Personal Finance Books
Asked 2w ago
I'm a 22 year old undergraduate, and I'm hoping to start investing in the near future. There are a lot of resources online and I don't know how to start learning. How can I start learning to invest (maybe reading books, etc)? Also, is it wise to start a robo-advisor account as I learn about investing? Thanks a lot!
Hi, dear anon,
excellent idea to start. And yes, it is very overwhelming with so many questions:
Do the finance professionals give advice free of conflicts of interest?
What are the risks, can I loose everything?
Which broker to use and how make a broker selection?
Should I buy and sell or buy and hold?
Single stocks versus Mutual Funds versus passive index ETF investing?
What books to read?
Is it wise to invest into bonds, or gold?
and many more.
I have written a text which gives (my) answer to some of these questions. As nobody knows the truth, you will find on this Seedly Q&A board diverging answers, which is normal, but bemusing.
One strategy could be to experiment in the beginning with different strategies, acknowledging that it takes time (some years) to really judge whether your performances are good.
Within this text is a link to an excellent german language book (the best on investing I believe!), You could tranlate excerpts with Google Translate.
For a beginner good concrete advice
to investing could be to start with a global passive ETF like MSCI ACWI or MSCI World; or U.S. focused with an SP500 ETF like VUSD on an europe stock exchange.
Then my own dogma in 1 sentence would be:
Invest 5-10% of your money into physical gold and the 90-95% majority only into well diversified stock ETFs and part of it into REIT ETFs via ultra-longterm Buy & Hold with periodically scheduled buying intervals using the cheapest available reliable online broker and reducing ETF and brokerage fees & charges to the minimum.
I recommend you start reading books and start with an easy one! Here are some I have read in order from easiest to hardest.
Get Rich By Retirement (SG Context)
A Random Walk Down Wall Street
The Little Book that Still Beats the Market (Magic Formula - Basic form of value investing)
Meanwhile, you can also start a robo-advisor account. Relatively fuss-free for Stashaway. The one that I personally used. Although I have stopped it because I believe the fees are a bit too high and I do not have the control to choose what funds I want to invest in.
I personally use FSMOne ETF RSP. The VT fund is a 1 stop fund to globally diversify into all equity funds. VOO is also commonly recommended as well as STI ETF.
I personally buy VT because of its diversified equities. I am planning to buy QQQ in the future to further increase my weightage on US equities.
I personally do not like the STI ETF as much because its performance is rather lacklustre. Moreover, it is heavily weighted in Singapore's financial sector. Also, SGX does not do some stocks justice. Their valuations, as compared to NYSE or NASDAQ, are relatively poor.
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Dude, I can coach you if you promise to let me publish it on my YouTube channel here. (PM me in Instagram and I'll lend u a hand)
I need to make content anyways so might as well help you while I'm at it. I'm from SMU btw haha!
Hold off the robo-advisor investing first. You might get tempted. The last thing you want is to lose tens of thousands of money you spent every weekend working for the past two years, aka me.
I've been investing for about half a decade, read a TON of books on investing (initially I wanted to be a securities analyst that's why!) And had small wins of my own like https://www.youtube.com/watch?v=l2EuKbpJdr0&t=307s
It depends on whether you're a nerd like me or not haha!
Not a nerd Start with investing for dummies. I think it provides a GREAT idea of the TRAPS because losing 2k when you only have 2k, is much more painful than the joy of earning an extra 2k, trust me the risk isn't worth it.
Nerd that wants to win in investing
I'd recommend learning from the best investor, which is Warren Buffett, but he doesn't teach in depth, but refers to his mentor Benjamin Graham, that wrote a masters level textbook that is still relevant today!
Intelligent Investor, then Securities Analysis (Read the newer version, older version is written in an old english and is SUPER dry). I can lend you the books if you need, or just borrow from the lib haha.
If you don't want to read and want to passively invest, then invest in US S&P500 index fund monthly! Index investing has been proven to be one of THE best investing techniques, and usually, active investing calls for at least 5% premium to be worth the time (I recall Ben Graham said that somewhere!) and you gotta ask yourself, the extra 5% of your own money worth it or not? If not, go work and earn more money and save like buffet when he was young, and like me right now.
