National Service (NS)
Asked 4w ago
My goal is to grow my money through a long term investment method that will generate profits throughout NS and university. What types of investments should i focus on and are there any places for me to gather more knowledge before i start investing? I have read a bit on value investing but it still feels like gambling to me when i invest. Also is it wise to rely on roboadvisors?
Assuming your investment timeframe is about 5 years, and that you may not have a steady income in University, it would be better to invest in something that doesn't require you to commit monthly or annually. So this rules out endowment plans or ILPs that typically require you to commit a certain amount periodically.
The next best option would probably be regular savings plan or robo-advisors that do not require a minimum starting capital. I have added links to the list of RSPs and roboadvisors. If you're concerned about the stability of roboadvisors, you can consider reading up about the roboadvisors that interests you, and check if they are already profitable or if they have recently secured funding.
As to what type of investments you should focus on, it depends on your risk appetite. I would however, advise against investing in individual stocks. As what you have said, it does feel like gambling especially if you do not know how to analyze the company fundamentals or read balance sheets. Instead, focus on ETFs and/or unit trusts.
As for resources, you can consider the books and resources I recommended here: https://seedly.sg/opinions/learning-to-invest. Consider exploring concepts breadth-first before delving into specific concepts.
All the best!
If you do not have any debt to pay off in the near term, and have already kept aside a decent amount of emergency money, you can start off putting some money into the Robo-investor of your choice. Below are some choices you could read up on and pick. I personally went for AutoWealth and it has been doing great for me.
Regarding places to gain more knowledge, you could read up the many articles here on Seedly for a start. Something from here would be a good start. https://blog.seedly.sg/category/basics-of-investing
Also, I wouldn't call long-term investment a gamble at all. I have been picking my own stocks for awhile now and have been doing alright. I mainly focus on growth investing instead of value investing at the moment. Nevertheless, the robo-investors are a good place to start. Once you learn more, you can venture into other investing options.
Adding on to what Andy Chan has mentioned:
The easiest way to invest for the long term is roboadvisor because it is very diversified, low capital, little time commitment. It is a good starting point and a good foundation to build on your portfolio. Investment is about managing your risk-reward appetite. If you are adventurous and wants to have generated more capital/profit, you could invest in stocks or bonds. For e.g portfolio of 70% ETF,10% cash, 20% stock pick. Thus, I would say that it will be great to have some roboadvisor /ETFs to ensure safer capital growth
(Value) Investing = Gambling?
Gambling is usually associated with the words 'risky'. Risk comes from not knowing anything or venturing without any plans. For example, An investor is willing to pay you for climbing Mount Everest.
Choice A: Awarded 1 billion if you go the next day
Choice B: awarded 0.5 billion if you went 2 years later
Choice C: Awarded 10 Million if you went 3 years later with professional coach training you and assisting you
You may not choose choice A because you are high likely to die
You would choose Choice C over choice B because you have time to prepare yourself.
Same goes for investing. The more knowledge/ data you have about investment or company, the confident you will be.
Value investing is the process of choosing underpriced stocks appeared at the marketplace. There are ways to calculate the stock value in the subsequent year. The calculation is based on historical financial statements
Example: Stock A's intrinsic value is $1 while the stock A's market price is $0.50..
You will then have to wait till the market realise the stock's true value before you sell.
You can read The Intelligent Investor by Benjamin Graham, the father of value investing
Now, the idea of value investing has evolved. Learning how to choose a great company. This means selecting great fundamentals, great economic moat, great management, etc
Anyway, all the best
If you want to enjoy risk-free interest, consider topping up your CPF.
If your definition of long-term is way more than 10 years:
If you want a diversified portfolio without thinking too much about it, robo-advisors is one of the ways. Just be sure to check the fees and the financial health of the company.
You can also use an online brokerage like Saxo and DIY.
If you need to touch the money in the next 5 years:
Either a conservative portfolio or cash management and insurance savings.