By Babajide Komolafe

We have dedicated the last eight editions of this column to satisfying the yearnings for many Nigerians on knowledge about investment in mutual funds, treasury bills, and commercial papers.

For first followers of this column, you can access previous editions by visiting https://allure.vanguardngr.com/category/happiness/career/.

Each of these investment types has its own benefits and shortcomings and it is important to know this.

To invest in a Commercial paper requires that you have a minimum of N5 million that you won’t need for at least 180 days (6 months). Hence it is not for people that want the same small money on a regular basis.

Also because they offer high interest rates, demand for Commercial papers, CPs, is very high. This reduces the prospect that your offer will be successful. Imagine a scenario where the CP on offer is N50 billion while bid from investors is about N200 billion.

Most times, the CP on offer is rationed to investors.
To invest in Treasury bills, TBs, requires a lower minimum amount, N10,000. The minimum investment period is 90 days (three months). Also because TBs offer higher interest rates, demand always exceeds the amount on offer.
For example, the CBN conducted a TB auction on Tuesday October 8th, 2025; total subscriptions demand for the 364 Days TB from investors was N986.33 billion. However, the total successful bids was N503.298 billion.

This means about N483 billion of the bids were not successful. Thus the probability of success for your bids is about 60%.

Notwithstanding this challenge, the money you choose to invest in Treasury Bills, TBs, or Commercial Papers, CPs, should be funds you are not likely to need for a long period. For example, if you receive a significant sum of money and you want to make it difficult to access and spend that money for six months or more, you can choose to invest it in CPs or TBs. However, if it is money you may need at any time, CPs or TBs are not advisable investment options.

For instance, if your wife is pregnant and in the first week of the pregnancy you receive a lump sum of N500,000, and both of you decide to save the money for delivery and naming expenses, you can invest it in a TB that will mature in six to eight months. Once that TB matures and you receive the proceeds, you should not reinvest it in another TB. Instead, you should keep it in your savings account or, preferably, in a money market mutual fund.