Updates! Hell week

Sorry guys, I haven't posted this week. It's the dreaded hell week in university and as much as I would like, I just haven't found the time yet. 

However, the next post will be about the UP Invst Finals! We won 3rd place! (Spoiler Alert) 

Cheers!

Book Review: Wealth Watch | The Investing POV

Do you have a friend who has just started investing recently? Or know someone who has just started with his first job? Or is your mom planning to fund a new bank account?

If you or  someone in your life who is keen and interested to know more about finances or is just starting to invest then the Bangko Sentral ng Pilipinas' Wealth Watch is the right book to soothe your financial appetite.

The Wealth Watch is a financial health and wellness book published by the BSP. It talks about savings, budgeting, investing, banking, credit and borrowing and other topics related to key financial health issues.

This is the first personal finance book I have ever bought and I must say I have still learned a lot while reading it. You do not need to be a finance professional to read and enjoy this book as it specifically targets the "everyday Filipino" with its broad yet timely topics. Anyone -- whether a student, teacher, housewife or someone in their mid 50's can all relate to the topics.

Reflection Guide after every chapter

Its contents range from anecdotes, real life experiences and notes about each key topics. Not only that but in every end of a chapter, they provide you with a set of questions that you may ask upon yourself. This is a good way to evaluate what you've learned from the readings. This is also in line with the sort of health vibe of the book as it makes a conscious effort to be your personal financial consultant.

The publishers were also careful as to use layman terms and to provide notes for financial products and other terms that might be unfamiliar to readers. This I think is a great help specially for starters like myself.

Overall, I enjoyed reading this book. I haven't finished reading it but I'm already looking forward to the next topics which are credit/borrowing, banking and consumer protection because I know that they would surely be useful when I start my professional career in a few months! 

Its content and look are indeed worth more than its 200 pesos selling price. Its hard bounded and is printed in glossy paper. It also serves as a good eye candy in your living room/study (such a bonus!) 

Glossy paper and really eye catching images

And if your interested on getting a copy you can get one from the sales counter at the ground floor of the Economic and Financial Learning Center at the BSP head office or if you happen to be in a conference sponsored by the BSP try looking for their booth, they might be selling one there which is where I bought mine. (last October in the DLSU-D JFINEX Students' Summit at ULS, DLSU-D)

For more information, check the BSP's Media Releases Page

That's all for this week guys! I hope your enjoyed reading the Wealth Watch as much as I did.

Cheers!

Disclaimer: This post is not sponsored. This is my own opinion about Wealth Watch. :)

Investing in Experiences: Stock Market Challenge

Hi guys!

Today, I want to talk about JCFAP's Stock Market Challenge, a national wide portfolio challenge. The mechanics are simple. Participants must make a team of 3 and trade using the Investagrams platform. Each team will be given PHP 100,000 (virtual money, of course) to trade with. The goal of the competition is to get the largest profit from your portfolio starting October to December 2016.

At first, I was excited and optimistic in playing. My teammates and I have been investing for quite sometime and so we pretty much know the basics. However, trading is different from investing and this challenge made me realize that I'm not a good trader (at all). The challenge for us students is that, university demands a lot of projects and outputs from us that, in all honesty, it is hard to find time to monitor the market movement. 

We were mostly busy with activities, exams, and reviews. Sometimes, we tend to forget to check our Investagrams portfolio. Although we have enjoyed some gains, there were more losses than what was expected. This is also due to the current market condition - The US Presidential elections and other local government uncertainties greatly affected the short term volatility (or the price movements) of the market even though the company's are actually doing well.

The competition is still not over and we will still be playing with the SMC, but I realized that investing is the strategy that would work best for me. I would rather stay in the market for the longer term as this suits my financial needs more.

How about you? Are you a trader or an investor?

Disclaimer: This are my personal thoughts about the competition. Credits to JCFAP for the image above! :)

The Investing Perspective: Should students join a "Paluwagan"?

