The secretary-general of the Investment Analysts Association recommends that investors should study before investing.


The Secretary-General of the Investment Analysts Association recommends that new investors should study the details before investing. In particular, you must be careful of misunderstandings. Because life can change to a bad place.

Mr. Sombat Narawutthichai, secretary-general of the Investment Analysts Association, said investing has both opportunities and risks. Not investing at all closes off the possibility of an unfortunate future, but don't be overconfident. Because the chance of guessing incorrectly can happen sometimes. By many years ago The fact that bank deposit interest rates have been as low as 0.50-1.50% for a long time has resulted in people interested in investing in assets for investment, including stocks, gold, funds, bonds, or even crypto. A lot together Which is a good thing. That Thai people have found a way to save money in a form that is more than just depositing money in a bank. with statistical information and there is strong academic reason supporting that Investment assets have better long-term returns than deposits but also carry a correspondingly higher risk.

For various investment principles such as knowledge of the assets being invested. Diversification of investment risk analytical knowledge Investment techniques and strategies You, the reader, have probably seen it. We've heard this quite a lot. In today's article, I'm going to touch on some points about investing that we must be careful of misunderstanding. Because life can change to a bad place. There are the following issues:

About stocks Many of you know that Use the principles of investment diversification. So it's spread across many stocks. But many stocks are all the same type of business. Business times are bad. So it's all bad. For example, invest in all travel-related stocks. Then came across the COVID situation for a long time. In fact, shares must be distributed among many businesses. (which has been selected and the business outlook is good)

Choose stocks that have a lot of trading volume, which means that the stocks are good and have a lot of people buying them. This is partially true. But there are many stocks that are not true. Especially stocks whose current performance has never shown any promise. There were only news and astonishing visions. In this case, apart from having to check the financial statements, look at profit and cashflow, I recommend going to see if there is a fundamental analysis (IAA Consensus) on Or not? Normally, even though analysts don't write about medium to small sized stocks because they don't have enough manpower. But if it is a stock that is traded a lot and is a good company Analysts will definitely not be left alone. There must be many people involved in the analysis, so if there aren't any or there are only 1-2 cases even though there is such a large volume, please think carefully.

The futures market provides an opportunity to make profits both up and down. In this case, it is an opportunity for those with good strategy to predict the correct direction. Therefore, we must understand the same thing. If you guess wrong, you incur a loss. Therefore, you should not invest heavily here because you understand that you will make good profits both on the ups and downs.

Gold: According to news reports, we often see the word gold as a safe haven. Many people understand that it is a safe asset, not risky. This must be learned that According to statistics, it is clear that gold is a risky asset whose prices fluctuate quite violently. Yearly statistics sometimes increase for 7-8 consecutive years, totaling hundreds of percent. But the downturn was bad for 3-5 years, with a total downturn of 30-40% at once, but on average it was considered a long-term profit, averaging 6% per year. Therefore, even for us, including me. If you are interested in investing in gold, you must understand that It's a risky thing. There is a chance that it will go down a lot at times. All in all, gold is interesting. But you shouldn't give it your all. The money should be distributed among other financial assets as well.

Many people have heard that Debentures are less risky than common stocks. So if you don't want to risk a lot. I play bonds. This is true in the case of general averages, and it is certainly true in the case of bonds relative to common stocks of the same company or with the same level of risk. But because bonds are issued by many companies. Therefore, there are very different levels of risk. Some companies have high or relatively high credit ratings (Investment Grade) and are therefore able to provide low interest rates. But some companies have a credit rating lower than Investment Grade, which is classified as Speculative-grade Bond, sometimes called the annoying name Junk Bond. In addition, some bonds that are sold To the point that no credit rating has been announced at all. This requires extreme caution.

Even though the interest rate is set at a very high rate of 6-7% per year, it is not necessarily the most attractive because it earns the most interest. Also, don't think that it's still less risky than playing stocks. Because in the actual situation, there were some corporate bonds that were unable to pay back the money. while common stocks of good companies in the market It still has strength in operating results and financial position. In the long run, if the price goes down, there is still a chance to go up again. Pay dividends regularly If you want to sell good common stocks, you can easily sell them immediately. It looks more interesting than investing in Junk Bonds during a time when the economy is not good like this.

The saying that if you don't sell, you don't make a loss, this point is probably a teaching that will lead you into the abyss. Because this term will be effective only if the stocks you hold have good businesses. There is no business crisis situation or economic situation that has changed for the worse. In that truth If the stock price goes down, you have to accept the fact that you are losing money. As for whether to continue fighting or surrender just here. It is another step. Therefore, in the case that the stocks we hold have a business crisis. or crisis of credibility If you don't sell it, you can lose it.

It's better to go into stocks following Mr. ABC. He used to play and make hundreds of percent profit until he was rich. He shouldn't have missed this issue. You shouldn't be so confident. Because past profits do not guarantee the same in the future. Including people who used to make a lot of profits In some cases, it may come from playing bravely and guessing correctly. In addition, we have probably seen people playing after people who have made good profits. The next time we invest with confidence, we will still lose. Therefore, we may have to see first whether Mr. ABC has reasonable principles. Is the method of choosing good investment stocks worth studying and learning about? If so, we try to study and learn according to their methods. And if there is an analyst's fundamental analysis, please look at it. It was taken into consideration for reasonableness. In the end, we are the ones who make our own decisions based on the information. It's better than following other people without looking at the content.

Ultimately, however, investing involves both opportunities and risks. Not investing at all closes off the possibility of an unfortunate future. But you must not be overconfident. Because the chance of guessing incorrectly can happen sometimes

Source: Thai News Agency