Getting your feet wet in investing

*This is not a sponsored post and we are not making any investment recommendations. Please do your own due diligence before making any investments. Please read the full disclaimer on the right column of this page*

As I am writing this article, I am very thankful of all the experiences I have gotten from the market all these years. I must confess, it hasn’t been all fine and dandy, but I have learnt more from losses than profits. Today, I am 23 years old – financially much more mature than what I was 5 years ago. In these recent 2 years, I often get this remark during social gatherings, “I wished I had started earlier like you”. Well, I subscribe to the Chinese Proverb; “The best time to plant a tree was 20 years ago. The second best time is now”. We can either wait for the best moment to take action and possibly wait forever, or we can seize the moment.

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How did I get my feet wet in investing? Education exposed me to the world of investing. During my poly days in Business faculty, I took several accounting modules that gave me a good understanding of financial analysis on companies. I got really intrigued by how the financial markets work, and decided to read up more on my own beyond the school curriculum. Not only did I read books, I also spent my free time attending free seminars organized by SGX Academy, which was time better spent compared to playing games or cafe hopping. After acquiring adequate knowledge, it was about my second year of poly that I bought my first Real Estate Investment Trust (REIT) which I still hold today (capital gains of 38% and annual dividend yield ~7.6%).

Buying my first stock led me towards studying more listed companies. I was particularly interested in property stocks, so I was browsing the marketplace for companies that fit that description. Very soon, I found a company called KeppelLand, a property developer listed on the Singapore Exchange. After working out the financial ratios, I hypothesized that the market might have underpriced the stock and there was more upside for the stock going forward. I bought KeppelLand at $3.30 with the intention to sell it at $4.20 about 2 years later. After 1 year of holding it, the company was privatised and I sold it off for $4.40, cashing in on my investment earlier than I’d expected. I like to believe that my valuation was fairly close to what the privatisation was willing to offer, otherwise we would conclude that I was just plain lucky (I really can’t say for sure which was it).

Over time, I grew interest in trading and started exploring more. I traded mostly Forex & Indices. At the start, I was treating it like a gambling den. After taking some losses, I decided to treat it seriously like a business. Today, I am a better trader than when I first started out, but I am still striving to refine my strategy and consistency.

Diversification is an important part of building a holistic portfolio with multiple income streams. Earlier this year, I decided to invest in crowdfunding (aka P2P lending), a debt instrument that can potentially yield about 8-12% annually. Crowdfunding allows individuals to lend out money to SMEs to fund their working capital needs. After getting my own feet wet, the rest of the Capitalistlad team decided to get invested as well. The barrier of entry for such investments is relatively low because you can invest with as little as $100. Read our earlier post about crowdfunding.

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Today, with all the hype about cryptocurrencies, we are looking to diversify into crypto assets. While some analysts say that Bitcoin could be a bubble, we believe that blockchain technology is here to stay and there are ways to capitalize on this. Cryptos extend beyond just Bitcoins but many other Altcoins as well.

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The best way to learn about investing is to get your feet wet, just like how the lads did. If you would like to find out how we are capitalizing on the crypto wave, you can reach us via Facebook message. If you would like to find out what crowdfunding platform we use, you could do the same too. Remember, this is not a sponsored post and we are not making any investment recommendations. Please do your own due diligence before making any investments.

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Till next week, have a good weekend!

Cheers,

Nigel Fernandez

Pictures from www.pexels.com
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