Money Market vs Capital Market (Understanding the difference)

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The past few weeks have been quite interesting as far as IPOs and stock listings go. 

The drama started with the fraud allegations against Jumia which led to the company getting sued with a class action suit. (still an unfolding story,,)

and continued with MTN Nigeria (MTNN) finally getting listed by introduction on the Nigerian Stock Exchange (NSE) this week. (to learn the difference between a listing by introduction and an Initial Public Offer (IPO) click here)

The Securities Exchange Commission (SEC) announced MTNN shares were going to get listed on the NSE at N90 per share.

However, so far, nobody has successfully purchased MTNN shares at N90

MTNN shares closed at N99 on Thursday, May 16th, the day it opened on the stock exchange

and closed at N108.9, yesterday Friday, May 17th, 2019. There were reports of a quick sale at N125 per share for $5m yesterday.

While we wait to see what unfolds next week, analysts estimate a price point over N150 in the coming week. 

MTNN is a great stock and that's why there's a lot of interest in buying the stock. The company boasts of N1 trillion in annualized revenue in 2018, 90% return on equity and 80% dividend payout rate. 

If all of this sound like gibberish to you, I understand. It used to sound that way to me as well. 

This week, I'm sharing some basic knowledge on the difference between the money market and capital market. This will help you gain an understanding of the following;

1. The difference between the money market and the capital market
2. The different underlying markets in the capital market
3. The minimum investment required to invest in either market
4. The risk associated with each market

Click on the image to watch and leave your questions in the comment section

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