Find out what you need to be aware of and how to do it:

Looking for higher return on investments; the next big individual run-up; willing to take on higher risks; there is no magic you need to buy low and sell high. Now we all know it’s not that easy, so to maximize your chances

you must be able to understand basic accountancy principles, a company’s annual report, stock market history and financial news.

Then, you need to define your goal and plan on how achieving it (your goal towards financial satisfaction).

The biggest question for the “amateur” investor would certainly be “How much money do I have to invest?” Although, you should always try to figure out first – “How much money you can afford to lose?”,

So, be sure you:

1. Only trade/invest money you can afford to lose!
2. Do not jeopardize the future of yourself, your family, by investing all your assets in unstable stocks; DIVERSIFY (in the nature of your investment, so not just stocks), look into real-estate, other businesses…
3. If you have a stable monthly/annual income, keep at least 6-9 months living expenses for you and your family in your savings account before you start investing with the “extra cash”.
4. Don’t look at it like a source of revenue that would take care your basic living expenses; Look at it like a source of funds that would allow you to buy “the extra stuff “ you don’t really need.
5. Never invest in stocks or any kind of funds if you already have a bad debt, credit card debt or any other high debt.
6. Finally, be ready to make mistakes and learn; Do not go against a “trend” and cut your losses short; Furthermore, you don’t have to let your emotions interfere with your daily trading (sell if you were wrong and don’t keep it hoping it’s going up again)

Now, once you figured out you have enough savings to start trading, go ahead and:
“Open an account with a broker”

There are two kinds of broker with which you can start with: Discount Brokers and Full-service brokers.

Discount brokers cater well if you are willing to do your own research and make your own investment decisions.

Start by finding one that fits your needs at best, i.e.: maybe with the lowest commissions per trade, or located in your home country or who deals specifically with Asian markets.
Some famous examples include: Interactive Brokers, Charles Schwab and TD Waterhouse. If you decide to go for less famous ones out of your home country, be sure they are certified, Google the company name and check records. For instance, “BOOM Securities” in Hong-Kong: gives access to almost all Asian markets and is a fully licensed broker.

Register, send the required documents, get your private access and buy your first stock!

Go for a “full-service broker” such as “J.P. Morgan”, “Barclays”, “Deutsche Bank” if you wish to have access to more markets, be given “expertise and advices” and don’t have the time to do your homework. If you choose the “service” then you will also pay higher commissions and fees than you would with a discount broker.

Finally, you should be aware that most Asian markets are open to foreign investors except India (closed to non-indians). Some exceptions exist in China or Thailand but you shouldn’t be too concerned if you just started “trading”…

So to begin with, stick with the larger markets

where you will have plenty of choice and don’t bother looking into complicated deals. If you’d ask me which one to choose between a “full-service” or a “discount” broker, I’d say go for the discount broker if you know what the basics are (P/E Ratio, P/E Growth Ratio, ROE, ROI, EPS, Dividend Payout Ratio, Net Asset value, Turnover & Leverage Ratio, Current Ratio) or go for a full service broker if you have no idea of what you just read.


A.S.- partner @ dragongate.asia