Many people invest in stocks but end up losing money because they don't study first. Nowadays, in what we so-called as the Technology or Information Age, people are slowly gaining the awareness about the value and benefits of stock investing. This is true to the fact that investors aged 18 to 44 comprised the bulk or 73.9% of online stock account users. Quoted from the Business Word University Edition November 5-18, 2015, Mr. Hans Sicat, PSE President and CEO, said that “The growth in online accounts continues to be impressive and validates our strategy of expanding the retail investor base through this platform.” He added, “Online accounts now compromise 27% of total stock market accounts from a mere 6% share in 2009.”
Worth noting indeed. However, despite the high returns one can get in stock investing, there is this big CAVEAT or warning also given the risks of losing, the fluctuations, the bearish periods, the heresies or hypes that can make your heart palpitate and your head go nuts. But do not fret for these things can be minimized if not totally avoided and here are some tips that you may consider:
1. Know Your Investment Goals/Objectives
It is important that one knows what his/her investment objectives are. These should be assessed carefully because it can help in the determination of what particular type of asset or fund would suit your reasons. Some of which may be any of the following:
a) Capital Preservation – This is considered as the conservative approach towards investing since the aim is to avoid risk of loss with the hope of gaining yields overtime;
b) Capital Appreciation – As the term implies, this objective deals with the accumulation or growth of capital. This may enable one to gain higher returns but note that there are higher risks too. The same goes with the investment adage, “the higher the risk, the higher is the return.”
c) Dividend Accumulation – The goal is to gain earnings through dividend declarations from companies or other business organizations, and
d) Current Income – This mode is to seek for the fastest yields to one’s investment. Said returns may not be extremely high but are just adequate to cover up for one’s regular expenses.
2. Research about the Stock Market
Of course, as any other important reminder, know what you are getting yourself into. From the Frequently Asked Question (FAQs) of Philippine Stock Exchange (PSE) Academy, stocks are shares of ownership in a company. When you buy stocks of a publicly listed company, you become part owner of that company. As a part owner, you participate in the company’s growth and future profits. Conversely, you may also lose if the company suffers a loss or performs below market expectations. Now what is a stock market? The stock market is a place where stocks are bought and sold or a place where people can invest in publicly listed companies through the Philippine Stock Exchange, Inc.
3. Determine Your Risk Appetite/Profile
Basically, one has to evaluate his/her levels of tolerance for losses. As what financial consultant and stock market trader, Mr. Marvin Germo, said “Your investment strategy should reflect on the stock you are buying.” He further explained that there are volatile stocks that have the great potential to go higher but also have the possibility to go down significantly. There are also stocks that are steadily growing while the market is going up and gets down steadily as the market turns otherwise. In order for one to identify his/her risk profile, he or she should attend trainings or seminars about stock trading. Another option is to watch training videos or read books to gain insightful knowledge and strategies.
4. Allocate Investible Funds in Stock Investing
In a nutshell, one must only invest funds that he or she can afford to lose in the stock market. Never go with your daily operational or living funds, or even pension funds in stock investing because the risk of losing is very real. Though losses in the stock market are considered “paper losses”, others can’t help but feel worried, especially for most newbies, since the funds they poured into the stock market are at times hard-earned money which can be used for other purposes. In addition, make sure that you have emergency funds and savings because there are no guarantees that there will be returns all the time.
5. Devote time for Stock Investing
They said that investing in stocks is much like going to school or a college course wherein the funds that you placed are your tuition fees for learning. In order for one to be successful in stock market or in schooling, he or she should commit time to study and be more aware of the mechanics of the market. Allocating time in stock investing does not necessarily mean that you have to watch how the market goes every minute in a trading day but you can set your own time in monitoring. The same can be done on a daily, weekly, monthly, quarterly basis, or whatever mode you are most convenient with. One can even align his/her monitoring time with his/her preferred strategy, be it long term (buy-and-forget), regular (peso-cost averaging) or short term (daily trading).
Truly, investing in the stock market is yet another means for building wealth. It is in one way or another that it can also alleviate poverty among our Filipino Kababayans given the proper knowledge and training. Noting that fear or ignorance immobilizes success, let us be informed, be engaged, and begin investing in the stock market. Cheers to investing!
