MERISTEM Securities Limited has just launched a new trading platform which it calls ‘Nigeria’s first naira multi derivative assets platform,’ or MeriFX.
According to Meristem, with MeriFX “you can now trade Forex, Commodities, Indices and Equities all from one trading account in Naira. MeriFX offers you the chance to trade the world’s most popular financial markets at your fingertips.”
The fact is that customers are not really trading (buying or selling) anything that you can own, but merely engaging in something called ‘spread trading’.
Unlike stocks whereby you own a piece of a company when you buy, when you spread bet, you are only speculating on the price movements of thousands of global financial markets including indices, shares, currencies, commodities and more.
You can use spread trade to speculate on price movements irrespective of whether the markets are rising or falling.
If you go long (buy), your profits will rise in line with any increase in that price. If you go short (sell), your profits will rise in line with any fall.
Similarly, if you go long on the price and the underlying stock price falls, you will incur losses.
Another risk for untested traders is the huge leverage involved in spread trading meaning the market doesn’t have to move against you by much to wipe you out.
‘’The minimum trade size on MeriFX is N50, 000. We at Nairametrics believe in innovation and applaud Meristem for bringing MeriFX to Nigerian traders’’.
Meristem Securities Limited had in 2014 inaugurated an online stock trading platform aimed at fostering market participation.
According to the firm, the platform, called Meritrade, serve as a virtual stockbroking platform, helping users to always trade stocks on the Nigerian Stock Exchange from anywhere in the world through their computers or mobile phones.
The Chief Executive Officer, NSE, Mr. Oscar Onyema, said Meritrade was an innovation, which was in line with the Exchange’s strategy for developing and protecting the Nigerian capital market.
Onyema said, apart from providing a convenient mode of trading equities, the online platform, Meritrade, would encourage more people to participate in the stock market.
“This position is rooted on the realisation that the securities industry is largely powered by technology,” he said.
Onyema, who said the NSE had mentioned over time that mobile and online trading were part of the next wave in its market development efforts, added that the new platform would play a vital role in the process.
He said, “Distinguished guests, the Meritrade platform being launched in 2014 has been demonstrated as one that provides speed, accessibility and robustness of technology systems…all critical success factors of modern trading where key industry trends embrace mobile/e-Trading and new technology-enabled trading models amongst other realities.”
The Managing Director, Meristem Securities, Mr. Oluwole Abegunde, explained that the innovation would offer investors control and convenience over their investments.
Abegunde, who recalled the experience stockbrokers had in the early 90s when trading was done manually, stressed that the new platform would take automated trading steps further.
He said, “The Meritrade app will always give users a unique experience, convenience and control over their investments. Our customers can always trade and manage their investments 24 hours daily, with their mobile devices without having to come to our office.”