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Basic Investment Principles In The Stock Market - Part 1 Of 4 |
By:
Zigfred Diaz |
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Basic Investment Principles In The Stock Market - Part 1 Of 4
Zigfred Diaz
Several people have inquired from me whether they should invest in the Philippine stock market. They also wanted to know how to begin doing it. I am not sure know if they are really seriously asking the question. They might be just curious about the stock market considering that it has been always in the headlines lately. This is brought about by the fact that it is at its highest levels since the beggining of its creation.
The fainthearted has no business investing in the Philippine stock market or the stock market in general. A true investor always has expectations as to how much he will earn from a certain investment. Normally this is measured in terms of how much money will grow at a given time. (This is commonly known as interest per annum) Now that the Philippine Stock market is in its highest level for some time now, people think that they should get themselves involved. Sad to say most do not even have a grasp of the basic principles involved neither do they understand how the system works. This is not to imply that you have to be an economist before you should consider investing.
What I am saying is that you should understand the basic principles involved first before you could succeed in the stock market. While it is true that fortunes are made on the Stock market, loss of wealth has also been experienced by some. Some who just barge into the stock market without understanding the basic principles of investment end up leaving the stock market convinced that the stock market is no good at all as an alternative vehicle of investment.
Before discussing the details on how to invest in the Philippine stock market we must first have a good grasp on the basic principles of investment in order that we might possibly succeed and enjoy trading. There will be ten principles that will discussed. The first one will be discussed here. Other points will be discussed in the articles to come. Please visit my blog if you wish to see the article in its entirety.
1.) You must realize that the stock market is just another vehicle of investment - There are several investment vehicles where you could place your money. One is not more superior than the other. They have their advantages and disadvantages, but this will not be discussed in depth here.
The stock market belongs to a category called "Capital Markets." In the Capital Market there are several vehicles wherein you could place your money in order for it to grow. You could place it in bonds, pension funds, insurance, real estate, different types of savings and time deposit accounts and of course the stock market. Why is it important to know this? Well, you should know the different types of investment vehicles under the Capital markets in order for you to determine whether or not you should invest in the Stock Market as there are other vehicles of investment.
As I said each of them has their own advantages and disadvantages. What I personally did is not to place all of my eggs in one basket. I have invested in most of the Capital Markets including the stock market, insurance, pension, deposits, and bonds through mutual funds.
With his diverse educational background and job experiences, Zigfred Diaz blogs on several topics including Financial managment and http://www.zdiaz.com/ investing in the stock market
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Article Source: http://www.statssheet.com/articles/article65564.html |
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