Investing for greater financial freedom

In March, Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz said that 40 percent of millennials were spending beyond their means.

This can be attributed to a lack of financial literacy, a fact which has been repeatedly mentioned in the media for the past few years.

Stock investing is a great way to generate passive income (Source: Unsplash)

Fortunately for Taylor’s University students, a Zoom webinar was held on 2 October titled “Power Up Your FQ!”, which aimed to increase one’s financial quotient, or ability to understand how money functions, within the context of investing.

The event, which featured international financial speaker and investor Shane Choo, was organised by the Bursa Young Investor Club of Taylor’s University (BYIC).

At the beginning of the webinar, Shane cited economic inflation and growing material needs as valid reasons for wanting to invest.

As for why participants should invest in stocks in particular, Shane said that it allows people to make money with just electronic devices, it is less troublesome than property investment, and most importantly, it has a low capital requirement.

Participants were then shown the types of transaction costs involved as well as economic factors that could potentially affect the share price.

To evaluate stocks, Shane advised doing a fundamental and technical analysis of the targeted company, noting that one did not have to master both techniques to succeed in the stock market.

However, as for whether one should trade or invest in stocks, Shane said that it depends on our risk threshold, with trading suggested for high-risk takers and investing for low-risk takers.

“A successful strategy may prove disaster for another person because it does not fit with their personality,” Shane said.

Shane also recommended identifying investment-grade companies by seeing if they were making consistent profits, had conservative debt financing, a strong cash flow, and a proven track record of increasing dividends each year.

In the final Q&A session, Shane taught participants how to read a stock chart amid other insights.

Yon Hui Ching, a BYIC member who joined the event, said that she found the contents of the webinar suitable for investment beginners.

She said, “I got to know new information in the Q&A section of the webinar.”

“By knowing how to invest, students will be able to have a better life and get better ideas on managing their money,” Hui Ching added.

For students wanting to further develop their financial quotients, the Bursa Young Investor Club frequently organises activities to improve youths’ investment and entrepreneurial skills.