Whether you decide to pursue investing in stocks seriously and for the long term or not, you will definitely have a learning experience and absorb a new store of knowledge that is extremely interesting and useful.
Vietnamese society and Eastern cultures in general place great emphasis on the culture of thrift. While the world has five continents, six out of ten countries with the highest savings rates are in Asia. Vietnamese young people are mostly used to parents and grandparents depositing a large part of their money in banks besides other traditional forms of investment such as real estate.
However, in the era of integration and internet, along with the development of population income and economy, the stock market is expected to receive more and more attention and will become more familiar. with Vietnamese people, especially young people. And before you buy your first stock, keep these four things in mind.
1. Understand the nature of stock investment
Stock investing, to explain in the simplest terms, is an investment in shares of listed companies, institutions or funds. Currently, Vietnam has two stock exchanges in Hanoi (HNX) and Ho Chi Minh City (HOSE). Buying shares on the stock exchange allows you to own a piece of a listed company.
In other words, you are a shareholder, no matter how big or small the investment. For starters, the two main sources of income from investing in stocks come from receiving dividends or profits when trading stocks. Whether to invest long term or short term completely depends on your investment strategy and goals.
2. Learn about financial analysis and target company
Before putting money down, it is extremely important to learn to have an overview of financial analysis. You want to understand what metrics like market cap mean (market capitalization, which is the number of shares multiplied by the current value of each company's stock), or price/earning ratio (ratio) price and earnings), along with company growth metrics such as growth in sales and profits.
As a beginner, you may not be in-depth, but an overview of macroeconomics and financial statements will help you make better decisions!
3. Risk management
One of the reasons why stocks are so attractive to investors is the opportunity for high returns. This opportunity comes from investing in stocks that are riskier than other forms such as saving in a bank, or buying bonds, a form of lending instead of an investment. The wisest investors have a piece of advice to reduce risk, always diversify your portfolio.
Instead of just investing in one company, or one business, a savvy investor spreads their investment. Not only investing in technology companies with potential but also very risky, they will invest in long-term companies, although growing slowly, but safer in the food industry, construction ...
4. Start small
Once you feel excited enough and confident in your knowledge of the stock market, you are ready to start. Start with a small amount, an amount that even in the event of a loss will not affect your life.
Starting early will help you get into the habit of daily market updates, familiarize yourself with the stock's rhythm, and gain a better understanding of the world around you as every political and social upheaval affects the market. stock market.
Whether you decide to pursue investing in stocks seriously and for the long term or not, you will definitely have a learning experience and absorb a new store of knowledge that is extremely interesting and useful.
When starting a new field, investors often face certain difficulties in learning, so choosing a securities company to start is also a reasonable choice.
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