Sorry for not posting these past few days as I was suppose to do.
My mind got a bit clouded with stuff that includes the Stock Market.
For now, let's get back to Personal Finance shall we?
When I was still dependent from my parents, getting a loan from them was easy. They love me and they would forget about it. However, as a grown adult, that won't be the same since my parents have their own needs and they might be the ones who would need my assistance in the future.
In the corporate world, there may be times that we may need to borrow money to take care of our personal needs. These may include (but not limited to) the following.
a. Leverage for an Investment
b. Medical Expenses
c. Educational Expenses
d. Housing Repair/Improvement
I'm sure you have more that what is listed above but that's for now.
Anyway, My own criteria to consider before getting a personal loan would be the following.
1. Do you really need it Right Now?
Say you need this amount for you to cover your kid's education for the coming school year and that would be six months from now. When you try to loan that amount, what would you do for the next six months aside from paying the loan (plus interest)?
For me, I'd rather delay it and work my budget for the next six months to be able to come-up with the money needed. In case if it isn't enough, that's the time I'd get a loan, but a lower amount compared to what would be the initial loan amount.
2. Can I pay it within the shortest time possible?
Give that you were granted a loan amount you needed, can you pay it within the shortest amount of time possible? Say you need to pay it within a year, but there are unavoidable instances that you need to use that money that should have been for loan payment for something else. Would you extend your loan payment to make-up for the loss? Would you borrow money just to pay for that payment (which leads to additional debt)?
That's my take. Do you have any other ideas? Feel free to share yours in the comment section.
Monday, June 5, 2017
Tuesday, May 16, 2017
28. Swabeng Discussion: Lots and Lots (Board and Odd)
Whenever you trade a stock, have you noticed the amount of shares needed for you to buy or sell a stock? While you may buy a stock on a per share basis, there is a standardized way of trading them.
For starters, a board lot is defined as a standardized number of shares for a specific price range. This facilitates easier trading.
Let us refer to the table below.
Lets say you're interested to invest in Jollibee (Stock Code: JFC) on May 10, 2017 and you want to buy 100 shares. You need to check the price range for the stock. Upon checking you noticed that it costs 211.00 pesos (at the close). From there, when you checked on the table it is within the 200 to 499.8 peso range which means that the minimum number of shares for JFC would be 10 shares or equivalent to 1 board lot. Since you will be buying 100 shares of JFC, this means that you'll be buying 10 board lots of JFC.
Now, lets say someone gave you 4 shares of PLDT (Stock Code: TEL) and you wanted to sell them since you have already profited from it. Upon checking on the board, the number of your shares is not listed, hence you have to sell them via Odd Lot hoping that there are buyers out there who can match the number of shares and the price that you intend to sell the stock. Anyway, these are very seldom cases when you got to hold a stock that is an Odd Lot.
Till the next topic.
For starters, a board lot is defined as a standardized number of shares for a specific price range. This facilitates easier trading.
Let us refer to the table below.
Lets say you're interested to invest in Jollibee (Stock Code: JFC) on May 10, 2017 and you want to buy 100 shares. You need to check the price range for the stock. Upon checking you noticed that it costs 211.00 pesos (at the close). From there, when you checked on the table it is within the 200 to 499.8 peso range which means that the minimum number of shares for JFC would be 10 shares or equivalent to 1 board lot. Since you will be buying 100 shares of JFC, this means that you'll be buying 10 board lots of JFC.
Now, lets say someone gave you 4 shares of PLDT (Stock Code: TEL) and you wanted to sell them since you have already profited from it. Upon checking on the board, the number of your shares is not listed, hence you have to sell them via Odd Lot hoping that there are buyers out there who can match the number of shares and the price that you intend to sell the stock. Anyway, these are very seldom cases when you got to hold a stock that is an Odd Lot.
Till the next topic.
Thursday, May 11, 2017
27. Swabeng Discussion: The Two Types of Stock Market Players in General
Now lets move on to this topic.
I've seen several types of players in the Stock Market based on reading. But for the mean time, I'll classify them in general.
1. Traders: These are stock market players that mostly rely Technical Analysis on charts, indicators and price action for their buy and sell signals. These type usually disregard any news as they focus more on the technical aspect of the stock and its movement. These are typically active people and who are mostly alert. They can hold a position (of a stock) from as short as a few seconds to as long as a year (or sometimes two).
