Let’s take stock marketing trading in Philippine Stock Exchange (PSE) as an example. Philippine Stock Market Trading is probablay one of the OFW Investment tips an OFW should closely work on and prioritize for its tremendous benefits.
Stock market in Philippines is now considered a good investment in Philippines for OFWs because workers will be ensured that all their hard work abroad will pay off and will grow more without doing a lot of physical work.
“As a former OFW, I’m trying to find ways of how can my hard-earned money earn more. I have bank deposits (savings, and time deposits), though I got to know that these are not investments.
- Ever ask yourself if you’ve been spending your money properly? Or what are you saving for? If it’s mostly because of the materialistic things you’d like to have, think again. For there are various ways that you can use this money that will beneficial for you and your long term plans in life.
- Thinking about buying a ? new gadget?
On this article, simple steps and tips will be shared in learning the basics of stock investing that will start as a Beginner’s OFW Starting Complete Guide in the Philippine Stock Market while you’re working abroad.
1. Determining your Profile and Goals
Deciding whether you should delve in stocks isn’t as easy as blinking your eye or waking up the next morning with the sense of urgency to open account and start trading. You have to think this thoroughly and perform an assessment if you are financially and mentally ready for it.
2. List down the things you want to achieve.
- In order to have a definite mindset of the things you want to achieve, write it down to remind yourself that these are the things that will keep you motivated on going down the long process of achieving these things. May it be plans for retirement or business and maybe buying your own house and saving up for your future family, these should be written down in order for you to be aware of time and be wary of the opportunities or chances you might have been missing out because you always this thought that things can be finish tomorrow or after a week.
3. Have a financial goal
- Before getting into stocks, ask yourself, ‘What’s your financial goal?’ This is to understand why you’d invest and save money. The financial goals should be as accurate as possible for you to enable to narrow down the time you’ll need to have and the strategies you’ll have to come up with in order to achieve these things. This even starts with how you save with your monthly income, if you’ll start in stocks, how much are you willing to spend on stocks itself? How much for the daily expenses and other important matters?
- There are lots of techniques out there and how you can perfectly save up money – take the 50-20-30 rule as an example. It says that 50 should be spend on daily expenses, 20 on leisure activities, and 30 will go to your savings (e.g. retirement plans and alike).
4. Resilience on future risks
- As they say, stocks have its own small ups and downs or tremendous ups and downs which can greatly affects us in terms of our future plans with it, so upon entering into stocks, you should have prepared yourself of the possible risks by studying and learning more from those who’ve been on this field for a long time.
5. Knowing the industry you’re going to take
- As much as possible, read a lot of informational materials that will give you a hindsight of the industry that you’re going to take. Take it from the experts when it comes on giving efficient tips on what kinds of stocks are good to go and predictions on how the stock will work on a month or so.
6. Set your expectation on stock market
- Since stock market requires you to be efficient both in art and science because it requires a thorough understanding and analyzing of financial data about market performance. An instinct on what data should signify and shouldn’t be should be one of the asset skills that you should have.
7. Understanding Stocks Marketing
Stocks is known to be shares of ownership in a corporation. It’s in the stock market where buying of stocks is happening and in the Philippines, it’s PSE or Philippine Stock Exchange that handles and governs the local stock market. After successfully buying a stock from a company, this means that you’ve now become an owner or shareholder of the particular corporation and be part of the company’s growth and success, and even the losses.
8. Investing Wisely on Stocks
Investing your money on stocks sounds to be a risky and bold thing to do for the money you have saved up? But why do you think many people have taken this bold step?
- Early Investments Opportunity – Always look at the bigger picture of your life, no one would like to work until they can’t. Investing earlier will give you the chance to save up for your retirement and future plans you’ll want to have.
- Regularly Investing Opportunity – Investing regularly will also help you in having a higher chance of earning more by the time you’re ready to settle down.
9. Knowing your options
There are two types of investments that you may choose from as someone starting in this field.
- Equity index funds or exchange-traded funds – These are the funds that allow you to buy small pieces of many different stocks in one transaction. This means that when you invest in a fund, you also own small pieces of that companies.
- Individual Stocks – Targeting a specific company, it allows you to buy a a single share or a few shares with a company or corporation.
Starting on your investments
10. Open an account with a trustworthy stock broker
- To ensure that you’ll have a legitimate list of accredited stock holders, you may visit the Philippine Stock Exchange (PSE) website at www.pse.com.ph. You can open an online stock trading account starting with as low as 10k and invest in Philippine Stock Market. Instead of doing the traditional way of calling the broker to place stock orders, you can do it on your own by opening your account online.
- Choose your preferred online broker, fill out all the forms needed and together with other documents that they’ll be requiring you, visit their office and submit these to have your account opened. Did you know that you can actually start with little money as a beginner? You can invest at least ₱5,000.00 to ₱10,000.00 as a start in trading stocks in Philippines.
- After successfully opening your online trading account, you’ll have to fund your account by making an initial deposit. Remember that there’s no required amount of monthly funding for your trading account, it’s all your choice as to how much you’d like to fund it, but the fund on your account also will determine how much you can purchase on the stocks.
- There are many stock brokerages in Philippines that you can choose from. Here’s a list of some of the more popular firms that many retail investors use.
- Top 20 PSE Online Stock Broker in The Philippines
11. Choose a stock to pick
- There are various stocks to invest in, but always opt for stocks that suit your investment needs. It’s ideal to choose stocks that pay little or no dividends, but in return gives more than expected growth rates. Most starting individuals in this field opt for individual companies or invest in a mutual funds wherein the money came from several investors and placed in stocks or bonds. But since fees can be higher, you should be careful on this type of stock for you may end getting low rate of return and slow down your financial progress. Every time that you will invest in a stock, always have thorough analysis if the costs and fees of this would be beneficial and will not entirely reduce your gains.
12. Place your order and monitor your stocks
You may place your order online or have a broker or stock broker firm to do it for you. You need not to check your account every day which means you may do it on weekly or monthly basis and see how your stocks performed.
13. Start trading
- After buying and earning a profitable amount and getting around the stock market, this is the time wherein aside from buying, you may now sell the stocks you have.
- How To: Buy and Invest Shares In Philippine Market
14. How long should I hold onto stocks I have?
It’s best to keep the stocks for long term, probably for five to ten years or so. If the market has a bad or good day in a month or year, don’t tempt yourself into selling your stocks because keeping it longer will bring profitable changes for your account. Nevertheless, it’s advisable if you’ll buy low cost stocks and sell them in a high pricing on systematic process monthly.
15. Keeping a Good Portfolio
16. Have an established benchmarks
- It’s vital that you are aware and you continuously keep a steady and finite benchmarks for you to measure if your stocks have been performing well in accordance to your plans and expectations. Setting a benchmark will help you in understand if the investments have been working well and if it’s worth pursuing.
17. Observe the performance of your stocks keenly
- If the stocks you’re investing on isn’t performing well and you’re definite that it would be a continuous downhill, it’s about time that you should sell it on spend your money on more profitable stocks. But always bear in mind that one to three years in stocks would be the first tough years of your journey since this is a long term investment.
18. Seek a broker, banker, or investment adviser’s help
- One of the things to keep on surviving in this field is to never stop learning and exploring stocks. Keeping either a broker, banker, or continuously seeking an investment adviser’s help will profoundly help you in choosing what stock to invest on, what should you pull off, and know how to get around the market well.
Seeing the fruitful outcome from trading in stocks may come in fast or slow, but nevertheless this requires a handful of knowledge, understanding of its pros and cons, and knowing that with great success from trading, comes great responsibility in purchasing and maintaining your stocks.
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