Monday, December 27, 2010

Financial IQ: On investing stocks...

The values and performance of collective funds...Image via Wikipedia
Financial IQ Philippines Quick Hit(s):

Citeseconline provides free seminars on stocks.  Both equities and Mutual funds are good, as long as you are risk tolerant.


How to better invest in stocks? Are investment funds ok?


As a busy person who has no time to monitor the stock markets on a daily basis, is it better for an investor to just entrust our funds to an investment fund? Is this risky or less risky? After reading the answers of Insular Life to your readers’ questions, I researched their website and am curious about what I read in “Investment Funds of Insular Life Wealth Series.” Can you share more details, but more in laymen’s language instead of using stock market or finance jargon? Can ordinary people invest there and what minimum amounts are required?


Richard Toledo III, 38 years old, businessman, Cebu


Answer


Investing in the stock market is not as complicated as popular perception; you may want to look at buying shares as if you are going into business. For example, if I bought/invested in the shares of a successful neighborhood grocery, my investment returns would be a direct result of how the business performs from hereon. If it continues to do very well, then the value of my investment would grow just the same. The opposite happens if the business falls on hard times.


After you have decided to invest a portion of your funds in the stock market, your next decision point would be to decide whether you want to do this personally or just entrust the selection/management to an institution by way of investing in any of the investment funds being offered.




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