NGX Penny Stocks Set to Soar Again This September: Top Affordable Picks for Retail Investors

As of August 2025, investors who placed N1 million on Nigeria’s penny stocks at the start of the year could have doubled or even quintupled their money. Companies like Mutual Benefits Assurance, ABC Transport, Smart Products, AIICO Insurance, McNichols Plc, Sovereign Trust Insurance, and Royal Exchange delivered impressive gains, turning modest investments into between N2 million and N5 million. Out of 43 low-priced stocks trading under N5, 29 have outpaced inflation, offering real returns, while 26 have outperformed the broader market index, which rose 36% year-to-date.

The main attraction of penny stocks lies in their affordability. With blue-chip shares moving beyond the reach of many retail investors and inflation affecting purchasing power, these “tiny tickers” allow small investors to dream big. Digital trading platforms and sub-brokers have further lowered entry barriers, enabling anyone with a smartphone and as little as N100 to participate in the NGX. A N5,000 stake, for example, can yield thousands of shares, attracting a younger, tech-savvy generation of traders.

However, the high reward potential comes with equally high risks. Penny stocks often suffer from thin liquidity, limited analyst coverage, and sharp price swings. Experts caution investors to focus on fundamentals—profitability, dividend history, and trading volume—rather than following market sentiment alone. Without these factors, even the most promising rallies can collapse, leaving investors exposed.

For September, certain penny stocks stand out as both affordable and fundamentally sound. Mutual Benefits Assurance leads the pack with a 485% gain year-to-date, strong liquidity, and H1 2025 profits up 374%. Universal Insurance, Linkage Assurance, and AIICO Insurance also offer a balanced combination of affordability, profitability, and trading activity, making them attractive options for investors willing to take calculated risks.

Yet not all penny stock rallies are built the same. Companies like Smart Products Nigeria, Chams Holdings, and Regency Alliance have shown strong price moves, but thin trading volumes and declining profits raise concerns about sustainability. The key lesson for investors is clear: while penny stocks can deliver exceptional returns, focusing on liquidity, fundamentals, and proven profitability is essential to separate genuine opportunities from speculative hype.

Source: Nairametrics