Question:
Sir,
I stumbled on Investdata News website yesterday, I must confess, some of the articles and analysis were very eye-opening.
Sir, I bought Forte Oil at N76 this (past) week, with all my savings, please should I stay or run. If you advice that I stay, what is the best exit price?
Musbau Adekunle,
Kaduna

Musbau,
Thank you for you kind words, however, I will advise that next time you wish to make investment, never use all of your savings again. Instead, always invest part of your savings, knowing that investments can go bad, in which case you lose part, or all of your investment when the investment tide goes against your expectation. In the same way, it can be a fantastic investment decisions for which you are rewarded handsomely.
It is important you know this because equity investment is all about risk and reward, following which you must know certain things and by so doing, ensure that your risk becomes calculated, rather than being just for the sake of taking it. One of such things you must do, I believe, is having a set goal or objective before deciding to take a risk with your savings.
To your particular investment in Forte Oil at N76 per share, the same week the stock closed N2 lower. My honest advise is that you hold for the medium-term to watch the stock and indeed, the general market trend and then determine the next action best suited for you- whether to exit at the end of that time or stay.
This advice is based on the fact that FO’s fundamental or earnings power on quarterly basis last year was weak, following which you and other investors in the stock should wait for the expected corporate announcement and the possibility of dividend payment. Be warned beforehand however, that going by the weak quarterly numbers already received, except a miracle took place between October and December last year, the audited results being expected might not support an automatic and fantastic jump in its share price.
One must however be quick to add that all hope is not lost, because talking technically, the stock is showing signs of recovering with a BUYING position of 100% and selling position at 0%, suggesting that it is on demand.

(Ambrose Omordion)