What is "Paluwagan"?

      Paluwagan is a Filipino term for a saving or investment method commonly practiced in the Philippines. Paluwagan comes from the root word "luwag" which means loose or allowance.

How does it work?

      It starts with a group of people who will pool a fixed amount each week. This amount will be given to 1 member of the group and that will be his income from the paluwagan. On the next week, the group will be giving the same amount in the pool and this amount will be given to the next person on the list. How much you earn from the paluwagan depends in how many yo are in the group and how much you put in it each week. most of the time, the main person in-charge keeps track on who and when someone will be getting his share and will inform that person.

Is this a good investment option?

     Some analysts or advisers might tell you that paluwagan isn't a good investment option since it doesn't really have a clear sense of the time value of money and, that because the pool will be given to different persons each week, it would seem that the first money will be benefitting the most.

   

     But to me, I don't like to think of it as an investment because it's NOT! It won't be sufficient for you to finance your goals and if you only have a paluwagan as your investment then you've got to think of other ways to grow your money.

    I like to think of it as more of a saving method than an investing one. The money you put on the pool will be  keep for safekeeping and in a few weeks time it will be returned to you. If your give 100 pesos of 10 weeks in a paluwagan, you will be getting 1000 pesos on the 11th week. in that case, you don't really earn anything instead your only saved the 1000 pesos from getting used for you current whims and wants.

When should students join a paluwagan?

   Paluwagans aren;t necessarily a bad thing, but what students should understand is that before joining anything that involves your finances, make sure that you have gather all the important details such as how much you will be needing to contribute and when or how you will be getting the income. The most important tip that I can give you is only join a paluwagan if you have SPARE MONEY or SPARE ALLOWANCE. 

   Don't join one just because everybody else is doing it. Join for the experience, yes, but don't venture on something that you can't commit to. Remember that this involves a group of people and they are dependent on your contribution as you are with theirs.

Disclaimer: This post is based on my options only. The images is from google and from a site called onlinepaluwagan.blogspot.com so credits to them! :)

Investing in Experiences: UP INVST Updates | The Investing P.O.V.

Hi guys! Hope you're having a great week!

This past few weeks have been so hectic with schoolwork, extra-curriculars, and lastly competitions. And speaking of contest, my friends and I got into the top 10 teams for the UP INVST which is an annual research and valuation competition. We are so delighted to have come this far and are pushing our gears to get to top five. 

It's really a challenge because we were given 2 weeks to value BDO Unibank. It's a bit complicated than normal manufacturing or retailing companies but with a little bit conviction we will sure be able to make an awesome valuation.

That's all for this week. Sorry for such a short post. The deadline for our paper is on November 21, so now is definitely our crunchtime. I hope that you guys are doing well with academics as well. and take the opportunity to join competitions it will be a great experince.

For more info about this event: 

When in Manila http://www.wheninmanila.com/up-jfa-intercollegiate-valuation-and-strategies-competition-invst/

UP INVST FB Page: https://www.facebook.com/UPJFA.INVST/?hc_ref=PAGES_TIMELINE

Disclaimer: Credits to UPJFA for the poster. 

Investing in Experiences: How to be a Better Public Relations Officer? | The Investing P.O.V.

I had my fair share of PR or Public Relations duty when it came to events but I can't say all of them went smoothly from me. So many factors came to play but at the end of the day, it's the experience that matters.

I'm an accountancy student which meant that most of my knowledge if rooted to accounting and finance. If I talk to guest  with this topics, i'm good. But what happened was I was assign to PR for advertising and marketing professionals. It was quite an experience. A pretty mixed one at that too.

So what can you do to be a good PR?

1.) Do your Research
Before the event itself, make sure that you have done your fair share of homework about the industry and the speakers you will be meeting with especially if your not keen to their field. This will help you answer their questions and will let you engage on casual conversation with them while, let's say, waiting for their turn to talk to the audience.

