Where will you put $5000 a month?

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  1. #21

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    Quote Originally Posted by Claire ex-ax:
    If you don't know what you are investing in, don't invest. It's that simple. So reading up is your priority or you'll end up like those people who put their entire life saving in Lehman mini-bonds!
    I think that's a bit drastic as an advice... There's a big difference between put a few K's a month in some investments and dumping everything into one vehicle.

    I think reading is important but until you have some vested interest, it's very theoretical.

    I think that an important step is to go into a bank and see what they have to offer you. That's the simplest way to start... The you can do a little reading on what they are offering and what kind of risk that implies. Then depending on your level of comfort with risk, you balance between capital protection and reward. Putting money into a time deposit is hardly worth the effort these days... all that it does I guess is forces you not to spend it. Better a few hundred dollars than nothing some will say...

    Funds or unit trusts will generally have lower amounts that can be invested and they are professionally managed and diversified to spread risks. Buying one stock means you live or die by that one stock and in any case, in HK they are sold by blocks of 400-500-1000. You may be able to afford a cheap stock but this weill be very high risks, blue chips which are more established and less risky stocks are a lot more expensive. HSBC for example would cost you a little under 40K to get one block of shares.

  2. #22

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    invest it in your belly, Go out boozing as much as possible and watch your belly grow. I have invested quite a lot into mine. LOL


  3. #23

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    gilleshk: I was kind of paraphrasing Peter Lynch, although he was referring to individual stocks... Graham says a similar thing.

    "Investing without research is like playing stud poker and never looking at the cards."

    Last edited by Claire ex-ax; 29-10-2008 at 12:51 PM.

  4. #24

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    Quote Originally Posted by Claire ex-ax:
    If you don't know what you are investing in, don't invest. It's that simple. So reading up is your priority or you'll end up like those people who put their entire life saving in Lehman mini-bonds!

    But basically mutual funds pool money from lots of investors to buy securities, such as stocks, bonds, money market instruments, etc. A couple of advantages of mutual funds is diversification and professional management.

    Now go and getting reading; then you'll be able to ask specific questions. Happy reading!
    Oh, I know about mutual funds. I didn't know that they are also called just "funds" for short. I've always been under the impression that most mutual funds are more expensive than individual stocks.

    But you're right about those Lehman mini bonds, I do not know much about it but it sounds like something I might have plunked my money in based on my current level of knowledge on these things.

  5. #25

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    Quote Originally Posted by gilleshk:
    I think that's a bit drastic as an advice... There's a big difference between put a few K's a month in some investments and dumping everything into one vehicle.

    I think reading is important but until you have some vested interest, it's very theoretical.

    I think that an important step is to go into a bank and see what they have to offer you. That's the simplest way to start... The you can do a little reading on what they are offering and what kind of risk that implies. Then depending on your level of comfort with risk, you balance between capital protection and reward. Putting money into a time deposit is hardly worth the effort these days... all that it does I guess is forces you not to spend it. Better a few hundred dollars than nothing some will say...

    Funds or unit trusts will generally have lower amounts that can be invested and they are professionally managed and diversified to spread risks. Buying one stock means you live or die by that one stock and in any case, in HK they are sold by blocks of 400-500-1000. You may be able to afford a cheap stock but this weill be very high risks, blue chips which are more established and less risky stocks are a lot more expensive. HSBC for example would cost you a little under 40K to get one block of shares.
    Thanks, gilleshk. This is really the kind of information I need that's probably available in books but one that I will probably miss if it's not highlighted well enough. I totally agree about the theoretical thing.

    I'm a bit intimidated about talking with the banks though; considering the small amount that I'm investing.

  6. #26

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    cd: Some funds are expensive but some are cheaper; for example, Fidelity has funds which require a minimum monthly investment of just HK$1,000, after an initial minimum investment of HK$1,000. But these are load funds and there is a sales charge of 3.25%.


  7. #27

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    Quote Originally Posted by wtbhotia:
    invest it in your belly, Go out boozing as much as possible and watch your belly grow. I have invested quite a lot into mine. LOL
    I don't drink and I don't smoke. But don't worry I've got the fun stuff covered.

  8. #28

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    Quote Originally Posted by cdtan99:

    I'm a bit intimidated about talking with the banks though; considering the small amount that I'm investing.
    You are investing 50% of the average monthly income of a person in this city. That's not a small amount by many standards - there will be people in the banks who can help, although I'd do my research first to be honest or they will just sell you the product that makes THEM the most money, not the one you need (eg the minibonds... sold by banks all over HK!).

  9. #29

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    Banks only promote funds because they can charge you 3-5% of your money. The only ones sure to make money are they.

    You can buy shares tracking the HSI (I don't remember what they are called) and won't need to pay charges. Once the dust is settled (in a few months), they should be a good investment (if you can wait a few years).


  10. #30

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    Quote Originally Posted by pinko:
    You can buy shares tracking the HSI (I don't remember what they are called) and won't need to pay charges. Once the dust is settled (in a few months), they should be a good investment (if you can wait a few years).
    The HK Tracker Fund (stock: 2800), which is excellent because it tracks the HSI, trades like an individual stock (so cheaply) but also pays dividends as if you held the underlying shares.

    The problem though is that $5000 per month is such a small amount that you'll lose over 2% straight away in trading costs.
    Last edited by PDLM; 29-10-2008 at 04:29 PM.