STOCKS: A LONG TERM INVESTMENT

 

In 2011, I began to invest in the Philippine stock market with the guidance of Bro. Bo Sanchez as my mentor. I was a member of Truly Rich Club since 2010 but I really didn’t concentrate until late 2011. Since I was in abroad, it is advisable for me to open an online account to check my portfolio anytime. Bro. Bo recommended the COL Financial (previously named Citisec Online) so people can invest in the Philippine Stock Market even in abroad and with little amount of investment. I was inspired by the book that Bro. Bo wrote titled, “How my maid invests in the stock market and why you should too.”

 

Since that time, I started to invest small amounts each month using the strategic averaging method (or SAM, now called Peso Cost Averaging) of investment. Eventually I didn’t notice that the small amount invested is getting bigger. I got excited and I looked at it every day before I do something in the office. There was a time that I want to borrow money just to buy stocks because I could see them going up. But I managed to control myself. It is a warning to be in control of your emotions or else it will make you greedy that you invest beyond your means. Moreover, the stock market is a risky investment. It is so volatile that some days they are going up and sometimes they are going down.

 

Before I invested in stocks, I also remember one colleague who availed of a loan and invested most of it in stocks here in UAE because at that time, the market was strong. He told us that before the recession, he would see the stock market going up every day. He became greedy and wants to invest more to gain more. Imagine, you see your stocks going P10 up every day. Then he will invest every day to the point of even borrowing money. Then recession came, and he was also laid off. At that time he faced dilemma, he said that he was bankrupt. All his money was invested in the stock market and if he withdraws them, he will be loss. He also has to pay for his loans each month and he will have no income, unless he could find a new job.

 

That is when I remembered Bro. Bo when said that we should not borrow money to invest in the stock market. It should be money that is extra and we feel that we don’t need in the near future. That is why it very important to have an emergency fund or a savings accounts where you could get in times of need. So that you will not get it from stocks as it is a long-term investment.

 

This is one of the mistakes I’ve made in 2014. I do not have enough savings/ emergency fund. The end result, I sold some of my stocks and withdrew the money to put into a new investment that I didn’t studied that much. I didn’t anticipate the cost I will incur before, during and after turn-over of my condominium unit. The end result is I need to withdraw some of my stocks so I could pay for my expenses. I know I did a wrong move and I feel that I don’t have a choice. I was blessed as my stocks earned a lot so I could withdraw some of my earnings. I was just sad that instead of buying, I am selling stocks and the stocks sold might have earned their own interest.

 

The good thing that happened is that I don’t have to borrow money to anyone or any bank to finance my condominium expenses. It helped to balance my finances. I praised God that He gave me the resources to be able to finance my other investment.

 

As of this writing, the stock market is going strong and most of my remaining stocks are gaining. I would encourage you that after saving for your Emergency Fund ideally equivalent to six (6) months of your salary; invest your money in stock market, mutual funds etc. that will yield high return for long term investment.

 

Below are my recommended steps:

§  Open an account in COL Financial. You can download their Forms in their website (www.colfinancial.com) and they will contact you once your account is ready to fund. They also have a trial period wherein they will take you to the experience of stock investing.

§  Regularly put your extra money in your portfolio (monthly or every payday). For as little as P5, 000.00 a month (COL EIP), you can jumpstart your retirement fund. As an OFW, this amount is easy to produce and it wouldn’t hurt your budget. Instead, it will help you in preparing for your old age.

§  Buy strong companies and invest in one company for the money you put in one month. Check for the companies that are under the Index of Philippine Stock Exchange, they determined the overall health of the Stock market.

§  Monitor your portfolio every one or two weeks. Don’t do it every day, unless you need to buy/sell stocks. Put a little excitement as you see your stock portfolio going up after each week. Moreover, if there are changes in your account, COL Financial will send you an email.  

§  Look for mentors and research more about the company you are planning to buy stocks. Many people are now investing in the stock market, so you could find people where you can get a nugget of wisdom. There are a lot of things to know about so look for someone who is also investing in the stock market.

§  Avoid withdrawing the money unless it is necessary. You know what, I have gained more than 100% of what I invested since I started in 2011. If it wasn’t for my withdrawal, it would be more. So I encourage you not to withdraw unless you don’t have a choice or there are investments that you would like to engage to.

 

I hope that this article helped you in deciding where to put your hard earned money for long term investment. There are still a lot of investment scheme that is available at your disposal, you just have to research on it to suit your investment objective. By the way, as a friendly reminder, please do not put all your eggs in one basket; diversify your investment so that you can spread your risk.

 

Happy investing and let God guide you in your journey to financial abundance as He is the ultimate source of wisdom.

 

God bless us more J

  

“If any of you lacks wisdom, you should ask God, who gives generously to all without finding fault, and it will be given to you.” – James 1:5