Insular Life's brand endorser, Ms Lea Salonga has always believed that planning early in life can go a long way in helping you reach the bright future you want in life.
Today, we will discuss to you one of Insular Life's best selling investment products available in the market today - The Wealth Secure Investment.
Wealth Secure is a 3 in 1 investment program that provides the following:
1. Investment - the amount after 5 years of contribution can be withdrawn partially or fully
2. Life Insurance - the beneficiaries can receive a death benefit plus the unwithdrawn investment of the client
3. Health Insurance - the client can receive up to P5M lump sum should the client be diagnosed of any of the 35 dreaded diseases (ex. cancer, heart attack, stroke, kidney failure and major organ transplant).
FREQUENTLY ASKED QUESTIONS:
So much do you need to invest to receive the benefits above?
Simply invest at least Php 2,000 per month for at least 5 years or 10 years and you can receive the benefits above. You can invest also quarterly, semi-annual or annually.
How to start investing?
Simply contact us so we can schedule a meet with you. To contact us please contact an Insular Life Financial Advisor by clicking here. Or you may text us at 0905-FINANCE or 0905-3462623 for more information.
Why should you trust in Insular Life?
Insular Life is the largest insurance company in the Philippines in terms of Net Assets/Net Worth. To know more about Insular Life's standing versus other Insurance companies please visit www.financeph.com/blog/top-largest-life-insurance-companies-in-the-philippines-for-2016
How much is the expected return on investment?
It depends on the type of investment you choose from. You can choose from 5 different types of investment each with different expected returns and risks. The returns can range from 4%-25% per year on an average it is around 8-12% average return.
Contact us and we would be love to schedule a meeting with you and discuss your investment options.
To contact us please click here. Or you may text us at 0905-FINANCE or 0905-3462623 for more information.
Like our FB page to stay updated on the latest investments in the market and other interesting finance articles:
Investing gives us more than we could analyze, not just by receiving the fruits of our investment but also the non-financial benefits and values that makes us greater individuals for ourselves and our community.
Just like investing, there are several valuable lessons that we can learn over the course of our lives. Have you ever asked the following questions:
Why do we need to go to school when the things that we need to learn are in the internet?
In my opinion, we go to school not just only to learn and obtain knowledge but also to learn the value of perseverance. Each day is filled with challenges, home works, projects and extracurricular activities that at times can be hard to handle. But by waking up each day, we are in effect saying to ourselves that someday, all the hard work will be rewarded by that graduation toga. If we don’t persevere we won’t be able to graduate, it’s the same for investing: if we don’t persevere to learn investing, we won’t become successful investors.
Why do we have to learn complex mathematical computations when we don't really need it in real life?
Have you ever had times in college or high school where you thought, how can learning the surface area or the limit of x be useful in everyday life? Unless you are an engineer, college math may not be as useful in real life at all. But the act of practicing how to solve complex math problems doesn't just enhance our problem-solving skills, but also helps us realize that no matter how difficult the problem is, there’s always a solution. Sometimes when we invest, there may be times that we will feel lost. Sometimes the investing formulas, financial statements and financial ratios just don't make sense. If we apply the same patience that we did when we were learning complex problems in school, we can also apply it in learning investing formulas. Be patient and keep learning.
Why we should we participate in physical education and sports, when it's not important in the real world at all?
Do you remember the days when you were studying how to play a sport in elementary or high school or college that when you graduated, you already forgot how to play the sport? Or have you ever had times when you realized that learning sports doesn't improve our financial life at all. Shouldn't it be an optional subject and not mandatory? But if we look at it, physical education not only improves our physical heath, helps us learn new sports, but to teaches us to socialize and cooperate. In life and in business, intelligence does not always mean financial success. Sometimes relational and emotional success can also spill the difference between successful people and failures. In physical education and in sports, we learn the value of cooperation and team work. In business and investing, we also need to seek out friends and mentors who can help us and guide us to be successful investors.
As investors, we care for our future and the future of our family. We invest to generate passive income to reach our financial goals. We also invest to avoid financial risks such as being disable or getting sick so that we will not be a burden to our family.
