03/12/2025
Someone recently asked me: “How do I start investing in the Nairobi Stock Exchange — and how do I actually make money from it?”
It’s a good question, because most people think investing in shares is only for the rich or for people in suits, living in Karen, owning big businesses and driving big cars.
I have noted that many Kenyans today want to learn how to invest in the stock market but don’t know where to start. The good news is that investing in the Nairobi Stock Exchange (NSE) is simpler and more accessible than most people think. All you need is a smartphone, an internet connection, and a small starting capital.
What then do you need to do?
Step 1: Open a CDS Account
Before buying any shares, you need a Central Depository System (CDS) account. This account safely holds your shares in digital form — like a bank account for your investments. You can open one through a licensed stockbroker such as Faida Investment Bank, AIB-AXYS Africa, Kestrel Capital, Dyer & Blair Investment Bank, or Suntra Investment Bank.
You will need your ID, KRA PIN, and proof of address. Most brokers now allow you to open an account online within a few minutes.
Step 2: Fund Your Account and Start Buying Shares
Once your account is ready, deposit money into it. The smallest unit you can buy on the NSE is 100 shares (one lot).
For example:
If a company’s share costs Ksh 20, you need Ksh 2,000 to buy the minimum 100 shares.
Your broker will charge a small commission (between 1.5% and 2.1%).
You can then choose which company to invest in — either through your broker’s app or by calling them directly.
It’s important to note that Historically, the Nairobi Securities Exchange required a minimum purchase of 100 shares, known as a "board lot".

But effective August 8, 2025, the Nairobi Securities Exchange (NSE) has removed the 100-share minimum to allow the purchase of single shares, making it cheaper to start investing.
To estimate the minimum cost for 100 shares of Safaricom, if the price is Kshs. 24.95 per share, you would calculate as follows:
Cost of shares: 24.95x 100 = Kshs. 2,495/-
Estimated trading fees: 2.1% x 2,495 = Kshs. 52.40
Total min. investment: 2,495 + 52.40= Kshs. 2,547.40
So to buy 100 shares of Safaricom you will need Kshs. 2,547. Kshs. 2,495 is the cost is the shares while Kshs. 52.40 is what you pay the broker who is buying for you the shares.
Step 3: Choose the Right Companies
If you’re just starting, go for blue-chip companies — the big, stable firms that have a track record of growth and consistent dividends.
Examples include:
✅ Safaricom – strong profits and regular dividends.
✅ Equity Bank – one of the most innovative banks in Africa.
✅ KCB Group – pays good dividends and has long-term growth potential.
✅ EABL (East African Breweries Ltd) – a solid performer in the manufacturing sector.
These are the kinds of companies that build wealth slowly but steadily.
Step 4: How You Actually Make Money
There are two main ways to earn money from shares:
✅ Dividends: This is the profit a company shares with its investors — usually once or twice a year.
For example, if you own 1,000 shares in KCB and they pay Ksh 2 per share in dividends, you’ll receive Ksh 2,000 directly into your account.
✅ Capital Gains: This is when the value of your shares goes up, and you sell them for a profit.
Example:
If you buy Safaricom shares at Ksh 25 and sell later at Ksh 35, you make a Ksh 10 profit per share. For 1,000 shares, that’s Ksh 10,000 profit.
Step 5: Think Long-Term
The stock market is not for gamblers — it rewards patience. The key is to buy good companies, hold them long enough, and let compounding do its work. Reinvest your dividends and watch your portfolio grow over time.
If you want daily income, consider money market funds, but for long-term wealth, stocks are king.
In short, you don’t need a suit and a briefcase to invest — just the right information and the courage to start small. Because every great investor, from Warren Buffett to the average Kenyan on the NSE, started with that first share purchase.
So all you need is you phone and Kshs. 100 bob and you are set to go.
Find a list of some of the stock brokers. You can contact them and they will help you oped a CDS account for FREE!