2.) Be Observant
Being a PR also means that you'll be taking care of them while they're at the event. From the time they arrive until they depart for the vicinity. You have to be observant and attentive to their needs. Initiate an offer of food and beverages or may a bottle of water. The little things will be much appreciated.

3.) Be Bold
If you've done your research and if your observation skills are on point, then, the final step would be to just be bold. Speak up! engage with them. I mean, sure their respected people from the industries but their also humans. Just make sure that you stay respectful and polite. 

That's all for this week! I hope you guys can apply this on your next PR assignment! :)

Disclaimer: Found the image on Google images; originally from http://plaidswan.com/proving-pr-works/

The Investing Perspective: The Not-So Perks of Overspending | The Investing P.O.V.

Hi guys! Welcome back to my blog! I hope that you are all spending a blessed All Saint's day here in the Philippines and are having an awesome Halloween on your country as well!

Today, I want to talk about Overspending. We'll tackle what it really means, why it happens and how to stop it.

What is Overspending?

Basically, overspending means living outside of your means. You are spending more than what you really have. If you were given Php 500 allowance for the week, you most likely have spent Php 600 causing you to either ask for more allowance or borrow money from a classmate or friend.

Why do we Overspend and How do we stop it?

1. Misconception of having lot of money
This happens especially to those students that are given monthly or weekly allowances. At the begin of the month or week, there's this feeling that you have so much money to spend with! (which is obviously not true) And so, he/she might be tempted to use it on unnecessary things. You need to pause and remember that this will be your allowance for a span of time and assess first how much you'll need everyday, making sure you've covered it first before spending that rest on what you want.

2. You don't have a clear Budget to begin with

For me, this is the number 1 reason why a person overspends. I get my allowance on a monthly basis and before the start of every month, I would manage that allowance by making a budget (see: How I budget my Allowance) to make sure I can cover all my anticipated expenses, use a portion of it to save and invest, and the rest goes to my daily expenses. I will always save first before spending.

3. You have a Budget but it's not correct
I'm guilty with this one on a few occasions, you might have not anticipated correctly or underestimate/overestimated you budget. It's important to update your budget regularly so that you can be sure it really works for you!

4.Need to keep up with the current trends

Maybe, there's a new phone coming out? or a new game console? Maybe it's because there's a new fashion trend and all your friends are starting to wear it. Keeping up with the trends, make a person, especially, young adults feel like they belong to their group or circle but it's not necessary to do so. Trends will most like come and go, and by the end of the month you'll find yourself buying the next big thing. Sure, if you can afford to do so, then that's good, however, if you know that this is beyond your budget then you better think twice! 

5. It's Human nature?
Mr. Edric Mendoza of ANC addresses this as, people always wanting for MORE. When a person has means they would start a cycle of greed and end up wanting more. However, we also have a capability to change that way of thinking and focus more on what we need rather what we want. 

For me, overspending isn't just a situation a person faces, it could also be a lifestyle for other people. It's important to break from it while we're still young, that way, we are surely one step closer to financial freedom!

Thanks for tuning in! What financial concept would you like to talk about next time? Comment them below and see you next Tuesday!

Note: Found that cute little piggy bank image from Google, credits to its owner! 

Student Leader Chronicles: Dialogue with Sen Bam Aquino

The Dean of OSS on his Opening Remarks

The Council of Student Organizaions,last October 25, 2016 (Tuesday), invited 100 selected Lasallian student leaders were invited to have a dialogue with Sen. Bam Aquino. It was a short affair but it was engaging and spontaneous. I honestly learned a lot more about the current educational reforms and policies implemented in the country. 

1.) The Education Budget

According to the Senator, who is also the chairman of the Senate Eduction Committee, the budget this year for education was a whopping PHP 566 billion, which is also the largest budget of the year. Most of the budget for education goes to building facilities such as schools and classrooms in rural lands. He noted that apart from classrooms, most rural areas ask for better internet connections as well, showing just how much technology is needed even in education.

2.) K to 12: What is it and How does it work?

