Retail Investor’s perspective
IN this week’s section of profiling the Zimbabwe Stock Exchange (ZSE) retail investors, we feature Michael Nyamande.
ZSE Retail Investor
Name: Michael Nyamande
Age: 26 years
Profession: Software Engineer specializing in Web and Mobile Apps.
Hobbies: Runs a technical blog codebytes. co.zw, a bibliophile who collects more books than he can read and a Zim dancehall lover.
Aspiration: His dream is to one day establish a startup incubator in Zimbabwe, which will help create local digital solutions with a global impact.
Michael Nyamande is a ZSE retail investor whose interest in investing started in 2020.
The Investment Journey
When Michael started working, he realized that his income was not going to cater for his future goals such as buying a car, owning a house and taking care of his parents. Michael started looking for projects to generate additional income. The side hustles he attempted were exhausting, making it difficult to balance it with his work as the market was very volatile. Michael then found out about the Zimbabwe Stock Exchange, which allowed him to invest in the local currency. He was particularly intrigued by the presence of circuit breakers which help in reducing extreme market volatility. The ZSE also has a great community from online investors who share the investment tips, to the friendly ZSE staff who are always ready to assist whenever one has an issue.
The Investment Strategy
When Investing on the ZSE, Michael adopts a strategy of keeping his ear to the ground. He is part of several groups and communities on Whatsapp, Twitter and Telegram that discuss investments. Michael is not a fan of technical analysis, and has found that monitoring sentiments amongst other investors and learning from experts gives him unique insights. Michael sets time weekly to read analysis by different stockbrokers and asset managers on stocks. Through such analysis, he is able to better draw up his own opinions on which stocks to invest.
Michael structures his investments as follows;
◆ Keeps 50% of his portfolio in blue chip coun
ters as these are good for preserving value in
the long term and normally pays dividends. ◆ Around 30% is for growth stock companies that he believes are expanding and that will grow faster than the average return.
◆ 20% is reserved for new listings which normally give good quick returns and companies due to make announcements. Michael’s portfolio includes a mix of different counters in different sectors such as Consumer Staples, ICT, Consumer Discretionary and Exchange Traded Funds.
Highlights and lows of the investment journey
Michaels’ favorite part of his investment journey has been convincing his friends and family to start investing and the excitement that follows when their stocks appreciate or when they get dividends.
“It is always great to watch a new person start investing, and see them realize that most of the myths they had around investing are not true. Investing is not only for the rich, it is not complicated and anyone can start investing no matter how young or old.”
A low point in his investment journey was when Michael realized that the stock market operates in cycles with high and low seasons. After enjoying a good period of his stocks increasing in value, there was a point when the market shifted, with his stocks losing value. An important lesson Michael learnt during that period is to always rebalance and readjust his portfolio after any significant movement in the market. Michael also learnt that it is important to enjoy his profits after a bull run as long as he re-invests a portion.
Advice to Prospective Investors
“Everything seems difficult until one starts. The investment journey might seem complicated or scary but it’s worthwhile. It will help you create generational wealth in the long term, but more importantly an extra income stream. Technology has democratized access to wealth, where one can now trade from anywhere, with a host of tools to help one select the right stocks, and vast online communities to assist investors. All of this is for free, it’s up to you to take advantage of it. Start investing today!”
Information provided in this article is for educational purposes and does not constitute financial advice. You should obtain independent advice from a Registered Stockbroker or Financial Advisor before making any financial decisions.
◆ For more information about how to invest on the ZSE, visit the ZSE training portal www. zsetraining. co. zw, email info@zse.co.zw, Tel: +263 24 2886830-5