Tag Archives: stock market 101

Stock Market 101: Diverification for Beginners

This video of Armand Bengco, an Executive Director in Colayco Foundation, was uploaded in February 16, 2012 in YouTube. The interview was just a portion of the program and may be old but it still holds valuable information that will guide us about the importance of diversification.

Here are some points that I quoted from Mr. Armand Bengco’s interview:

“Don’t put your eggs in one basket. When we drop that one basket, everything crumbles”

“Diversification is a way to reduce risk”

“Huwag lang sa iisang instrumento”

In investing, there are two kinds of transactions:

1. Buy – give higher returns, higher risk. Examples are:
– Real Estate
– Getting into business
– Forex Trading
– Mutual Funds
– Stock Market

2. Lend – give lower returns, lower risk. Examples are
– Bank products – banks with high yield savings rates, Time deposits, etc
– Government Securities – Bonds, Bills, Goods
– Corporate Bonds
– Insurance, Pre-need, etc

When do I know if I buy or lend? There are 4 variables.

1. Age
Age 50 above – should be on lend type of transaction
Age 49 below – should be on buy type of transaction

2. Goal

3. Economic Condition of the country that you’re investing in.

4. Experience in Investing

“Invest for a purpose, have a goal with a clear time frame”

“Absolute Amount strategy – once you meet your target, remove the greed and cash out. Invest into another instrument.”

“Enjoy the benefit.”

“It is important that you secure the gain amount.”

“Be Disciplined, decisive and determined in meeting your financial target.”

With such free information in the Internet, and I meant from experts trying to reach and educate people about how we can grow our money, it’s almost impossible that we cannot improve our lives. If you let this information pass, BIG certainty is you’ll have enormous REGRET in the future. Start working on your financial plans. Today is always the best time.

Credits to the owner and people in the video.  Thanks for sharing.