P.S If this is helpful, please show some love cause my livelihood depends on it ;) https://www.youtube.com/channel/UCRJTXOvcpLIo4rh7jBrlOMA?sub_confirmation=1
Hi Anon, there's tons of resources out there that you can consider, depending on what medium suits you best.
The things that I use to improve my knowledge are books, webinars, YouTube videos, blog posts and podcasts.
I really like podcasts as you can listen to them on the go when you're on public transport etc.
For a full list of resources, you can check out my site.
Robos are great to learn about investing as they have a really barrier to entry, you can start investing with StashAway and Syfe with any initial sum.
So you can have a look at their investing strategies, see what they invest in and try to understand how the different ETFs work!
If books are not your cup of tea, watching a video explaining the summary of a book may help. It saves time and it is also easier to understand with the visuals.
I like this channel called The Swedish Investor. He does an excellent job.
You can also start by reading more financial blogs. Here are some of my favourites:
• Dr Wealth
• Investment Moats
• Financial Horse
• New Academy of Finance
• The Invest Quest
Also, joining financial groups on Facebook (e.g. Seedly, Financial Horse's Singapore Stock, REITs and Bond Investments) will help in enhancing your knowledge as we learn from one another.
And...If you are willing to pay to accelerate your learning, you can attend courses where fellow investors teach what they know and are good at.
So far, I attended:
• The Fifth Person - Dividend Machines (Only 1 enrollment per year)
• Dr Wealth - Early Retirement Masterclass
• The Asia Report - Singapore Banks
• The Smart Investor - All Stars Portfolio
You can definitely invest with a robo-advisor as you learn. In fact, as you research, you might pick up some useful knowledge along the way.
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What you are currently studying in university and your level of commitment (time) for investing would the options.
If you are currently pursuing a degree in business or finance, then in-depth knowledge of investments is (generally) required. You could start learning about one investment instrument first (e.g. bond), how it works, how investors profit, and what are the calculations involved. Once you are confident, you can move on to the next, stocks, and repeat the process until you reach derivatives or alternative investments. Investopedia is a good place to start learning about the mechanics of them. It is good to be able to read financial statements and balance sheets and to derive insights and projections from there.
If you are not studying in a finance-related field, in-depth knowledge is (generally) not required unless you want to invest in Specified Investment Products which are complex retail investment products. There are many books recommended to read before investing which can include The Intelligent Investor, A Random Walk Down Wall Street and Rich Dad Poor Dad. For the local context, I feel Simply Invest by Goh Yang Chye is quite good. At the minimum, you need to know what the investment product is, how you can profit from it and the risks involved. Before you start investing, you should also learn about insurance and be sufficiently covered in case of unexpected circumstances.
If you want to dedicate a significant amount of time to invest, you could spend more time learning about the various investment products. Once you have a build a solid or a comfortable level of foundation, you can start building up your own investment portfolio based on your investment objective, risk appetite and investment horizon.
If, however, you do not want to spend that much time into investing as time spent on studying/working could generate more returns, you could look into passive investments. You can choose to invest in index funds with a passive investing approach that tracks the performance of a basket of securities (stocks/bonds/precious metal/commodities/funds). There are many options available such as roboadvisors like StashAway, AutoWealth and Endowus, and Regular Savings Plan like DBS Invest Saver, OCBC BCIP and FSMOne RSP. There are many articles available about them individually and their respective differences. Do research more about them before you start.
All the best!
Here's an unpopular opinon, I would avoid reading books at the start. First, it's extremely boring. Second, it's teaches only the basics. For example trying to read The Intelligent Investor was actually torturous to me. But it would be easier if I had a prior knowledge in investing.
Instead, I started learning about investing from live people:
i) YouTube: Start from YouTubers like Graham Stephan, Andrei Jikh, any Singaporean investing channel like Fifth Person or even my channel (www.youtube.com/ahvin2020)
ii) Go through InvestingNote.com. Learn from the community about their thoughts on real Singapore stocks.
RoboAdvisor is a good place to start. You won't learn about investing there though, but at least you still get to grow your money. Then once you invest for real, you can get a potentially much higher return than a roboadvisor.
For starters, these two books by a local trainer.
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