TradeFi (“the Platform”) is the latest disruptive and innovative mobile (and web) application which enables individuals invest in Federal Government of Nigeria Bonds (FGN) and Treasury Bills directly from their phone, laptop or tablet.
TradeFi affords retail investors the opportunity of understanding what fixed income securities are, as well as enabling them take advantage of the asset class to grow their wealth. That’s a golden opportunity for Nigerians, most of whom do not have an inkling of fixed income market dynamics.
“An average Nigerian investor sees fixed income as a myth, failing to comprehend how it works,” highlighted during an interview with Tosin Osunkoya, Managing Director, and Comercio Partners Asset Management.
Leveraging on technology, Comercio Partners Asset Management, through TradeFi, provides the investor the opportunity to exploit the benefits of the fixed income market with risk averse investment options with higher return than inflation. In addition, TradeFi would be used as a medium to demystify the dynamics in the fixed income to enlighten the investing public with the basic knowledge of these investment options.
Investors have the free will to decide their investment horizon from a range of two weeks (14 days) to 20 years on the platform based on their investment goals. It is instructive to note that the platform allows investors to terminate their investments at any time during the life of the investment
Furthermore, TradeFi offers competitive returns higher than a savings or regular fixed deposit account which affords an interest rate of about 3% and 7% per annum, respectively. Fixed income securities, i.e. FGN bonds and Treasury bills provide superior returns between 10 – 14% (currently) depending on the tenor of the investment.
When inflation (11.22% in June 2019 according to data by the National Bureau of Statistics) is factored in, an investor who has cash in a savings or fixed deposit account, is in fact effectively making negative real returns between 4% and 8% respectively. For treasury bills and FGN Bonds however, there is a real return between 1 – 4% depending on the tenor of the investment chosen.