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Step 1
Decide whether you want to trade individual stocks, African ETFs (exchange-traded funds) or other African indices. For many beginners in overseas investing, one place to start is immersing yourself in the different indices in the market you are considering. They mirror some of the strongest stocks in those markets just like the Dow Industrial Average, S & P 500 and NASDAQ 100. Two examples are the Africa ETF (AFK) and the Dow Jones Africa Titans 50 Index (DJAFK). See links in Eesources below for more on African indices and ETFs.
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Step 2
Pick an online brokerage based on your decision above. If you plan on investing in indices and ETFs, you have a larger pool of brokerages to choose from than if you want to trade in individual Nigerian stocks. There are a variety of online brokerage firms that offer online trading for a nominal fee. They charge a monthly fee and an additional amount ranging from $3 to $20 for individual trades. Some, like Sharebuilder, allow you to make monthly investments automatically for a specified number of trades with no minimum amounts for a fixed monthly fee.
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Step 3
In you plan on trading individual Nigerian stocks you are better off opening a brokerage account that allows you to do so directly. Some brokerages may require you to submit a special application to buy foreign stocks. One brokerage, Euro Pacific, allows you to trade in foreign stocks directly. Find the link to Euro Pacific in the Resources section.
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Step 4
Contact the stock brokerage firms in Nigeria. An alternative way is to contact the stockbrokers who are on the ground in Nigeria who monitor the Nigerian stock market constantly. See a link in Resources below to the Nigerian stock exchange where you can find the contact information for the stock brokerage firms (issuing houses) authorized to buy and sell stock in Nigeria.
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Step 5
Open your brokerage account and link it to your checking account. This allows you transfer the necessary funds and start investing.
