Investments: Buy Low, Sell High

Before you start throwing in your money in to the financial market, you must first know why you are doing so.

Basic rule of thumb:
DO NOT INVEST JUST BECAUSE YOUR NEIGHBOR IS DOING SO.

Actually, this does not apply to only investment, it applies to generally everything else in life.

For me, investing means:
1. Taking risks
2. Accumulate my wealth
3. Secure my retirement

It took me a while to convince myself to start investing, because I am not a big risk taker. I prefer being safe and I have heard many scary stories about investing.

But as I grow older, I realized that, the more I hold back, the further I drift from my dreams.

So, what I did was research, research and more research.

I found out that, having an investment portfolio is just like running your own business.
     - It requires you to know your "risk threshold"
     - It moves with the market ups and downs
     - You must have a plan or strategy i.e when to buy or sell, when to exit


Once again, do not invest in whatever your neighbor is investing, just for the sake of investment. Just like planning what business to start, you must also choose what you want to invest in, after doing your risk calculation.

One mistake that people usually make is that they expect high returns when doing investments, without considering market risks. They don't have exit strategies and blindly put their money where ever people tell them to.

Remember this: You develop your own portfolio, and you know your own risk threshold. If you feel uncomfortable with putting large sums of money into the "recommended" stocks, then take a step back to do your analysis.

Like I mention, one must have an investment goal before deciding to start up an investment portfolio.

In Singapore, citizens are able to use their CPF (something like pension money) to start investments. Normally these are tied to the bank and they can choose where they would like to put their money i.e. in mutual bonds, precious metals, unit trusts or structured deposits. This way, there is no need for them to have cold, hard cash on their hands to open an investment account.

Not all investments are the same. For example, when trading gold, we are allowed to open a savings account with a standard minimum of gold in grams, whereas for silver, the savings account will require a standard minimum of silver in ounces. The net worth of the item being traded also differs.

Other types of investments, such as stocks, can be traded online, with the additional charges of broker commission and trading charge.


Whatever you choose to invest in, the final goal of all investors is to Maximize Wealth. But don't let greed over-run your desire to grow your wealth.