In the recent years, the government implemented K to 12 in the hopes to be at par with other nations surrounding the Philippines. This programs, according to Senator Aquino was pattern of that of Singapore and Germanys's educational system. And here's how it works,

Senator Bam Aquino on different education
reforms of government

By Grade 11, students will be required to choose a "track" which are Academics, Technical-Vocation Livelihood, Sports, or Arts and Design. This four tracks are further subdivided into more specifics tracks for students to choose. So if a student is aiming to go to college he will most likely pick the Academics track. I also discovered that Gr 11 and 12 students will also under go a mandatory OJT depending on the chosen field (which I think is awesome)

Why was it implemented? What were the expectations?

The main reason K to 12 was implements was not only to keep up with other nations but, most importantly, to make sure that after Grade 12, a student is already EMPLOYABLE. This means that they already have the necessary skills needed by companies that will allow them to be employed right after graduating. Sen. Aquino also said that because of this, it was expected that most students will pursue the Tech-Voc tracks rather than go to college. Classrooms were being built and teachers were being trained to be able to cater to the new system. Youth entrepreneurship in all levels will also be implemented where they will be teaching about financial literacy and the value of money. This are two things I am most excited about!

Issue:

But here's the thing, the government grossly underestimated the numbers. A lot of the students chose the academics track. They were expecting a big dropout but 92% of students chose to enter grade 11. The underestimation was mainly due to the negativity of the people before the start of the implementation.

3.) Free tuition for State Colleges and Universities Bill

Although this was yet to be passed, this will surely make a positive change in the country. This will allow less fortunate filipinos a chance to go to college and pursue a degree. I'm personally looking forward to this.

Dialogue

After stressing his key points, students were then given a chance to ask him some questions regarding the reforms

A Psychology student asked him about current special education budgets to which the senator said was pretty low. 

Senator Bam Aquino on his Dialogue with student leaders

A political Science student also asked to confirm the budget cut for the National Commission of Culture and the Arts which might ultimately cut budgets for programs such as arts and dance, that which the senator also confirmed. 

A Filipino major student petitioned to give the Filipino language more importance in the K to 12 system 

and lastly, when another Education  student asked him to justify the k to 12 system, Sen. Bam said that ultimately he believes that this is the step to be able to address, unemployment and job mismatch issues and that, over the long run, this is enable Filipinos to get jobs quicker.

Experience:
In the end, I am proud to say that I was part of the organizing committee for this event and though it was quite rushed, the students were able to get better insights about what to government is doing as we speak. Sen. Bam was friendly and engaging and was trying to insert as much laughs as he could while in the dialogue. He also encouraged the students to maximize their use of social media and to stay connected with the government as much as possible. He hopes that we will be sending our suggestions of what we thinks will be a good reform or law and they might possibly bring those suggestions forward -- you'll never know until you try!



That's all for today, see you guys next Tuesday!

Investing in Experiences: 2nd DJSS

Last Saturday, I attended the 2nd DLSU-D JFINEX Students Summit: Money Matters, Changing The Way You Think About Money at the Ugnayang La Salle Gymnasium, DLSU-D. It was one of the biggest events I have gone to so far in this year and I must say they did a really splendid job. The DJSS is a fund raising event held annually in our school. I organized the first DJSS but this year's summit far outshined and outperformed the previous one. 

Four amazing and engaging speakers graced the stage and talk about how money affect our sense of leadership, investing, relationships with others and our spirituality. All of the speakers are in the top of their fields and were so engaging, you couldn't help but get drawn in their talk.

The organizers also didn't disappoint the participants with their generous sponsors and food partner. Food quality was ensured by McDonald's and thousands of pesos worth of raffle draws were given by their sponsors! The most memorable ones were the 5 lucky winners for the 25k accident insurance by Sunlife;the 3 10k discount from Tree Top Adventure and 10 lucky backpack winners  from Hawkbag. 

