Youngster shares experience in investment
The truth is it is never too young to invest. I had started out at the age of 19, starting small. There are many other types of investment instruments like stocks, unit trusts and mutual funds. Thus, it is pretty much one’s choice on what they want to do with their money.
MIRI: Since young, I’ve always heard the adults talking about investment, that it is a way to use money to make more money, and it is something that is only associated with those with extra money.
Such was the typical impression of mine towards investment which I shared with many young people who thought that, perhaps, they would only understand the benefits of investing when they came to a certain age.
Young investor, Bong Jeen Hao, wanted to beat the odds, and the first thing he wished to do was to convince young people who were reluctant to invest.
“The truth is it is never too young to invest. I had started out at the age of 19, starting small. There are many other types of investment instruments like stocks, unit trusts and mutual funds. Thus, it is pretty much one’s choice on what they want to do with their money,” Bong told The Borneo Post in an interview.
Inflation and slower economy means higher cost of living and working at fixed wage no longer can sustain one’s commitment, he said.
“The commitment I am talking about here could be house mortgage, car loan, paying bills, children’s education etc.
“Typically, people tend to have a perception that investing needs a lot of money. It is actually both right and wrong. For young people who had just started their first paying job, they probably have lower salary; hence I would suggest them to invest in a more affordable investment like unit trust. Putting aside RM100 to RM200 a month for it may take longer time to gain dividend (profit) but it is also lower in risk.”
Stock investment, he added, needs more capital but is said to give higher return, which means it is higher in risk.
Growing up in a single-parent family, where the finances were often only enough to pay the bills, Bong said, had driven him to think alternatively and it eventually sparked interest in him to explore more in the finance industry.
“To be honest, I have desire to make money because of the financial pressure my family had that was too overwhelming. Thus, I vowed to make better living for my family. During my teenage years, I tried my hands on online business, making extra money that could temporarily cover any expenses without the need to ask for money from my parent.”
After Bong enrolled in Curtin University to further his tertiary education, a chance came knocking on his door, when a consultant from Peninsular Malaysia conducted a forum relating to investment and unit trust at the campus.
Bong showed his interest during the forum, after which he was offered a job in Kuala Lumpur for four months, as business developer.
“It was once in a lifetime experience, so after much consideration, I put my studies on hold for me to clock in real working experience.”
Asked how it went, Bong briefly said that it was challenging and it taught him a lot, including critical thinking and he became more mature and focused on his future path.
After temporarily postponing his bachelor degree, Bong came back a year and half later to complete it.
“I gained a lot of experience which was impossible to learn through textbooks. The property and stock investment, these are the real experience I had on the ground. It was a precious experience that would guide me far in life,” he said.
Investing, Bong admitted, is not like shopping in the wet market.
“You can tell which vegetable or fish is the freshest, but in unit trust or stock investment, you have to do your own research. I cannot possibly point out which stock is the most promising (or profitable), but I can tell you which unit performs badly in the market.” The Three ‘Ms’
Based on his own experience, Bong breaks down investing into three basic stages – Mindset, Money Management and Method.
Having the right mindset is of utmost importance, he said.
“As I started early, I had stumbled along the way too. There was one time I lost all my invested money due to wrong decision. Luckily, I invested small, hence, the heartache was lesser and I started again after that.”
Bong reminded those wanting to invest their money to reconsider their attitude in investing.
“I believe many have heard about ‘get rich quick’ or pyramid schemes that promise 20 per cent return within a fortnight. However, whatever that scheme maybe, always bear in mind that investment is not fast food. There is no legit investment that could promise high return within such a short time because if it is true, everyone is already laughing their way to the bank without breaking a sweat and hard work,” Bong emphasised. Money Management
‘Never put all eggs in one basket’ is the advice that Bong would often tell new investors.
“Even if he or she has huge capital to invest, dumping all of them into a single unit or stock is very risky, no matter how promising it maybe. The market could be going up or down and the prices could change very fast within a day. Therefore, it is best to have more options and invest in different units/ stocks.”
Greed should never be part of investors’ attitude when investing because greed would cause one to lose patience, he reminded. Method
Bong explained that analysing the foundation and portfolio of the unit or stock one intends to invest in is vital.
“Studythecompany’sprofile,how they had performed ( previously and presently) and their future projects. These are the elements that decide the company’s value in the market.
“These are part of the analysis before any decision and I would strongly discourage investors to choose blindly because it could mean gambling your money on something you do not understand.”
Making wrong decision and willingness to learn from it is also part of the learning process, Bong said.
Technical analysis, he explained, is the second part of the method that focuses on stock chart that shows how a company performs.
Bong suggested that sometimes a company seemed to perform well but it could possibly be a dummy company, which could be the work of some people to manipulate the market.
Thus, focusing on technical analysis alone is very risky, he added.
“It is best to focus on both foundation and technical analysis because you get to understand the company that you plan to invest in and how they perform.”
Apart from his permanent job as head of marketing and manager at an investment company, Bong had set up classes to share his knowledge and advice to new investors.
Bong Jeen Hao, young investor