How can I begin my investment journey with limited funds? - Seedly

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AMA First Investment

Asked by Anonymous

Asked on 30 Jan 2019

How can I begin my investment journey with limited funds?

I am keen to start investing. Where do you recommend i go to learn on investing.

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Isaac Chan
Isaac Chan
Top Contributor

Top Contributor (Jun)

Level 8. Wizard
Answered on 12 Feb 2019

Hi there! The answers given by the others are good and comprehensive

But I would perhaps like to stress a point that the others might not have stressed yet, and that is, the learning of the fundamentals of any investment product. Yes, it is important to understand how REITs, bonds, and FX trading operates, but ultimately, it would be very helpful to understand what underlying factors affect the investment product you are looking at. Is it central bank interest rates? Is it a company’s earnings? Is it the trade war between US and China?

Understanding how the investment products are affected by their fundamentals finally helps you to understand what kind of investment decisions to make, such as buying and selling, and how long to hold the products. Investment products, though are represented by numbers, are finally affected by real world events and happenings, and trying to understand what factors influence them is crucial. This also helps you to guard against panic buying and selling, and cautions you on being influenced by the herd mentality (“im going to buy this share because everyone seems to be buying it”)

Such a learning task may seem daunting at first, but there are plenty of resources online, such as the website Investopedia, which offers some interesting insights into different asset classes. Perhaps focus on learning one asset class at a time, instead of rushing and feeling overwhelmed. Going head first and just buying and selling without much thinking is more akin to gambling than investing!

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Boonhow Eng
Boonhow Eng
Level 3. Wonderkid
Updated on 07 Jun 2019

reduce debt before investing. during this time, go to the library to borrow some books to read. if interest in to stocks/etf/real estate etc, find related books. get some basic knowledge first to prevent being scammed. too many people want to take your money out there.

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Teo See Hwa
Teo See Hwa

07 Feb 2019

Simple rule, take the cherry first think of other investment later.
Teo See Hwa
Teo See Hwa
Level 3. Wonderkid
Updated on 07 Jun 2019

Start with your Home, then think about Investing.

If got limited fund, go for the two cherries as fast as possible.

If fund is not a problem, salary allow, go private property instead of HDB.

Land cost increase 100% in 7 years from 2010 to 2017 if you can have a return that much you should consider otherwise get in the Boat.

Still don't understand pm me.

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Teo See Hwa
Teo See Hwa

07 Feb 2019

All SC are given two cherries, two time to buy BTO.
Teo See Hwa
Teo See Hwa

07 Feb 2019

I got my First cherry in 1988, second in 1995.
Leong Wen Fong
Leong Wen Fong, Community Lead at Seedly
Level 6. Master
Updated on 07 Jun 2019

Hello! Not an expert here, but from my time in the community, I do often hear a few things:

  1. Have you saved up enough to start investing?

WHy I'm covering something so basic, is because many who want to start investing don't think of this step before jumping in. Not only does this help to ensure you have food on the table for the next few months at least, it also helps you with your investing mindset- imagine if you don't have money beyond your investment, the way you react to things will be much more emotionally driven.

Many here recommend at least 6 months of your monthly expenses

  1. Are you investing for the short term or long term?

Depending on what you are going for, it will determine what instruments you use (bonds, REITs, etc) and what method to do the investment (DCA, one-time)

But the idea is to diversify and spread your risk throughout your portfolio.

If you want to find out more, you can read the many articles on Seedly blog!

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Teo See Hwa
Teo See Hwa

07 Feb 2019

Take advantage of what you are given, then go for thing that you are not given.

First of all Good Luck for your investment journey.

Starting an investment journey is can be overwhelming but you have to think smartly.

I can tell you about my experience what I did when I started my journey.

First clear your fundamental by learning blogs, article, and books on investment.

There are many investment ideas, for example, you can invest in Stocks, ETFs, REITs, FOREX, COMEX, Mutual Fund.

If you know already about its good.

If you don't, let me know I will you complete guide about them.

2nd Find your risk tolerance capability.

Do not just dive into the sea of stock trading.

3rd Open a stockbroking account or an investment account to make the trade.

4th You can start trading or invest with the small amount. In stocks, you can choose penny stocks to invest.

If you have no knowledge you can use advisory firms for help.

I use Multi Management Future Solution. They provide me with regular updates on Singapore stock exchange with the updated stock signal.

There are more on the internet. You can try them by using the free trial.

5th Know your financial objectives.

Make a plan and stick to it. Do not deviate from your financial target.

I hope I could help.

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Jonathan Chia Guangrong
Jonathan Chia Guangrong, Fund Manager at JCG Fund
Level 6. Master
Updated on 07 Jun 2019

I'd say understanding yourself and how you handle money is a good first step on the investment journey. Can you take a paper loss in your account, or are you the type who can see red without batting an eyelid. This will allow you to determine your risk profile type and the type of investment instruments that are suitable for you. For self help, you can read up on books like the intelligent investor, millionaire teacher or money: master the game. Or if you are inclined, pay to learn from a mentor via an investment workshop. This may potentially allow access to an established investment system which you can then use. In general, if you want to start small on your own , you can use platforms like posb's invest saver programme or maybank ke's monthly investment plan to start investing with $100 per month into the STI Etf or a bond fund or into a list of individual stocks. Robo advisories like smartly or stashaway will also allow small investments. Hope this helps

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Shann Sg
Shann Sg

12 Feb 2019

Hi Jonathan, may I know whats the pros and cons of RSS plan and Robo advisors. I understand both are similiar, allow new investors to start small. But are there any significant differentiators? Ie the fees, the guidance..
Jonathan Chia Guangrong
Jonathan Chia Guangrong

12 Feb 2019

Hi Shann. For robo advisories, basically you are buying into their respective investment philosophies and how they set up their portfolios for each risk profile. From what I understand of their fee structure, they will charge a certain percentage (e.g. Stashaway charges 0.8% of your account size for the first S$25,000, and it gets cheaper the larger your account is). Pros is that the portfolio will fit your risk profile based on the questions asked, and it's really a hands off way of investing, not to mention the relatively low cost compared to something else like unit trusts. Cons wise, if you know how to construct your own ETF portfolio, then this may be more expensive, fees wise. If you can access the global markets, or US market on your own and are comfortable buying ETFs manually, then robo advisory services are most likely not suitable for you. For Regular Saving Plans like those from Maybank Kim Eng, it's a good way to start for those new to investing. Kim Eng has a wide range of counters you can buy into on a monthly basis automatically, which makes this easy to start off with. Both STI ETFs and blue chip counters, including strong REITs are available under them. Fees are low at 1% for each transaction under this scheme. Only cons I can think of now is that you will need your dealer to sell the share holdings for you, especially if they are odd lot sized (i.e. not in lots of 100 shares). This will incur higher commission than normal as it is executed by the dealer directly. Just found this out when I instructed my dealer to sell off my entire stake in Mapletree Commercial as I felt it was already fairly priced and I could get about a year's worth of dividends in the profits. Another con I can think of is that you need to stock pick individually, unless you are buying into the STI ETF. So this may put some newbies off unless they are comfortable buying into the STI or a good REIT on a monthly basis. Hope this helps