The weather was especially sunny on that day as well and there were a lot of participants. the whole gymnasium was jam-packed! It's really amazing how one organization is able to spearhead all of this is certainly a feat.

The summit all in all had a wholistic view about money and gave its attendees insights on how money affects a person as a whole. The morning talk focused more on money and how it affects your sense of leadership with Mr. Abante of the Department of Finance, he talk about how as young government officials are constantly facing a lot of challenges. Mr. Marvin Fausto talked about how you can use money to start investing and start to accumulate wealth at a young age by investing in the stock market. Mr. Pangilinan enumarated how important building good relationship with others affect your mindset in money emphasizing that a great relation ship with God and your family can help you better handle your finances. Lastly, Pastor Soriano, inspired us to be better investors while also stressing out that we need not be consumed by money in order to experience a full and satisfying life.

At the end of the day, everything went on smoothly up until the closing remarks to the distribution of certificates. The only thing I could comment on was the lack of ventilation and poor air-conditioning of the venue but other than that I  was super happy with everything else rating this event a 9/10! But seriously, I think it was the freebies  and merchandise that really caught my heart.

Disclaimer: This post is not sponsored. It is simply my review for the 2nd DJSS. Credits to DLSU-D JFINEX for the posters.

Investing in Experiences: Online Stock Trading Seminar

Last Monday, I attended the Online Stock Trading Seminar of the DLSU-D JFINEX. It's their annual stock trading seminar which aims to encourage students to create their on online stock accounts and start investing early. For 2 years, COL Financial has been their partner in spreading financial literacy and letting the community know that investing in stocks are not only for the rich and wealthy but for every Filipino! COL also set up a booth where student are inquire and fill up account forms.

Mr. Jed Velarde, a training consultant from COL Financial, was invited to talk this year. I really enjoyed listening to him and he gave us a lot of tips on how we should perceive the market and look at it from a long term perspective. He gave a lot of stories and analogies that were simple yet effective that both students and professors understood and related upon like comparing the amount of groceries you can buy then and now to explain inflation. He is such an engaging speaker and was able to even make students laugh at some of his jokes. 

I learned 3 important things from Mr. Velarde which are:

Be an Investor - Mr. Jed encouraged us to think of ourselves as investors in the stock market and not traders. Traders are usually does person who closely watch the market and day trade which is to buy and sell a stock on the same and gain profit through  share price appreciation. He told us that it would that, although there is nothing wrong with being a trader, it entails a lot of risks and as students who wish to maximize the growth potential of our portfolio we have yet to afford such risks. He recommend being an investor instead where you can continuously invest in the market.

Invest for the Long Term - We should also invest in the market with a long horizon in mind. The market is constantly changing however, in the end, its trend will always go up especially in a developing country like the Philippines which still has so much potential to grow moving forward. Which is why if you are going to invest now, keep in mind that you will doing so for the next 30 to 40 years into the future.

Do it Regularly - Invest in the market regularly. Mr. Velarde suggests monthly, quarterly or maybe semiannually and make sure to invest in stocks with good fundamental which will certainly continue to grow and be more profitable in the future. The trick to this strategy is to continue investing even if the market if high or low. COL Financial  believes that thru peso cost averaging you will be able to create a sizeable portfolio with low cost stocks especially in the long term and you may do this as well through their EIP.

So if you are a student and you are interested in creating your own stock account you may do so thru COL Financial starting with 5000PHP. Here's what you'll need to open one. I hope you'll find it helpful and see you in the next post! 

Disclaimer: This post is sponsored or anything of that sort. Also credits to the DLSU-D JFINEX for the posters and guidelines on the COL account requirements.

Student Leader Chronicles: Interview with 95.9 Green FM

Being a student leader has brought a lot of challenge but it has showered upon me countless of blessing and opportunities as well! One of those is to be invited as a guest in the Lingkod Lasalyano program of our universities radio station, 95.9 Green FM. 

