Mr. Odusote smiled. “Who says these investors and customers don‘t want to become wealthy fast? These people understand that every investment carries some risk and the potential to earn is directly linked to the degree of risk. What is vital is to ensure that we earn positive real rate of returns in the face of inflation. What I propose has the potential to achieve this.”
“But at what cost? With a negative track record, the plan will crumble,” Odili rejoined.
Mr. Okereke jumped into the conversation again. “How do you intend to minimize risks? You write here…” he pointed to the proposal, “…that you‘ll keep your total account value at a maximum and grow it? I‘m not convinced by what you‘ve told us so far.”
“Look, I‘ve been doing this a long time…”
“You‘ve never operated on this level before. Also I‘ve been in this market even longer than you…”
“There are several money and trading risk management techniques I can use, but it depends on how much funds your company is willing to give me and autonomy to trade all or nothing. The credit line will ensure the extra cash is always available in the trading account…”
“You think this is enough to justify taking margin loans?” Mrs. Olayomi asked.
Edward noted the skepticism in her voice. Margins were a very useful tool for trading; they gave extra buying power and could be the edge that propelled a dealer to the top. However, they could be very risky if not used properly which meant that some traders did not use them at all. He also didn‘t want to lose sight of the fact that this was the Nigerian banking system they were talking about. With all the reforms going on, the banks were very undependable. Anything could happen and they would want their money back. He wasn‘t going to risk it.
“Mr. Odusote thanks for the opportunity to talk more about this proposal. We need more time to study all the points you‘ve made before a final decision.” He stood and moved forward.
The broker stood too and they shook hands. “Thanks for inviting me. I believe we have a potential partnership ahead of us but I‘ve sent this proposal to some other firms and…”
“Of course...” Edward moved to the door with him.
After closing the door after Mr. Odusote, he came back into the room to discuss with his team further.