If you are not a user, download the app here
- Click on the “Invest” tab, Click “Create a new investment”
- Take the risk assessment (optional). This is a short assessment that lets you know what type of investor you are – a low, medium or high-risk investor
- Tap “Dollar Mutual Funds” and invest in your preferred option
How to withdraw from the fund
- To withdraw from the fund anytime, tap “Invest”
- Select “USD Mutual Funds”
- Select the dollar investment plan you want to sell
- Tap the three dots at the top right corner
- Tap “Sell Units”
Bear this in mind, if you sell your units before the returns payout date, you’ll only gain if the price per unit has increased. This means that if you bought a unit at $10 and sell at $11, you’ve gained $1 per unit.
More important details
The Eurobond Fund is meant for long-term investments to grow and preserve the value of your investments. It is not fit for short-term investments that are below a year.
Also, there are two sources of returns when you invest in dollar assets like Eurobond with Naira:
- Returns/Interests. This is the return you get on your Eurobond investment. On Cowrywise, we show you the Year to Date (YTD) performance of the funds. This is the amount of profit/returns the investment has earned from Jan 1 of the current year till the current date. It is not a guarantee of what the eventual returns might be.
- Return from changes in the value of the Naira against the USD. This means that you gain additional returns as a Nigerian who has invested in Eurobonds if Naira loses value against the USD.
Here is a simple example to drive this point home:
It was 2019
You invested NGN360,000 with a return of 8% per annum. This is converted to USD1,000 at an exchange rate of 360 Naira per 1 USD.
It is 2022
If Naira loses its value against the USD, the exchange rate becomes NGN600 per USD. The USD1,000 you invested would have earned 8% over the first year: 8% x USD1,000 = USD80. This implies you had USD1,080 as the total value of your investment by 2020. The USD1,080 would also have earned 8% over the second year: 8% x USD1,080 = USD86.4. This implies you had USD1,166.4 as the total value of your investment by 2021. When you convert this value to Naira at the exchange rate of NGN600 per USD, this gives USD1,166.4 x 600 = NGN699,840.
Your total return in Naira = N339,840 or 94.4% of NGN360,000. 🤯
In simple terms, you have earned returns from two sources: the fixed return/interest on the Eurobond and the change in the value of the Naira to USD.
Finally
When investing, it is important to study previous trends as it can help you make better decisions to diversify your assets. With as low as $10 (the naira equivalent), you can start investing in the Eurobonds available for you on Cowrywise right now. The exchange rate is determined by the current market performance and Cowrywise almost always has better exchange rates for you. (Don’t tell anyone I told you that. 😉)
Get started with dollar investments today by downloading the Cowrywise app.
Already have the app? Log in and begin investing in dollar mutual funds now.
What if naira gain some percentage, will it affect the money invested?
If you convert the investment back to naira, at that point, yes. However, it works the other way round too. Finally, this doesn’t affect your returns.
The interest is gotten per month or how many months do i have to leave the money that has been invested
Please if I don’t have up 100USD, does it mean I can’t invest.
Not anymore. You can now invest with as low as $10
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I love this!!! I am definitely brilliant opportunity for retail investment. What is your take on Creating a Real estate funds ( focused on commercial and residential property development in Nigerian major cities)?
Trust me, Nigerians, home and abroad, are waiting to join on such opportunity to invest in a well-structured security that addresses not just documentation/regulatory issues, but also handled by real professionals.
Is it possible to invest to add to your investment on dollar mutual fund?
Yes, please.
How many is the minimum units I can withdraw?
0.5 Units
Can l continue to add to my investment monthly?
Yes, and you can do so automatically as well.
What is the naira equivalent of 0.5 units
Hello Ope…my question on the Eurobond. As @ today 20th November entry exchange rate 460 (buy rate) and exit/sell rate is 450..if at some point in a one year tenor…the rate increases..will the exit/sale rate also increase. I have a plan on cowrie already and want some capital preservation. Though i have noted from your platform that there is quite a significant rate difference between the sell/buy rate in addition to a processing fee that runs somewhat high
Hi Jay,
Yes, you also earn returns from changes in the value of the Naira against the USD. This means that you gain additional returns as a Nigerian who has invested in Eurobonds if Naira to USD increases.
However, it works the other way round too but this doesn’t affect your returns.
In what currency is the return paid?
It is currently paid in Naira. However, we’re actively working on an option that allows you receive your earnings in dollars.
How soon is soon? I had to discontinue my investment because of this.
Let’s talk about the Value of Naira itself. The Value of Naira in 2019 and 2021 is definitely different. What you could buy at N360,000 in 2019 probably cost that N540,000 in 2021 or even more. So basically you’ve just matched the value of the Naira which is not guaranteed as Inflation rate is about 30%. So we need investments that can match that rate o
How to get started via the app?
Hi Akpevwe,
In the app,
– Click on the “Actions” tab, Click “Invest in Mutual Funds”
– Tap “Dollar Mutual Funds” and invest in your preferred option
Pls how can I invest with my savings
My account was flagged and since then it has been rough for me
Please I need my account to be normal again
Hi Udochukwu, we’re working on it right away
Hi Udochukwu,
We’ve been trying to reach you.
Can you kindly send an email to support@cowrywise.com to rectify this?
Thanks!
Please… how long will my dollar mutual funds last before I can withdraw
I have a domiciliary accounts can I transfer to make investment like 20dollars
Ope is it possible to deposit dollar into my cowrywise stash
But my take is on; investment in dollars should get returns paid in dollars not the other way round
You get Dollar returns on your dollar investments.
Would you advice for mutual investment for a period of 3-5months?
I plan on investing monthly. Is $10 the least amount required for investing?
I wanted to save money since yesterday but is not going through
Is my dollar investment locked? How do I withdraw from it?
And hw long does it take to credit my stash after selling my unit on my dollar account
@Ope, I can’t find invest in mutual funds in my updated cowrywise app. Is the plan no longer there.
How long does it take for the money I invested in dollar mutual fund to reflect in my cowrywise app via bank transfer.
Is it possible to transfer from the normal savings On cowrywise to Dollar mutual funds?
Great read.
Amazing tips
Hey Ope,
Is it possible for me to withdraw my invested dollars into a dorm account upon maturity?