Lingkod Lasalyano is a radio talk show program in our university which highlights key projects and activites made or are being held by the Lasallian youth. Last Friday, they featured the Council of Student Organizations' upcoming event which is Enviweek 2016: The Lasallian Youth in Action for Environmental Conservation this November 14-19, 2016. This will be a week long event focusing on the environmental advocacies and how the youth can start making a difference in our environment.

Chelsea, my co-projecthead (right) and I (left), were both awestruck and flattered that Green FM chose our activity as their  feature. We were a bit nervous because it was our first time to be interviewed live but Mangie, the Lingkod Lasalyano host and her team guided us all through out. 

Being invited in this kinds of appearances really bring joy to me as a student leader -- that I will be able to reach out to be fellow youth and encourage them to make a difference in their lives and to our community. We really hope that our event will be able to make an impact in the lives of students and the opportunity to talk about Enviweek on air gave us more drive to push even further!

That's all for now. I will be post more about our event in the coming weeks. Cheers!

The Investing Perspective: How I Budget My Allowance?

I apologize for the temporary haitus for this blog. University life has basically eaten up almost all of my free time. But I'm glad to be back! Today, I want to talk about something I've been doing for the past month in order to help me stay on budget. I have tried a lot of methods to keep track on what I spend but I just couldn't commit to any until this one.

As a typical college student, it really vital for me to monitor my allowance because of I don't, I wont be able to eat the next day. And since, I'm a student leader, I'm very active and I usually join events and competitions. These are a few of the reasons why I created a system for my to budget my allowance.Basically, I made this budgeting system using Google Sheets, which I really find convenient. I can easy edit my template on my laptop using my google account; or my phone using the Sheets App. 

The formula I use is very straightforward. It's my take on the concept of Income - Savings = Expenses. My savings are my deposits to my stock account since I still don't have a job and really want to take advantage of investing early in the stock market, I put a portion of my allowance to my investment.  But I also deduct one time expenses that I foresee to happen in that coming month. For example, I know that I will have to pay membership fees last September so I made sure to deduct it on my spendable allowance beforehand. I really love the fact that Conditional Formatting is available in Google Sheets as well and it really help to condition my mind to save even further.

I also included the one-time expenses I failed to budget on (red mark) so that I can have a better view of the things I did not take account for so that I can avoid it in the future.

After getting the Spendable allowance, I would divide it by 4 weeks and further divide it by 6 days which are my normal school days in a week to get my spendable allowance per day. However I also add the Total Variance to that which is equal to the maximum I can spend in a day. The variance may be a surplus of deficit depending on by much I saved out of the allowances on the previous days.




If you want to try using this template I have uploaded a sample here as well, feel free to download it. The Investing POV: Monthly Budget Allowance

How about you? How do you budget your allowance? Comment them down below.

Disclaimer: The formula is something I created for myself, it may vary from one person to another!

Student Leader Chronicles: The Grand University Recruitment Week

A few weeks ago, the Council of Student Organization and the University Student Council organized The Grand University Recruitment Week participated by the different Recognized Student Organization, Auxiliary groups, Performing Arts Group and Political parties DLSU-D. This event was held in our university's lake park.

 It was a fun-filled for the students and student leaders alike as they showcase their respective organizations. The event started of with a grand parade around the university proper. Although the participants were considerably fewer, we were happy that students from the Senior High Department and their professors watched as we passed their side of the campus. The rest of the day was spent on decorating the booths and recruiting new members.

This  year in particular, a lot of the organizations took advantage of social media by publicizing posters and updates about their booths in platforms like Facebook and Twitter. A lot of organization also gave away free food for new/old registered members. Here a few examples from DLSU-D Lifters, a religious student organization. They chose the give away bread as was often told in the Bible! I like how they related the nature of their organization to the concept of the recruitment strategy. The other post is from the Lasallian First Aiders - Red Cross Youth, an interest organization which in my understading is widely patronized by med students (atleast in our university, but anyone interest may join)

In the end the event wasn't perfect but no event every is! What's important is that the organization was able to expose themselves to the students and a lot of new members were recruited! this is a good way to find and train new student leaders who will one day become the officers of their respective organizaion!

