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How To Invest In Ghana Stock Exchange

How To Invest In Ghana Stock Exchange

The stock exchange is a place where securities of all types are traded openly. It is a market for existing securities and not new ones. It is a place where people can gain or lose substantial sum of money quickly through good or false judgment. As a beginner, I’ll advise that you only invest monies that you can afford to lose. This way you won’t have to worry about losing your money. In this article, I’ll walk you through on how to invest in Ghana stock exchange as a beginner. I’ll teach you how to buy stocks and also give you a list of the top 10 best stocks in the market. So let’s start.

How To Invest In Ghana Stock Exchange

  • # Stock Brokers

As an individual, you cannot trade directly on the stock exchange. That is, you can not go to the stock exchange and buy or sell stocks directly. You must get a representative company who will carry out all your transactions and documentation. This company will buy or sell your stocks on your orders. They are called Brokerage firm. To be able to trade on the Ghana Stock Exchange you must open an account with a brokerage firm. So I collected some list of the best brokerage firms in Ghana for you. Feel free to search for other ones if you are not satisfied with these ones. You can search online for them. But here are the top four firms I’ll recommend in this article

How To Invest In Ghana Stock Exchange

How To Invest In Ghana Stock Exchange

Top 4 Brokerage Firms In Ghana

  1. African Alliance Securities Ghana [ http://www.africanalliance.com/ ]
  2. CAL Brokers [ http://www.calbrokersghana.com/ ]
  3. FirstBanc Brokerage Services [ http://www.firstbancgroup.com/ ]
  4. Stanbic Bank Ghana Brokerage [ http://www.stanbicbank.com.gh/ ]

You can decide to go with these ones or try other ones but before you create an account with any broker and before giving them your money ensure that they are listed on the Ghana stock exchange and trusted.

  • # Trading Cost

Trading Cost is the money you pay stockbrokers for their services. Most Ghanaian brokers will charge you commissions and fees of about 2.5% of the total transaction value.

  • # Opening a Ghanaian Brokerage Account

Now that we have handled the issue about trading cost, let’s see how you can open a Brokerage account.

# Step 1: Get and complete the Brokerage account opening form

The first step in opening a Brokerage account is obtaining the account opening form from the broker of your choice and filling it with the necessary information. You’ll need either your passport or ID number, house address and bank account details to complete the form. Most brokers have their account opening form online and you can easily download and print it.

# Step 2: Complete and Return the GSE Securities Depository Account Registration Form

The GSE Securities Depository Account is an electronic account that shows the various owners of securities in the stock exchange. Thus there’s no need for one to possess hard copy certificates. You can easily open the depository account by downloading and filling this form [here’s the link to download the form [ http://www.firstbancgroup.com/privatecontent/public/File/forms/Investor%20Service%20Account%20-%20Individuals%201c.pdf ]
and then return it to your broker. After this, you will be given a unique Ghana Securities Depository (GSD) account number. The unique account number that you will receive will accompany every trade order you place. This will help the GSD to keep a track record of all your stock holdings in the Ghana Stock Exchange.

# Step 3: mail your a Certified Copy of Your Passport and an Additional Passport-sized Photo.

Some brokers will accept your driver’s license in place of a passport if you don’t have one

# Step 4. Send a Canceled Check or Copy of a Recent Bank Statement

This is to ensure that you are the owner of the bank account that will be used for sending and receiving funds for your trade.

# Step 5: Wire Funds to Your Brokerage Account

At this stage, you’ve completed opening your Brokerage account and are ready to start buying and selling stocks. However, you must fund your account before your broker can buy stocks for you. After opening your account with the broker, the broker will provide you with their bank account details. You can easily fund this account via wire transfer. If you don’t know how to do this, you can contact your local bank directly to get help.

# Step 7: Submit a Trade Order

So you now have your brokers account funded. The next step is to submit your trade order to your broker. The trade order is a series of instructions telling your broker the stock to buy or sell on your behalf in the stock exchange. While some brokers will request a signed trade mandate form from you as a trade order, for most brokers, all you need to do is send an email to your broker with your trade instructions.

Still on How To Invest In Ghana Stock Exchange …

After receiving your trade order your broker will then execute your order and send you a contract note that reflects the buy or sell price as well as any commissions, and fees charged. The Settlement of stocks in the Ghanaian stock exchange takes three days, so if you’ve sold shares, don’t expect to receive the proceeds of a sale before then unless you’re willing to incur a penalty to settle the trade more quickly.

# Best Performing Stocks on The GSE

While I’ve tried to provide you with a list of some best-performing stocks on the GSE, it is not guaranteed that you will be secure by investing in them. The stock market is an unpredictable market. It can change at any time. That is why I’ll advise you that you carry out proper research before buying any stock. And above all, as a beginner ensure you only buy stocks with the money you can afford to lose.

 

# A Note on Dividends

Dividends are the return on your investment in the stock exchange. Collecting your dividends from the Ghana Stock Exchange is very easy. After opening your account, simply write an instruction to your broker that you would like all dividends paid on your stocks to be paid directly into your trading account.

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Updated: October 30, 2017 — 10:47 am

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