Investing in the Philippine Stock Exchange is a fantastic idea, especially if you are looking for long-term growth over a sustainable period. However, just like every investment in the Philippines, the Stock Exchange carries an element of risk.
In today’s article, we’re going to be addressing the fundamental question of should I invest in stocks in the Philippines by going over several areas to consider before and during investing.
Should I Invest In Stocks Philippines?
The Philippine Stock Exchange has a proven track record of historical growth over many years and multiple industries. Therefore some investors see the Philippine Stock Exchange as a relatively safe investment compared to other investment types such as Bitcoin. Thus, many invest in the Philippines Stock Exchange.
Whether you should or shouldn’t invest in the Philippine Stock Exchange depends on your overall financial goal. If you are a professional day trader or are looking for long-term growth, then the Philippine Stock Exchange might be the perfect option for you.
Additionally, there are a few areas to focus on when asking whether I should invest in stocks Philippines?
The Minimum Capital Needed
Stocks in the Philippines come with a restriction called the board lot. This restriction, however, is easily met. Still, a board lot is an important area when considering “should I invest in stocks Philippines “because your capital may need to be higher depending on the stock you choose.
Some stocks in the Philippines have a low price, and therefore the board lot is much higher. Other stocks are high in price, and therefore, the board lot is much smaller.
In previous articles, we have spoken about the board lot in detail; however, for reference, please take a look at the table below For more information.
|Price Range (Pesos)||Board Lot (Min # of shares)|
The Stock’s Future
One crucial area that you will need to know about is the industry itself. This is especially true if you are investing long-term.
For example, the gambling industry may not have a bright future than other industries such as technology. This is for example purposes only but highlights the future of two different industries. When this is focused on individual stocks, then the gap can be even more significant (profit and loss)
When looking at I should invest in stocks Philippines, it’s always wise to think very carefully about its future and the business itself. Is this kind of business going to be successful and profitable in the future? If the answer is no, then it is unlikely that the stock price will rise consistently.
The Overall Economy
The economy of the Philippines is a fascinating subject and one that’s been documented several times. Still, one consideration is that the economy is vital when investing in the Philippine Stock Exchange.
Before investing, it’s wise to take a step back and look at the economy through your eyes. Ask yourself – Where are people spending their money, what taxation applies, and finally, what direction is the economy going in?
An example of a stock that affected the economy – Airbnb.
Airbnb has been documented to have killed the hotel industry. This is not true as we know that there are still many hotels succeeding; however, the introduction of Airbnb affected the economy as this allowed people not only to earn money but allowed the public to spend money outside of the hotel industry. As a result, the Airbnb price increased, and many hotel stocks declined.
Market Trends Post Covid-19
The market trend post-COVID-19 is a very interesting and fascinating study. In the early days,’ the market took a hit; however, this was not as hard as expected.
But now we look into the future post covid what market trends will become popular and how will this impact the economy and the Philippine Stock Exchange?
Many businesses that can be taken online during this time suffered minor issues; however, many businesses struggled during the pandemic. when investing in the Philippine Stock Exchange and ultimately asking, “should I invest in stocks Philippines” it’s worth considering this area
As any investor knows, time is our most valuable asset, which is why choosing a stockbroker is essential. Many stockbrokers, such as COL Financial, are very beneficial when you are looking to save time.
The great thing about COL Financial is that they are an online stockbroker meaning that you can buy and sell stops from the comfort of your own home. We here at Filipino Wealth recently spoke about several stockbrokers and the options you have in our most recent article.
Stocks Vs. Other Assets
What you need to know about stocks is that it is not necessarily the best investment for everybody. I’m a big fan of stocks, but personally, cryptocurrencies have been more profitable for me and many others.
Therefore one consideration before investing in stocks is whether this is a suitable investment for you. Would your money be better suited in a foreign stock exchange such as the Singapore Stock Exchange or the US Stock Exchange?
Ultimately knowing the amount of money you have to invest and the level of risk you are willing to take will help you answer this question much more straightforwardly.
If you are prepared to take a considerable risk, then cryptocurrencies may be better for you; however, if you are looking to make long-term growth, stocks may be a better option. Here are a few examples of other investment options.
- Real Estate
- Alt Coins
- Cryptocurrency Mining
- Flipping Websites
- Reselling Social Media Pages
- Mutual Funds
For more information and passive income, ideas feel free to visit our recent post
Government Restrictions Or Openings
Government announcements, whether good or bad, affect the stock price. If the government is focused on increasing one industry, area, etc, then often announcements and openings will be made to make it easier (or harder) for businesses to succeed. As a result, stock prices will likely increase.
Real estate is one industry that has seen this progression in the Philippines.
The Philippines as a whole is a developing country. Many areas are developed, but some are underdeveloped. This area government officials were focusing on, making it much easier for rapid growth from companies such as Ayala land.
Interestingly, if you invested 2,000,000 pesos in the real estate industry on the Philippine Stock Exchange, you would have more profit compared to if you invested 2,000,000 pesos in a condominium (based on data from 2005 to 2021)
if you can’t invest in real estate, then invest in the companies that build real estate.A wise investor once told me,
Should I Invest In Stocks Philippines – Takeaway
Overall investing in the Philippine Stock Exchange is a fantastic idea for day traders and long-term investors; however, similar to every investment investing in stocks in the Philippines carries an element of risk.
The Philippine Stock Exchange is not a get-rich-quick scheme; even the legendary day traders accumulate their wealth steadily. But on occasions, the market can be on your side, and investment increases rapidly. You will then need to decide whether to sell or hold.
A common phrase used in the investment world is that you should only ever invest money that you are prepared to lose. I advise any investors to learn everything they can about your investment and the platform.
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