Looking for an investment with high returns and relatively low trading capital? Then now is the time for you to learn how to invest in stock market. While many people have become successful from buying and selling stocks in the Philippines, much more have had their savings emptied due to lack of knowledge.
To maximize profit and minimize losses, you must be equipped with knowledge on how to invest in stock market wisely. You have to understand what the stock market is first before you start buying or selling stocks. As you become part owner of a company, you participate in the company’s earnings and losses which mean that when there is a great chance of high returns, there is also a high risk of loss.
Study your profile to know how much you can and willing to invest
You can be an aggressive investor once you already have low or no risk of losing your funds for your basic needs, mortgages, or your emergency fund or you if you already know how to invest in stock market. Your decision depends on your financial status and the stage of career where you are in. It is ideal to start investing once you have a secure job and at least six to twelve months of living expenses in your savings account.
Decide how much to invest
Although with some brokers you can start investing with just Php 5,000, it is still better to have more funds so you can diversify your holdings and also to minimize risk. To be safe, do not put more than 25 percent of your savings as recommended by most experts. If you already know how to invest in stock market, you should always remember not to risk what you can’t afford to lose.
Open an account with a reputable stock broker
You can visit the Philippine Stock Exchange (PSE) to see the complete list of accredited stockholders and to get information about the stock market and particular stocks as the next step leads you to pick a stock. If you don’t have the luxury of time to scrutinize a specific stock, you can buy a mutual fund composed of a variety of stocks. It is advisable to check the websites of the companies you are interested in.
Place your order
The last step is to place an order either by phone, text message, or other communication media that would reach your broker and wait for the confirmation invoice indicating that your order has been successfully placed. While online brokers settle transactions on the same day the order is made, traditional brokers usually settle it after three days.
Get expert advice
While this article talks about the first steps you need to take on how to invest in stock market, you need professional guidance to be successful in the trading industry. It would be better to gain knowledge first how to invest in stock market the right way by learning with the experts before risking your hard-earned money. Trading Edge Consultancy conducts stock market classes, technical analysis courses and even forex trading trainings, among others. Learn more today!