Investing in the Stock Market: When Should We Start Investing Money

Investing in the Stock Market — Jay G. Peñaflor, a Philippine Stock Exchange Sr. Market Education Specialist and who is also a Certified Securities Specialist (CSS), our speaker in the BusinessCoach’s How to Invest in the Stock Market seminar last April 16, 2011, told us that when it comes to investing in the stock market, time is our most precious asset. The longer our time horizon is, the more time we have to make our money grow.

Mr. Peñaflor revealed to us 10 participants that compounding is, in fact, the single most important reason for me to start investing right now in the stock market. It is the multiplier effect that occurs when earnings or dividends in my investments begin to generate their own earnings.

Every day we invested is a day that our money is working for us. Investing helps us ensure a financially secure and stable future.

Mr. Peñaflor says that those who start investing sooner rather than later have a tremendous advantage. If we keep our money in the good quality stocks over the long-term, and then reinvest the dividends earned as we receive them, our investment grows exponentiallly over time.

Additional post to read: How Much of Your Savings Should You Invest in the Stock Market? >>>

 

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Investing in Stocks: How Can You Make Money

Before attending the BusinessCoach’s How to Invest in the Stock Market seminar last April 16, 2011, I asked myself how can I make money in the stock market. And this question was answered by our speaker, Jay G. Peñaflor, a Philippine Stock Exchange Sr. Market Education Specialist and who is also a Certified Securities Specialist (CSS).

Mr. Peñaflor revealed to us 10 participants, how we can make our money grow in the stock market. He said that there are two ways to make our money grow in the stock market. With his detailed explanation, I understand that I can make money through capital appreciation or when there is an increase in the market price of my stocks and through dividends by the company I invested in. Read below Mr. Peñaflor’s explanation…

Two Ways to Make Your Money Grow in the Stock Market:

1. Through an increase in stock price or capital appreciation
Capital appreciation is an increase in the market price of your stock. It is the difference between the amount you paid when buying shares and the current market price of the stock. However, if the company doesn’t perform as expected, the stock’s price may go down below your purchase price.

2. Through dividends declared by the company
Dividends are paid out to shareholders, representing earnings of the company that is not going to be reinvested in their business. There are two types of dividends that can be given by companies: cash and stock dividends.

Cash dividends is the earning of every share of stock declared by the company. So, if the company declares a dividend of 25 centavos per share, a stockholder with 10,000 shares will receive a cash dividend of P2,500.00, gross of tax (Php 0.25 x 10,000) in cash.

Stock dividends are additional shares given to shareholders at no cost. If the company declares a 25 percent stock dividend, a stockholder with 10,000 shares will be entitled to an additional 2,500 shares of stock. These shares can also be sold anytime after the shares have been issued.

Mr. Peñaflor also revealed to us that Philippine Long Distance Company stocks has the highest market price of all Philippine Stock Exchange (PSE) listed companies. With big earnings, PLDT is one of the most profitable companies in the Philippines and no doubt it is also the best dividend paying stocks company in the Philippine Stock Market.

Additional post to read: When Should We Start Investing Money in the Stock Market >>>

 

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One Best Way to Invest Money With Good Return on Investment

Investing in Stocks — I attended BusinessCoach’s How to Invest in the Stock Market seminar last April 16, 2011. The speaker, Jay G. Peñaflor, a Philippine Stock Exchange Sr. Market Education Specialist and who is also a Certified Securities Specialist (CSS), revealed to us attendees one of the best ways to invest money. And that is investing in the stock market.

The San Beda College faculty member said that history has proven that investing in stocks over the long-term provides greater returns and protection against inflation than other fixed-income instruments, such as savings accounts, time deposits, government securities, and bonds.

I learned from his lecture that stocks are shares of ownership in a corporation. When I buy stocks of a publicly listed companies like Jollibee Foods or Philippine Long Distance Company (PLDT), I become a stockholder or shareholder of these profitable companies. As an owner, I can participate in the Philippine’s leading food and telecommunication company’s growth and future profits. Though, I may also lose money if these companies suffer losses or perform below market expectations.

Where I can buy stocks? Well, it’s in the Philippine Stock Market. It’s the place where investors can buy and sell stocks of publicly listed companies in the Philippine Stock Exchange (PSE)

Mr. Peñaflor adviced us all 10 participants of that day to invest in the stock market because it’s one of the best ways to invest money. For it’s possible to get 50% return of investments even in 1 day. But as a stock market beginner, I need to be careful and become an intelligent investor. Like in business, it’s better to start small. Maybe P5,000.00 a month and learn the nitty-gritty side of compound investment.

As a new stock investor,  I should study first what’s the best stocks to buy that I can sell when I hit my target return on investments or hold on for a long-term investment to gain long-term dividends.

Additional post to read: How You Can Make Money in the Stock Market >>>

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