Posted on 23 May 2020
I am considering investing the $5,000 into a stock. Some of the stocks I have been looking at are Facebook, Amazon, Mastercard, Sea Limited.
Next, for the monthly DCA, I am thinking of investing through a Robo-advisor. What are your preferred Robo-advisor? I am thinking of Autowealth, despite the $3,000 min investment. Will Robo-advisors be a superior choice over buying the S&P500 stand alone? If yes, why?
Pls feel free to share any idea or criticize. Thank you in advance :D
Hey bro. Good to see you starting your investing journey early. I would be glad to share some of my experience and tips.
Before you start investing, I hope you set aside a sum of emergency fund. Even though it seems irrelevant/insignificant for our age, it's important in the event of a further economic downturn. It will help in giving you the 'holding power' instead of getting forced to sell your shares at a loss. In this period of pandemic, its hard to predict whats next. Do not ever assume its the worst now.
Moving on to the main question, I am curious how would you be saving that extra $1000 per month after enlisting? Since NS allowance is only around $500-$1000, its almost impossible to save up $1000/mth consistently. It is important as it might affect the way you DCA into the market.
Next on stock picking, if you are new, I wont suggest you to go into specific stock picking. I'll suggest you putting that 5k into robo advisors directly.
1 more comments
23 May 2020
'May I know the reason behind the advise to stay away from stocks as a beginner?' - Mainly because of the lack of knowledge and research. I'm not sure what makes you select Facebook, Amazon, Mastercard, etc. But I hope you did fundamental analysis on the companies instead of looking it as a consumer. (Big company, etc) Take a look at SIA, big company and was reliable but dropped from $10 to $3.50. Of course they are different but my point is to do a properly analysis. . 'Many investors have speculated... recommending me not to pour all my funds first' - No. That wasnt my initial meaning. But with this statement, it meant that you are unsure as well. Investing is not speculation. Speculation is as good as gambling. If you did you research (as mentioned above), you should be confident that the company is stable enough to tide through the crisis regardless of US stimulus package. (Back to SIA, its a good case study) But yes, in times of crisis like this, its uncertain and its definitely good to DCA monthly. Sorry if I'm too harsh but it's for your good. I hope you dont 'pay' a hugh tuition fee for your first dip in investing.
24 May 2020
Thank You! I certainly agree. Shall take your advice and start DCA passively while increasing my knowledge
Better leave the concept of single stock investing and concentrate on some of the lower risk/better ...
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