Investing may be difficult at first. But the investor that never gives up on learning will eventually win. It allows us to assess whether our goals are really important to us or not. Investing allows us to identify our values in life. Are we persistent, patient and do we seek mentors? Should we quit or should we hold on to our goals? Should we lower our goal because of challenges or should we rise up and set higher goals?
There are a lot more values we can obtain when we invest. But the bottom line is that investing makes us a better person. It allows us to help our family, our economy and also to become a better you. So, the next time you invest, think not only of the financial benefits of investing but also its non-financial benefits.
If you wish to learn how to invest, feel free to contact me or contact FinancePH at 0905-FINANCE.
Did you know that less than 1% of Filipinos are investing and actively participating in STOCK MARKET?
Why there’s only few?
The main two reasons why is that we normally:
Most Filipinos are natural hard workers. They know how hard it is to earn money. That is why most Filipinos have a stronger emotion when it comes to losing money than when it comes to earning money. They would rather put their money on something that is safe such as the bank than put it on something that would earn more such as the stock market, but has no certainty.
Most Filipinos tend to look at the immediate outcome that it wouldn’t work without even thinking about the process on how the money is used to earn more money. Again, this is the result of the two reasons stated above.
What is the STOCK MARKET?
It is simply where the stock/shares are bought and sold. Stocks change in value everyday depending on how the investors view the company representing stock. If the investors perceive that the company has good strategies for the future and that they believe that the company will earn in the future, the stock price will most likely rise because there will be more buyers than sellers. The opposite is also true.
MOST PEOPLE SAY:
Did you know that you can start being a stock investor by just knowing the basics of investing in the stock market?
Did you know that investing in the stock market is not as hard as you think but will be very rewarding if you invest in it?
So, what are the benefits of investing in the stock market?
Here are some benefits that you can obtain when investing in stock market:
So how do I start investing then?
The very first thing to do is to learn the basics on how the stock market works. There are so many articles, blogs, seminars, and webinars on how to invest in stocks. You may also check FinancePH’s seminar on how to invest in the Philippines Stock Market by visiting www.financeph.com/seminars.
“WE MUST PUT AN EFFORT TO LEARN FOR US TO UNDERSTAND THE BASIC OF INVESTING IN STOCKS”
Second, if you already know the basics, you have to determine if you are a long-term investor or a short-term trader. For beginners, I suggest you go long-term. This is also true if you are busy on your job and just want to have your money work with minimal effort.
Is there any way to invest without so much effort?
You want to invest but you are too busy to learn these things by yourself.
I recommend talking to a financial advisor since they can give you options on how to invest in managed funds. As the term implies, you will not be directly selecting and managing the stocks but you will leave it in the hands of professional fund managers who will be the one to make your money grow in the stock market.
Talking to financial advisors may also allow you to learn the basics of investing in the stock market and would allow you to ask questions. After all, it would be much easier and safer to go in the stock market if you have a financial advisor guiding your way.
“NOW THAT YOU ARE INFORMED ABOUT STOCK MARKET, ARE YOU READY TO JOIN THE 1% AND BE CALLED AS A STOCK INVESTOR OR A TRADER?”
Adult life is like sailing on the ocean. A vast array and breadth of wonderful opportunities vis a vis the adventure story you’ll create makes it full with excitement especially for the possible things that we can do. Yet, we do know that this same feeling may also turn into sorrow easily as storms keep on passing by.
That is why we probably opt not to sail on the ocean of life too far by taking things slowly like still living with or near our parents, until we feel confident about our savings. Or perhaps we are the aggressive type: living wild and free, sailing wherever the wind takes us. Nonetheless, whatever we do, having a Variable Life Insurance should be one of the things we must have to attain a better future, and here are the five reasons why:
As they say, Y.O.L.O! So what are you waiting for? Try to contact a financial advisor now and let them help you start sailing in the ocean of life confidently!
FinancePH is an advocacy group founded in 2014 by a group of financial advisors.
“We are the best, largest, most influential and most preferred financial advisors of the Filipino people.“
Contact us if you have questions regarding tax, business law, stocks, investment, insurance, estate planning or money related.
Visit our FB page to view our upcoming seminars that you can attend.
Or book a free financial coaching with one of our financial advisors here.
View the Financial Advisory team of FinancePH here.
Read Our Previous Blogs: