Moving on to the mainstream of mainstream investments: the stock market.
When you buy a stock, you’re basically buying a tiny piece of a company. And if the company does well and makes good profits (as you believe it will), its stock price should go up and/or the company will share some of its profits with you, by paying you dividends.
How do you choose the right company to invest in? When to buy and when to sell? Well, you could spend a lifetime and several fortunes studying these two topics.
There’s a huge amount of resources available (books, websites, videos, forums, groups, seminars, etc.) if you wanna learn more; even for a small market like ours. I’m no stock market expert, so I’ll leave it at this and share you some of my favorite resources to learn from below.
BTW — If the concept of picking individual stocks scares you, you can always fall back to ETFs or low-cost unit trusts.
Typical Returns :
Too diverse to tell. For example, everyone’s favorite blue chip stock, Maybank went up from RM 8.20 (30th Dec 2016) to RM 9.80 (29th Dec 2017). That’s ~19.5% gain in one year. In the stock market’s last big crash however, Maybank went down from RM 9.44 (28th Dec 2007) to RM 5.15 (26th Dec 2008). That’s a 45% loss in one year. Play with the charts yourself here.
How to Start:
Sign up for an online stockbroking account to gain access to stocks. I personally use Rakuten Trade and Hong Leong.
Best Places to Compare / Learn:
Quick guide to Malaysian stock investing
Stock market basics
Quick guide to Malaysian stock investing
Stock market basics
How to invest in foreign stocks
How to invest in foreign stocks
p.s. Remember the ETBS, REITs and ETFs we spoke about earlier? Signing up for a stockbroking account allows you to buy these too. And if it’s a global trading account, you can also buy foreign stocks.
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