Making money through the Philippine stock market is not as easy as some people think. While entering the stock market is one of the more common ways for Filipinos to dabble into investing, jumping head-first without enough knowledge will cause you to lose that hard-earned money.
Investing in stocks is an intimidating concept for many, and rightfully so, since it’s not easy to earn money. Luckily, there are insurance products with premium allocation on stock investments like BPI AIA’s Medlife Protect Plus, which also dabbles in blue-chip stock investments for you. With the right approach and enough knowledge, you can find success in the market.
What are stocks?
Stocks refer to the shares in a company offered to the stockholders. This denotes shareholder ownership of an organization. The more stocks you purchase, the more percentage of the company you own. If the firm increases (or decreases) in value, you gain (or lose) money.
In stocks, you can grow your money through stock price appreciation and dividends. Stock price appreciation is when the market price of your stock rises, while the dividends are handed out when corporations share their profits with their shareholders. This can be through more stocks or additional cash.
Know that you can only purchase from and sell stocks of publicly listed companies that have announced their initial public offering (IPO), which refers to the process of a private company offering the sale of its stocks to the public. You can find all these stocks being bought and sold in the Philippine Stock Exchange (PSE), Inc.
Quick note: stock trading and stock investment are two different things, albeit they both involve earning profit in the stock market. Stock trading refers to the practice of buying and selling stocks within minutes, days, or weeks for short-term gains. Meanwhile, stock market investment pertains to building long-term wealth, holding stocks for years, and through the market’s rise and fall.