Disclaimer: This post is not sponsored. Credits  to DLSU-D Heraldo Filipino, Lifters, LSFA-RCY and CSO for the photos!

Investing in Experiences: Why become part of a student organization during your university years?

This week the College of Business Administration and Accountancy Student Council launched their TatakPinoy: Tatak CBAA recruitment week, so in a typical the IPOV fashion, I'm going to list 3 reasons why you should join a student organization in your school!

1. Building connections

As part of the Executive Board of an organization, you get a chance to work with and collaborate with different organizations within and outside your university. You get to meet fellow student leaders especially during events and event meet well-known professionals in your field. In a way , you are already starting to make contacts and you will be most likely to be remebered by students and professors because you are active in the college.

2. Resume Builder

When you become an part of an organization you will be able to attend seminars and training workshops sponsored by the organization or its mother institution. Most of the time you will get discounts in this events as well. It is also a good way for you to be able to fill your resume with events you have attend and those will surely boost your credibility as applicants in the future.

3. Freebies!

I love the quote in the string bag, it's really inspiring and perfectly describes long term investing!

Honestly, this is my favorite part. There are organization which are very generous to their members and will give them freebies when possible. Take DLSU-D JFINEX for example, by signing up as one of their members, I got a string bag and loot bag with goodies for 135PHP. I already consider this a bargain considering that they  organization about an average of 18 to 20 events in a semester and most of them will be free of members. And, as an avid advocate of finance, attending in this events are crucial so that I can continuously gain financial knowledge. I also recieve a really cute email from DLSU-D JFINEX welcoming me this academic year!

DLSU-D CBAA Students, visit their booth now! (string bags  and fans await!)

Next week I will be posting about the Recruitment Week organized by the USC and CSO! Stay tuned!

Disclaimer: This post is not sponsored by the council or organization.

The Investing Perspective: What Are Stocks and How Do You Earn From It?

Although Filipinos recognize stocks as a form of investment in the Philippines, only few Filipinos are actually invest in the stock market. These might have sprung from misconceptions like "only rich people can afford to buy shares" or "I didn't finish a business course therefore I have no capability to invest in stocks" -- which I find really disheartening. Equity investments are good ways to generate profit and diversifying your portfolio and with proper knowledge, anyone (whether you are a student -- like me! -- or a working professional) can venture in it.

Stocks are simply define by a lot of authors and websites as an investors ownership over a particular corporation in which he invested in. For example, a company has issued 10,000,000 shares and you bought 1,000,000 which is 10% of the overall share. This make you owner of 10% of the companies equity. This is a from of capital structuring used by corporations in order to obtain much need capital so that they can continue to operate or expand their companies. There are 2 basic types of share: Ordinary share, which are common and gives its holder the right to vote during board meeting and Preferred shares which has a fixed dividend rate. Owners of preferred shares are prioritized when companies issue dividends. I want to focus this post to Ordinary share as they are more common and less complex.

Now that we've had a brief background of what stocks are, let's go over to how you actually earn from stocks. There are 2 common ways namely is through dividends and through market price appreciation.

Dividends

Dividends are portions of a companies earning which are distributed to shareholders. The gain from dividends depend on how many shares of stock you have in the company. Let's say that X Company's board of directors decided to distribute dividends amounting to 1 PHP/ share. This means that if you are invested in 1 million share, you get PHP 1 million less taxes.

Market Prices Appreciation

Your investment could also profit simultaneously through price appreciation. Let's say the you bought 100 shares of Y Company for 5 PHP. After several weeks the price per share went up to 8 PHP. the result gave you 300 PHP (8 - 5 = 3 x 100)  less of course taxes. The logic in this scenario is that you were able to buy the stocks cheaper than what they are currently priced in the market. This gives you an opportunity to sell them higher and realize gains from it. This method works well especially if you are a long term investor.

