A statistical floor for nominal gains

A statistical floor for nominal gains.

Splitbox Journal • Decision Journal

Price and conviction are diverging.

Situation The Nigerian stock market gained N28.65 billion on Tuesday. This 0.02 percent rise in the All-Share Index recovered 81 percent of the previous session's losses. The index reached 254,289.35 points. The internal data tells a different story.

What we know Transaction value collapsed by 52.38 percent to N22.61 billion. Market breadth is negative. Thirty-two stocks fell while only twenty rose. Three heavyweights—International Breweries, Zenith Bank, and Access Corp—tilted the scale. The year-to-date return of 63.41 percent masks a shrinking exit door.

What we do not know We do not know if institutional sellers are finished or if they are simply trapped. A domestic enclosure creates a liquidity mirage. Price can rise while the ability to exit large positions vanishes.

What we would do Ignore the N28 billion gain. A 0.02 percent rise on half the previous day's volume is not a recovery. It is a lack of buyers meeting a total absence of sellers. Prioritize value traded over index points. In this market, liquidity is the only metric that matters for survival.

Price is an opinion, but volume is a fact.

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— Splitbox Journal