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A bear market is when there are continues fall in prices as we are

witnessing now.

We say universal law. These are laws that work whether you
know them or not or even have faith in them. You just have to
believe in these laws, as they will work all the time irrespective of
the country you are or who you are. Example of a universal law is
the force of gravity, no matter who you are, rich or poor if you jump
from a height you will fall down. Nigerian will remember the
Mobitel MD sometimes ago.

The following laws affect everybody and will work for you whether
you are black, white, brown, yellow on whichever continent you
are. Aligning yourself with these powerful tools will enable you to
achieve profit on your investments in this time of recession. There
are no sentiments if it is your money.

These laws are:

 Buy when the market is pessimistic, thus this is the time.

This period is a time that wealth is about to change hands.
As the people who has been affected by the “banking
tsunami” and the general falling price. This is the time for a
fresh investor and an unknown face to surface as the biggest
investor. I am sure we are going to see this within the next
one year.

 Investment is for long time. Just recently law of leverage

worked for some people. The Jimoh Ibrahims, Capital Oil
owners etc, now this law is working against these people
making them to incur huge losses to save their neck and one
person’s loss is profit for another. These people had to sell
their shares which were acquired with short term funds
borrowed from the banks. It is not advisable to do a long
term investment with short term funds from the financial
institutions except in rear cases where the capital market is
extremely bullish.

 Avoid Negative Sectors - As you know about the crises in

the banking sector, this sector and those related to it must be
avoided, except the companies involved are ready
exceptional, thus as at September 2009 you avoid:

i) Insurance Stocks
ii) Banking Stocks
iii) Automobile mobilies companies Goods, Transport and

iv) Leisure / Hotel. Leisure spending is first to be leasing


v) Airline – Depending on expensive equipments capital is

not available in developing countries thus airlines in
Nigeria, Ghana and other developing countries are
always collapsing.

 Invest only in large companies that have strong balance

sheet any one with capitalisation of less than billion should
be avoided. Low capitalisation companies be avoided also.

 Buy companies that have good dividend yield, but are

outside the industries that are in turbulence situation.

 Invest in companies with high and increasing net profit

margin. These are samples of margin as per the attached

2008 2007 REMARKS

 Management – Avoid companies where the management

is tainted by any shade of suspicious i.e. avoid ethics in high
standard for any bad result you hear the actual situation
many be worst.

 Company must have positive working capital. At this

instance there is no money. Therefore, the company must
have cash for development. Cost cutting is very essential.

 Buy shares in Defensive Sectors

i) Pharmaceuticals – Fidson
Sterling Pharmaceuticals
ii) Breweries - Nigerian Breweries
These companies always do well in downmarket
and are insensitive to market moments

iii) Conglomerate – Unilever

AG Leventis

 Avoid companies with highly cyclical business

Non Essentials
i) Automates (Assemble plants)
ii) Chemicals
iii) Transport
iv) Leisure & Entertainment
v) Software Services
vi) Media
Others to avoid - company needing high capital **
-Oil Companies and Oil Servicing Companies
-Stock market business related businesses
e.g Deap Capital Limted, Crusader


The purpose of Investment is not to look at what is going on today

but what is likely to happen tomorrow. It is all about anticipating
economic developments. If you want to wait till there is a
confirmation that economic recovery has fully taken place, then
you may miss the opportunities.

I encourage you to take the dive into the seemly shark invested
ocean capital market today and I am sure you will come out at the
other end, a victorious investor very soon. You can tell me your
testimony at
Next outlook for some Industrial Sectors the rest of 2009 and the
rest of 2009 and 1st half of 2009 for Nigerian and Ghana market.

Liz-olofin & Company Plc