Like Tree15Likes
  • 3 Post By Neon
  • 8 Post By tck
  • 2 Post By chuckster007
  • 1 Post By DimSumBond

In need of investment advice

Closed Thread
  1. #1

    Join Date
    Aug 2018
    Posts
    2

    In need of investment advice

    Hello everyone,

    Before anything I would like to mention that I have no basic knowledge on any investment or any stock market. I didn't even graduate Highschool so you could tell that I'm not really a smart cookie.

    I recently turned 22 and have around 130k HKD saved up in the bank by working here and there. I have a feeling that my money in bank could do much more than just sit there. I can put aside 10k HKD a month in the bank and I have no plans to move elsewhere atm.

    Any ideas as what I could do to make it grow? I know there are risks involved but I was taught to fall down and get bruises to learn how to ride a bike so any suggestion is welcome. Thank you

    chuckster007, shri and markranson like this.

  2. #2

    Join Date
    Feb 2005
    Location
    Manchester, UK
    Posts
    7,790
    Quote Originally Posted by Neon:
    I recently turned 22 and have around 130k HKD saved up in the bank by working here and there.
    Definitely WELL DONE on saving that much for your age and education background, There will be some great members coming by to give you some good advice. I suck with money so I can only congratulate you
    shri and markranson like this.

  3. #3

    Join Date
    Jan 2018
    Posts
    831

    Well done on building up a decent sized savings so far!! You are already showing your financial savvy.

    In Hong Kong, you have access to plenty of investment products. If you prefer to have your own investment strategy, sign up to a brokerage and place your orders. You do need to know that investing is not for weak stomachs. Day/ frequent trading can rapidly erode gains by giving away fees.

    If you want a more passive approach, there’s ETFs and mutual funds (watch the fees here) that could be of interest.

    Also bear in mind your liquidity needs (that is your cash flow requirements), investment time horizon and how much risk you can stomach (during corrections, 20% can be wiped off rather quickly). Also bear in mind FX and taxes if you choose to invest in assets domiciles in other locations (eg US).

    Start off off slowly and enjoy the journey. There’s plenty of other asset classes out there and derivative products that can amplify gains and losses too. Take your time to get to these though as they are quite risky if you don’t understand how the product is structured and whether they are leveraged.

    shri likes this.

  4. #4

    Join Date
    Aug 2018
    Posts
    2

    Thank you for your time in replying to my post above. I am planning to talk with my dad who is more knowledgable regarding stock and stuff and I'll mention the things that you've posted here.


  5. #5

    Join Date
    Dec 2013
    Location
    Hong Kong
    Posts
    12,323

    There is a really long thread on here about how to retire early which is full of investment discussions. Search for it.

    https://www.google.com/url?q=https:/...R-v_OjyGewqlDA

    (PS - more free advice - advice is plural and doesn't take an S)


  6. #6

    Join Date
    Jan 2016
    Posts
    732
    Quote Originally Posted by HK_Katherine:
    There is a really long thread on here about how to retire early which is full of investment discussions. Search for it.

    https://www.google.com/url?q=https:/...R-v_OjyGewqlDA

    (PS - more free advice - advice is plural and doesn't take an S)
    the guy has barely started, let him get some taste of real life before we show him rosy pictures on how to retire early

  7. #7

    Join Date
    Jul 2015
    Posts
    229

    I have this calculator I made for myself to see what different financial decisions or investments would look like. I put some of your details (of which some I had to assume) into the calculator to hopefully argue that you might want to consider investing in training yourself as opposed to in markets. This doesn't necessarily mean completing secondary and uni, but it could also be trades and vocations that you enjoy.

    Assume you are an average investor. You just invest in the Hong Kong basket of stocks with extra cash you have.

    (Historical 2800.hk as an estimate with 10% return and 20% standard deviation)

    Situation 1.

    Age: 22
    Income: 16,000 (median income for secondary education attainment 4-7)
    Savings: 130,000
    Monthly Spending: 6,000
    Monthly Savings: 10,000

    Situation 2

    Age: 26
    Income: 26,400 (median income for tertiary education attainment)
    Savings: 0
    Monthly Spending: 7,000
    Monthly Savings: 19,400

    You delay investing in the market and spend your savings training yourself to hopefully earn a more competitive salary, hopefully saving much more a month when you're done than you could in your current situation.



    Situation A Simulation Results:
    (Numbers are a little different from the first table because I had to re-run the monte-carlo simulation and things)

    Situation B Simulation Results:
    As you can hopefully see from the simulation, even though in situation B, you started investing later, and with less savings (just your monthly contribution), you still ended up much better off later in life. Maybe not so much by 30, but definitely after that. Additionally, your risk of running out of cash in case you are entering the market at a bad time is also less at 1.4% as opposed to 34%.

    In short, I just want you to consider spending your savings on self-improvement such that you can save even more in for the future. It will have a bigger impact than picking the right investments which nobody can guarantee. I know it might seem scary because of how hard you fought to save as much as you have so far. I'm not saying definitely do it, but consider it and talk to more people about it. Hopefully more people in the forum can advice. This is just my opinion.

    Maybe later on you can focus on your investing decisions to try an improve your risk/return, but that might be better for later.