OFW Investment Tips: Investing in the Philippines is a common practice by overseas Filipino workers. Recently we discovered what the best investments are for OFWs in the Philippines. But today, we are turning our focus on investment tips.
As always, it’s recommended to contact an independent financial advisor before making any financial decisions. Nevertheless, let’s look at some unique and straightforward tips for overseas Filipino workers investing in the Philippines.
Overseas Filipino Workers – OFW Investment Tips
1. When Investing In The Philippines, Think Long And Short Term
Some see different types of investment as better than others in the investment world, but one factor impacts the perception of a good investment: time. If you are looking for OFW investment tips, then this is a concept that you may consider when deciding on what investment is best for overseas Filipino workers.
For example, let’s take a look at the commodities market. Commodities are tradeable assets such as sugar, wheat, oil, gold, silver, platinum, aluminum, and so on. Some investors may perceive these investments as weak long-term, but during the short term, prices can fluctuate, and returns can be high.
For example, during the invasion of Ukraine by Russia, investors saw the commodities market fluctuate. Wheat went up 20% within the first few days of the invasion. Therefore as a short-term investment, this investment would have been profitable. In summary, when investing in the Philippines as an overseas Filipino worker, it’s best to think in terms of short and long timeframes.
2. Research Local & International Events As They Will Impact Your Investment
The second OFW investment tip comes in the form of research. As we discovered a moment ago, when we looked at our first investment tip for overseas Filipino workers, global events affect the markets.
The market comprises of investors from across the globe. Many things can influence the world and investors’ emotions. For example, information from the media can influence how we perceive investments. A small percentage of selloffs can result in a snowball effect, and you may find that your investment in the Philippines (or overseas) starts to decline.
Some investors are known to sell their investment/assets only to repurchase them at a later date. To do this successfully, investors must keep an eye on the market and global events that are known to affect their investment. This is why research is one of the essential OFW investment tips in the Philippines.
3. History Echos. Examine Investment Pattens
You may have heard the following quote “History rarely repeats itself, but its echoes never go away.” Over the years, many investors and independent experts have taken these words to mean several different things. Some interpret this quote to mean that historical patterns show up in investment.
Whether you agree or disagree with this statement, we can all agree that we can learn a lot from historical data and events. As investors, we know that performance does not indicate future outcomes. Nevertheless, the lessons from the past are always wise to remember.
When looking at OFW investment tips, try to look at your investment in terms of patterns. Does a certain event or government announcement always lead to positive results? Does public awareness lead to a negative result? It’s impossible to predict the future, but clues can aid OFW investors in making the most profitable decisions.
4. As An OFW, Decide How Hands-On You Wish To Be
Each type of investment in the Philippines or outside of the Philippines requires a level of commitment. Some investments have virtually no maintenance, which we often call passive incomes. These tend to be investments that require little maintenance from the investor. However, on the other end of the scale, some investments require a more hands-on approach.
As an overseas Filipino worker looking for investment tips, you may be wondering what investment is best for OFWs? One of the factors that will help you decide this answer is how hands-on you wish to be.
You may find investing in your own business an excellent option, but you may find a more appropriate option in the Philippine Stock Exchange. The first option gives you more control but requires more time. The second option is passive and, apart from research, does not require much maintenance.
5. Create An Investment Target And Strategy
One investment tip for overseas Filipino workers is creating a simple but visual strategy and target. Over the years, I’ve met several overseas Filipino workers unaware of their investment target. Not having an investment goal and strategy can lead to additional risks. But there is more to creating an investment target and strategies.
One of the biggest benefits of creating an investment target is that you can then calculate how long your investment will take to reach your goal (based on average returns). Through this, you can see if this investment is right for your investment goal or if you need to adjust your investment strategy.
You may be wondering what an investment strategy is? In most instances, an investment strategy is a path you will follow to reach your investment goal. This includes where you will invest, what you will do with the profits, and your overall plan to grow your investments over the upcoming months and years.
6. As An OFW, Think Carefully About Following The Crowd
Another common phrase you may have come across previously is – “The crowd is almost always wrong.” For context, this can apply to a market such as cryptocurrency. Many investors believed it was a scam in the early days and did not even think cryptocurrency would reach $1000. Fast forward to the future, and we now know that cryptocurrency offers the best historical returns.
There are many reasons why the crowd will tell you to invest in one type of project compared to another. There were also many reasons why the crowd will tell you not to invest in a type of investment…
… as we mentioned cryptocurrency earlier, we will stick with this example. In many countries, including the USA, influential figures (bank CEO’s for example) told the public and customers not to invest in Bitcoin. Yet, at the same time, they purchased Bitcoin by the millions behind closed doors. To summarise, always do your own research. It’s best to take an independent perception regarding financial matters.
7. Investigate More Controllable Investments In The Philippines
Our final OFW investment tip comes in the form of an investigation. This is the investor’s choice between a more controllable investment or a more passive form of investment. If you have the time and resources available, investing in a private business or your own business may be a more profitable investment in the long term.
Naturally, with this decision, there are many factors to consider. The benefit of investing in your own business (or one that you can control) is responsibility. This responsibility can mean a potential loss of funds but can also mean high profitability. Another option if you do not have the time is becoming a local Filipino business partner.
If you decide to become a partner of a local Filipino business, you can support the business. Still, there are also options to become a silent partner depending on the agreement. Similar to other investments in the Philippines for overseas Filipino workers, this option has its advantages and disadvantages.
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