What is a Stock Market? How to possibly earn in stocks? According to investopedia, The stock market is the market in which shares of publicly-listed companies are issued and traded either through exchanges or over-the-counter markets.
2 Ways to Earn:
- Capital Appreciation (Ang Pera mo tumaas ang halaga)
- Dividend (Incentive/Bonus)
1. Get familiar with the Industry (Aral muna bago invest)
Learning a new thing is quite overwhelming! Take it from my experience…I invested in stocks for quite a while, When I first started,Wala akong malapitan. Lahat ng kakilala ko no idea about it. I went to the bank,binentahan lang ako ng insurance!
Gusto ko talaga matuto. So I invested in books. Every sahod, I paid myself first with a book. One book at a time. Instead of going to parties, I just went to quiet place and read,read,and read.
2. Get out of Debt
Buy in cash,stay away from debt. When you buy it in cash it is yours. Statistics shows that you tend to spend more if you buy things in credit especially if you use your credit card. Do not fall into the 12 months zero interest scheme. Credit card is the most emotionless and painless way of spending money. But once the billing statement comes “Ouch!” the pain sets in.
3. Build your Emergency Fund.
According to investopedia, An emergency fund is an account used to set aside funds needed in the event of a personal financial dilemma, such as the loss of a job, an illness or a major expense.It is encouraged to build a fund worth of 3-6 months of your monthly expenses before jumping into investing.
- Do I have a stable emergency fund?
- When do I plan to retire?
- Can I invest my money for the period of 10 years?
- Am I willing to wait that long?
- Am I willing to lose money and take the risks?
- Do I prefer to invest quick return of investment?
5. Choose the best Stockbroker
- TIN number is required
- Bank account for cash out purposes
- Photocopy of one valid government issued ID (Photo and Signature must be cleared)
- Downloaded forms from their website
- Billing Statement no later than 3 months
- Credit card under your name
- Utility bills
- Valid government issued ID same address on filled out on the forms
- Copy of certificate of employment
- Billing statement of your immediate relative with the same address filled out on the form
6. Choose your Strategy (Long-term vs. Short-term)
Standard rule for the starters is to go long-term first and start buying blue-chip companies. In that way, you are invested on less-risky stocks while you are getting the hang of it. There are many strategies in the stock market either investing on trading but it needs to fit it on your goals. If your goal is for retirement on 20-30 years range, keep your strategy on the long-term basis but if your goal is just for a very short time then you can just go trading, if you can take all the risk that comes with it.