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This article is a guide to start investing in stock market. I shall discuss the process to how anyone can start investing or trading in Philippine stock market. I have written this article to discuss and provide clearer view to how we can start investing or trading in the Philippine stock Market and to silence the noise and bells and whistles of investments hype.
I shall be direct to the process so we can start right away to the things we need to do. Let us dive and begin. First i will discuss the basics
Step 1 : Basic and Introduction Overview
First of all investing and trading are two different things. Anyone can start trading using any brokers account. And anyone can start investing using a brokers account. The reason why we need to use a brokers account because it is one of the process to start trading and investing.
Furthermore, using a brokers account we can buy public companies that are traded in an index market And this is what we called stocks. Public companies share and ownership are traded publicly through an index market. Index market are called stock market. Here in the Philippines the index market or stock market index is called PSEI.
The PSEI is where the trading or buying and selling of stocks happens and etc and so on. The reason why the companies go public and wants their share and ownership to be traded for the reason of more growth and this is what you call valuation.
Technically speaking as an investor you are buying the value of the company. The value will grow and your invested capital will also grow as the company grow as well. Now to be able to understand the value and growth or valuation we also need to understand the annual performance of a company
With that being said, we need to track the companies performance annually, by breaking the performance per quarter. This is when you will notice Q1 reports, Q2 reports, Q3 reports. These are basically financial statements provided by the public company and their growth
The q1, q2 and q3 and q4 means first quarter, second quarter, third quarter and fourth quarter Because there are four quarters per 365 days in a year and three months per quarter.
Step 2 : Understanding the difference
OK, i have heard so many people referring and talking about trading and investing but don’t have a clue what they are talking about.
Trading is different from investing. Trading is a repetitive process of buying and selling and share or stock in a specified time and repeating it again.
The reason why trading correlates with investing to some people because most of the trading process requires a capital investment.
Investment on the other hand is the process of buying and holding the ownership as long as possible without worrying about the liquidity of the market and bull market season and bear market season or inflation or stock market bubble.
But, when investing our hard earned money, of course we also need to worry with all the possible market fluctuation for we are using “time” to increase the value of the amount that we have invested.
Step 3 : The Capital Requirement
The capital that is needed to start investing in Philippine stock market can be around
- 5,000 Philippine Pesos
- 10,000 Philippine Pesos.
The capital that is needed to buy the needed shares is or the amount is your
Every investment or business must have a capital. The capital that is needed to fund the venture or fund the project or prototype.
For individuals like you and me, the capital that we need is the amount that we need to make our dreams a reality.
And it is up to you how much money you are willing to invest in stock market. And you must also remember that the risk of losing your hard earned money will be very high if you don’t know what you are doing.
Step 4 : The Process and How to…
1 Open an BROKER account in the Philippines
There are numerous brokerage service is the Philippines that allows you to start buying and selling stock from different companies in the Philippines
I will be listing my top STOCK BROKERS companies in the Philippines
The starting capital will be around 5000 Thousand pesos to 10000 thousand pesos of buying power. I would highly recommend to open an account to any of the stock brokers account that i have listed. Once you visit the website you can navigate the sign up page just like any other websites out there that requires an internet user to create an account.
Once your account is created you will be required to submit a valid government information to confirm an individual if he or she is a legal residence in the Philippines and confirm the identity using any other governments credentials.
Steps 5 : When to start trading?
Step 6 : How will i trade using the brokers account?
Now this part of the trading process will depend which stock broker you will be using. I would highly recommend to train and familiarize yourself first with the stock brokers platform and back end tools for 1 week and two weeks.
Each brokers i have mention has different trading environment and can be a bit overwhelming at the beginning. Get the feeling of adrenaline by joining the live market by watching the index movers of the market then you will see the numbers, the volume and movement of the companies that are being traded.
Train yourself with the brokers environment back end tools to be familiar when the moment comes you decide to join the live market.
Step 7 : How will i INVEST using the brokers account?
This process does not require you to trade. COL Financial and UTrade offers investment growth program if trading is not your thing.
After you have created an account under U trade or COL Financial you can apply for their investment program. The program can sometimes be referred to as
Peso Cost Averaging Investment.
In simple explanation this is how it works
The “Money” you invest will grow in “Time”
Because the “Share” will have outgrown its value through “Time”
The program of investment is different than trading because it will requires amount that needs to be deposited to the shares that you are holding. To increase the value of your investment you must then increase the quantity of you shares Either monthly, quarterly or semi-monthly.
UTrade Investment Program
COL Financial Investment Program
Step 8 : What are the Philippine shares of stock i can trade or buy?
Sometimes the market gainers today can become the market losers tomorrow.
This is all depends to the demand of the ownership
Below is sample of chart for companies performance
These are short discussions to how you can start investing in stock market. I would love to answer your questions and help give you information to expand you knowledge in investment
Here Some Example of Stocks you can buy in the Philippines Stock Market
If you have any questions let me know. Leave you comments below and ask me questions with your comments. You can also contact me
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