Now that you a have an idea on stocks, you're next step is to know When Should You Start Investing in it. Are you ready? Share you experience investing below!

Happy investing!


Disclaimer: The article is based on my personal opinions and experiences. the post is not sponsored or any of the sort.

Sources:
Dividends: http://www.investopedia.com/terms/d/dividend.asp
Stocks: http://economictimes.indiatimes.com/definition/stocks

The Investing Perspective: When Should You Start Investing in the Stocks?

To start, let's answer the following basic questions:

1. Are you knowledgeable of basic stock trading principles and terms?

2. Do you have investable money?

3. Are you aware and/or ready for the risk that comes with investing?

4. Ready to make it a long term trading a habit?

If you've answered YES to all four questions, then its evident that you should be starting NOW. If you've confidently answered YES, it means that you have the capacity to properly establish and monitor an stock and is more likely to gain profits than those that a not knowledge but a investing.

However, if you don't feel confident enough to answer 'yes', it is never to late for you to learn and

have a change of heart. Here's how:

Knowledge

If you are a student, I suggest you join or attend seminars conducted by the finance organization in your school -- if there are any. Most seminars are about the basics of investing. If you are a working professional, you will find that a lot of banks and financial institutions hold free investing seminars for you the attend to. Most of them also have investment products or funds where you might want to invest on. Stock brokerage firms will conduct seminars to teach you the basics of the market as well as how to use their trading platform. And lastly, if you are an OFW, there are webinars and live stream seminars conducted by banks or financial institutions that you will be able to watch online. 

If you want to test your trading skills without actually investing money in the market, you may want to try the Free Trials offered by online stock broker. You can also enroll in a stock trading school,if you have the time and resource to do so. In this case, try looking up Caylum Institute, a stock trading institute in the Philippines which caters courses and seminars to help you learn about the investing. I personally haven't enrolled in it. But I've seen it featured in some conferences I've attended and its key officers are well respected figures in the financial industry

Money

I want to emphasize the term 'investable'. This is very important especially if you are a student with no means of steady income yet just like me. Make sure that the money you will invest in stocks are surplus money (income or allowance less all deductible expenses). In short,  it should be your spare money. We don't want you borrowing money just to be able to invest or worst starve yourself just to save up for investing money.

Risks

As the saying goes, "the higher the risk, the higher the returns". This is very true in the stock market, which is one of the riskiest asset classes due to high volatility (degree in price changes) of the stock prices. This can make some stock prices rise 20% today and fall 15% tomorrow depending on market movements. 

with that bring said, if you plan to invest in stock, you have to be ready to won some and lose some. The key to lessening losses is  diversifying you investment portfolio. Invest in different market industries such as services, banks, property or gaming and also make sure to invest in strong and reputable corporations over fly-by-night ones.

Habit

If your starting early with investment horizon of 5 or more years, make sure to make investing a habit -- inculcate it in your lifestyle. I would recommend over investing a one time big time lump sum investment. This method will  better mitigate your cost in the long term. Remember to make it a habit to invest monthly, quarterly of yearly. It doesn't matter if the amount is small, what is important is that you create an attitude of habitual investing.

Time vs Timing

It's very important to distinguish this two concepts. I use the term "Time"to mean the actually start of your investment relative to how long you plan to keep yourself invested in the market. For example, the time I started investing was when I was 20 years old and I plan to stay investing in the stock market for the next 40 or 50 years.

I tend to use Timing to mean the market condition by the time you invested. Will you be starting when the market is high or low?  It is preferable to start buying when the market is low because stocks are cheaper but do not be discourage to invest even if the market is slightly higher because over the long term, there are still a lot of profit potentials especially for good stock picks.

Do you think you're ready to invest? Let us know! Leave your comments and questions below!



Happy investing!

Disclaimer: The article is based on my personal opinions and experiences. the post is not sponsored or any of the sort.