2. Investors: These are stock market players that mostly focuses on the fundamentals of the company. They usually invest for the long term (mostly more than 2 years) up to the time that either they're old already to pass on the shares to their heirs or a couple of years when the company has solid earnings already. They use fundamental analysis to determine the soundness (how strong the company) of the stock. These people are not affected with the noise (hype and bash) and the price movements (charts) regarding their position of the stock and always look at the bigger picture (Company's Growth). Not that they are the passive type but rather they're in for the long haul.
3. Hybrid: These are the type of Stock Market players that has a combination of skills of a trader and an investor. While hybrids read reports, financial statements and news for fundamentals, they also rely on technical skills to determine the best time to enter and exit the trade. Hybrids can hold a position from a few seconds up to a few years depending on how their stock goes. This is where each one of us here should strive for.
Anyway, which of the three types would you go for?
I've seen several types of players in the Stock Market based on reading. But for the mean time, I'll classify them in general.
1. Traders: These are stock market players that mostly rely Technical Analysis on charts, indicators and price action for their buy and sell signals. These type usually disregard any news as they focus more on the technical aspect of the stock and its movement. These are typically active people and who are mostly alert. They can hold a position (of a stock) from as short as a few seconds to as long as a year (or sometimes two).
2. Investors: These are stock market players that mostly focuses on the fundamentals of the company. They usually invest for the long term (mostly more than 2 years) up to the time that either they're old already to pass on the shares to their heirs or a couple of years when the company has solid earnings already. They use fundamental analysis to determine the soundness (how strong the company) of the stock. These people are not affected with the noise (hype and bash) and the price movements (charts) regarding their position of the stock and always look at the bigger picture (Company's Growth). Not that they are the passive type but rather they're in for the long haul.
3. Hybrid: These are the type of Stock Market players that has a combination of skills of a trader and an investor. While hybrids read reports, financial statements and news for fundamentals, they also rely on technical skills to determine the best time to enter and exit the trade. Hybrids can hold a position from a few seconds up to a few years depending on how their stock goes. This is where each one of us here should strive for.
Anyway, which of the three types would you go for?
Saturday, May 6, 2017
26. Swabeng Discussion: Earning through The Stock Market by Dividends
That Price Appreciation for the previous post was quite exciting right? Anyway, here is the other way to earn in the Stock Market
2. Dividends
As a part owner of the company, aside from the gains that you have earned (or losses incurred), you will be rewarded with dividends. These dividends can be in a form of cash (called cash dividends) or extra stocks (stock dividend).
1. Lets say at April of 2012, you bought 10,000 shares of Jollibee (Code: JFC) and you didn't add more share up to the present day. Aside from the price appreciation that you've gained, you will earn cash dividend per stock (refer to the table below)
Starting from the bottom part, a 0.58/share, cash dividend for that period would yield 5800 (excluding 10% witholding tax). The for the 0.65/share, cash dividend for that period would yield 6500 (excluding 10% witholding tax) and so on. When you add up all of the cash dividends on the table, it would give you 64,890 pesos (net of taxes). Not bad right?
Can you imagine if you bought more than 10,000 shares (lets say between 50,000 to 100,000 shares), I'm sure you'd be very delighted with your earnings through cash dividends.
That's for Cash Dividends.
Stock Dividends would be a different matter since you'll be rewarded with an additional number shares as the company has earned for a certain period (quarter or semi-annual or annual). I'll try to look for a better explanation for Stock Dividends.
That's all for now.
2. Dividends
As a part owner of the company, aside from the gains that you have earned (or losses incurred), you will be rewarded with dividends. These dividends can be in a form of cash (called cash dividends) or extra stocks (stock dividend).
1. Lets say at April of 2012, you bought 10,000 shares of Jollibee (Code: JFC) and you didn't add more share up to the present day. Aside from the price appreciation that you've gained, you will earn cash dividend per stock (refer to the table below)
Jollibee Dividends
Starting from the bottom part, a 0.58/share, cash dividend for that period would yield 5800 (excluding 10% witholding tax). The for the 0.65/share, cash dividend for that period would yield 6500 (excluding 10% witholding tax) and so on. When you add up all of the cash dividends on the table, it would give you 64,890 pesos (net of taxes). Not bad right?
Can you imagine if you bought more than 10,000 shares (lets say between 50,000 to 100,000 shares), I'm sure you'd be very delighted with your earnings through cash dividends.
That's for Cash Dividends.
Stock Dividends would be a different matter since you'll be rewarded with an additional number shares as the company has earned for a certain period (quarter or semi-annual or annual). I'll try to look for a better explanation for Stock Dividends.
That's all for now.
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