Investing Foundations
Understand why nominal: the number on the statement.
10
Lessons in this module
Inflation eats savings
Understand why nominal: the number on the statement.
Real vs nominal returns
Understand why getting richer means being able to buy more.
What investing actually means
Understand why investing = deploying capital into risk assets expecting growth.
Time and rate are everything
Understand why you cannot control market returns — but you control when you start.
Your greatest asset: youth
Understand why youth = time = compound growth cycles.
What risk means in investing
Understand why investment risk = uncertainty of returns.
Types of risk
Understand why four key risks: (1) Market risk — systematic price movements affect all investments (NGX bear market affects most stocks), (2) Inflation risk — Nigeria's high inflation can erode real returns on low-yielding assets, (3) Currency risk — naira volatility affects foreign-currency assets, (4) Credit risk — bond issuer default (e.
Personal risk tolerance
Understand why risk tolerance mismatch is a major cause of poor investment outcomes.
Diversification basics
Understand why diversification targets unsystematic risk — the risk specific to one company or sector.
Risk-return spectrum
Understand why the risk premium: rational investors only accept higher risk if compensated by higher expected return.
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