"The start of a new year is more than a calendar change—it’s a chance to rewrite your financial story."
2025 is here, and with it comes the opportunity to take control of your finances. At InvestNaija, we have prepared a carefully curated mix of investments within Chapel Hill Denham product offerings to help you navigate your financial journey in Nigeria’s unique economic landscape.
Whether new to investing or ready to level up, this guide is your roadmap to financial independence.
The Economic Landscape of 2025: What It Means for You
- Inflation and the Cost of Living
Nigeria’s inflation rate soared to 34.6% in late 2024, driven by rising food and fuel costs. According to the National Bureau of Statistics (NBS), the Federal Government plans to rebase the Consumer Price Index (CPI) and Gross Domestic Product (GDP) at the end of January. This will reflect a clearer picture of economic realities and potentially boost investor confidence.
Implications for Investors:
- A more accurate CPI and GDP can guide better investment decisions.
- Highlighting emerging growth sectors offers new investment opportunities.
Investment Tip: Diversify into assets like equities that outpace inflation, safeguarding your purchasing power. Equity mutual funds like the Chapel Hill Denham Paramount Fund (Equity) aim to provide capital appreciation over the long term. The Fund returned 16% in Q4 2024 outperforming Consumer Price Index (CPI) at 5.4% in the same period.
- Interest Rates and Borrowing Costs
With the Monetary Policy Rate (MPR) at 27.5%, borrowing remains expensive, which also means higher yields for money market and bond investors.
Implications for Investors:
- Bonds provide steady returns in a high-rate environment.
- As rates eventually fall, bond values may appreciate, offering potential capital gains.
Investment Tip: InvestIN on InvestNaija offers individuals looking to begin their investment journey with a diverse selection of high-quality mutual funds, requiring a minimum investment of just N5,000. One notable option is the Chapel Hill Denham Money Market Fund, which focuses on preserving capital while delivering a consistent income stream to investors. As of Q4 2024, this fund reported a net yield of 19.67%, highlighting its potential for attractive returns.
- Currency Volatility
The Naira’s depreciation against the dollar creates significant uncertainty in the financial market, making it difficult for investors to plan. This currency volatility can lead to increased cost of living and doing business, further straining the economy.
Investment Tip: Include dollar-denominated funds like the Chapel Hill Denham Nigeria Dollar Income Fund (NDIF) to hedge against currency risks and access global growth opportunities. For 2024 year-to-date (YTD), the fund returned 11.6%.
The Power of Diversification
A well-diversified portfolio is key to achieving an optimal balance between risk and reward. The investment mix we'll outline below clearly illustrates this important strategy.
- Equities: Growth with Sectoral Opportunities
Equities should account for a significant portion of your investment portfolio if you have the appetite for risk. Sectors like Banks, Insurance, Consumer goods and Industrial goods are poised for growth, driven by regulatory changes, rising spending, and infrastructure developments.
- Bonds: Stability with Yield
Bonds provide a reliable stream of income and serve as a haven when the market gets shaky. They are a smart choice for those looking to weather financial storms while enjoying stability in their portfolios.
- Dollar-Based Investments: A Hedge Against Inflation
Dollar-denominated assets provide stability and shield your portfolio from local currency risks.
Why Diversification Works:
- Mitigates risk by spreading investments across asset classes.
- Balances high-growth equities with stable bonds and dollar assets.
Steps to Get Started: Your 2025 Investment Journey
- Download the InvestNaija App from the Apple App Store or Google Play Store.
- Sign Up by creating an account.
- Complete Your KYC process for a secure and verified profile.
- Explore the InvestIN Section for:
- Mutual Funds: Choose from professionally managed funds by Chapel Hill Denham.
- TradeIN: Access the Nigerian stock exchange and start trading NGX listed stocks.
- FGN Savings Bond: Subscribe to the monthly issued FGN Savings Bond to earn attractive quarterly coupons.
- Start Investing with as little as ₦5,000.
Looking Ahead: Make 2025 Your Year of Financial Wins
Starting strong is only the beginning. To ensure 2025 is your best financial year yet:
- Review Regularly: Monitor your progress and adjust quarterly.
- Embrace New Opportunities: Look for emerging sectors and new funds.
- Learn Continuously: Use our LearnIN platform for financial education tools.
- Stay Consistent: Automate savings and investments using SaveIN and PlanIN.
Embrace the opportunities of 2025 and take charge of your financial future today.
