Every OFW’s Guide to Investing in the Stock Market

Have you invested your money already? No, this does not include savings account. By investment, this means you place your hard-earned money in a certain financial product for a specific time, thereby allowing your money to earn more than what you initially placed.

READ: Best Investment Options for OFWs

There are tons of investment options available that you can try. In case you are willing to take that risk in exchange of higher returns, then you might want to consider putting your money in the stock market.

Below are things you should know about the stock market plus tips on how to get you started:

Facts about the Stock Market

1. A stock market is a place that allows you to buy and sell stocks from Philippine-listed companies, which represents your “ownership” in a particular company.

2. There is only one stock market that facilitates transactions and is called Philippine Stock Exchange (PSE).

3. There are two ways on how to earn from the stock market: price appreciation and through dividends. Price appreciation is the increase in value per share of stock, thereby translating such increase as profit. On the other hand, dividend is the distribution of earnings (stocks owned x amount of dividend) to every shareholder in the form of cash or additional stocks. Dividend is given at least once a year but some companies could give as much as twice or thrice a year.

4. You don’t need a big amount to start investing in the stock market. Believe it or not, you can have as little as P5,000, which is already a good amount to familiarize yourself with how the stock market works. Eventually, you can increase your investment to allow you to buy more stocks.

Tips in Investing in the Stock Market

• Educate yourself about how the stock market works. Know the companies worth investing (also known as blue chips), check the price per share of the companies you are eyeing for (preferably for the last three months)), and keep yourself informed with what’s happening in the Philippines since this will likely affect the prices of stocks.
• Establish how long do you plan to put your money in the stock market. Stock market can be addicting, especially if you see that you are already earning, so make sure to put a limit on it.
• Choose a licensed firm and/or stock broker, particularly accredited by the PSE. This is a must because it is through them wherein you will course your stock transactions.
• Register your account online. Unless years ago where every transaction is done over the phone, you now have the ability to decide and do things on your own (and instantly too!) because of the online tool. This is convenient since you are working overseas and you don’t need a “middleman” to do the buying and selling for you.
• Think long-term when investing in the stock market. Keep in mind that the price per share appreciates (or depreciates) in a matter of days to years. Hold on to that number of shares you have if you want bigger returns.
• Do NOT put all of your money in the stock market. The returns may be higher, but the stock market can be risky as well. The key here is to invest a certain amount that will not cripple you and at the same time, willing to lose.

Don’t worry, there are more posts related to investing in the stock market, so stay tuned.