There are plenty of ways to make money. You can make money actively by having jobs to get monthly paychecks, or you can do it the passive way, which is through investing. Investment is actually broad, as it covers many different avenues, including real property investing, investing in a business, or even the stock market. Lately, stock market investing has been popular, especially in Malaysia.
Is Stock Market Risky?
Yes, it’s true that the stock market can be rewarding when done right. However, there are still many people who lost their investment capital simply because they did not know who to invest properly. This is why most people actually lose money in the stock market. And things are worse for those who invest on margin. The stock market can be quite a scary avenue.
Should We Stay Away From It Then?
Should you stay away from investing because of the risk? Definitely not. Instead, you can learn a right and proven way to properly invest, or in Malaysia, we can say “belajar saham sampai pandai“. Instead of treating the stock market as a casino, we can all look at the best investors and learn from them. One of the legendary investors is Warren Buffett. Buffett’s investing philosophy is simple, that is to invest in value.
Look at the Business Model before Investing
According to Warren Buffett’s investing philosophy, an investor should first learn about the business they want to invest. This can be done by getting to understand the business’ services and products better. The rule is simple, if you don’t understand the business model, stay away from the stock altogether.
Look at the Management
Just like any business venture, having the right management is key. The same rule applies to stock investing as well. Buffett recommends that the investor evaluate the management first. Do they have a good track record? Are they experienced in the industry? How long have they been serving the company? And, are they also investing in the company they run?
Only then, you look at the price
Once all these fundamentals are in check, only then an investor should consider investing in it. This brings it down to the final move, that is to know what is the right buying price. Unlike traders whose price means everything, value investors only look at price so that they can buy a stock when it is undervalued.
Always Think Long Term
Mindset is also important. When it comes to stock investing, the price fluctuation gives investors an emotional roller coaster ride. This causes some to sell their stock the second it dips, or the moment they make a sudden significant gain. This is why you should equip yourself mentally and emotionally so that you invest with a clear mindset.
Is there a place to learn value investing the practical way?
If you would like to learn about investing, there are a lot of great sources to learn from. In Malaysia, especially if you are interested in shariah-compliant investing, you can visit Labur Saham Syariah website via this link: https://labursahamsyariah.com/belajar-saham/. Through this blogger site, you can enrol for a free investing class to learn the fundamentals of investing.