Mark, The Young Investor

This is my cousin Mark. He just finished high school last March. Aside from the obvious (that we share the same genes, and therefore, we look alike), he is also smart (it runs in the blood). Haha.

But he used to be a bottom feeder. He would fail most of his quizzes, he would rather go to SM or play table tennis even if it was exam week, and I can not explain enough that being good looking (or being my cousin, for that matter) would make him pass in my subject (I was his teacher in English in his sophomore year). But since that talk we had once (because we rarely spoke outside the classroom), he started to effort in his studies.

[Fast forward: he was third honor in the last two years of high school. Nothing is really difficult if you put your mind into it.]

There were many changes in him that I started to notice, especially when he started to hang out with me and my sisters. He put aside his playing computer games and watching anime, while he learned to be concerned about his grades. There is a lot more that I see changed for the better, but the most notable is about his spending habits.


His parents being both in the states, he used to not value money. "Money is created to be spent anyway." He would buy new clothes or new discs for his PS3 every time we would go to SM (and that's about once a week). But that was before.

Mark would sometimes come to our house, since our houses are connected by a passage way. He would watch CSI:New York or Bones with us (my sisters and I) in the common room. But one time, the TV was off because I was reading Bo Sanchez's "My Maid Invests in the Stock Market". He asked what's the book about. I said, "It's about growing your money faster than in banks."

I noticed that he was listening intently as I was explaining.

So, I asked, "Why? Would you want your money to grow?"

He said, "Umm, yes. But..." Since there was "but", I disengaged and went back to reading.

He asked again, "How do you grow your money that fast?"

I said, "In the stock market." Obviously, he looked puzzled, and everything I said was Greek to him.

So, fast forward again, I made things simple for him. I opened an account under his name at Accord Capital with an initial investment of P 5,000 (this is the minimum for students). He deposited P 1,000 pesos per month for 3 months. I bought P 2,000 amount of shares every month and I would show him what I bought for him every time I'd put an order.

After the third month, he saw that he was earning well from Manny Villar-owned $VLL (Vista Land Properties). I applied peso-cost averaging (PCA) in this instance. In the 4th month, he decided that he was going to put P 2,000 pesos monthly, instead of P 1,000. Plus, the gifts he received that Christmas, the money his mom sent him-- and all the money he not really needed, he put into his account. We bought another good company, $MBT (Metrobank). And then, another, $PF (Purefoods). [You notice that all these companies that we bought are the ones we believe in, and whose products/services we really consume.]

Good thing it also happened that when we bought these companies around December-January, we were able to bottom-pick them. Along the way, we decided that we were contented with the profit, we sold and bought some stocks with the help of our friend who does charts and is good with technical analysis, PAM. By the end of May, this was how his portfolio looked like (from all his deposits amounting to P 48,000.00, it has become P 57,401.44) :

It must be noted, though, that if you do not know how to time the market like PAM does, I don't advise buying and selling stocks every so often. You will only be making the broker richer from commissions.

By the start of July, Mark decided to liquidate. He said he wants to sell all his equities. When we sold everything, we netted around P 58,150.00. He got scared that all stocks were starting to peak, and that at any moment then, he thought, the market was going to crash like this:

But, what can I say, PSEi is resilient. He just watched the market go up even more. But I told him, a gain is a gain. Do not ever regret selling at a gain, it's almost impossible to catch the top. Or, at least, to catch it every time. Mark's fund is now in the safekeeping of mamang. I heard they opened a bank account for him.

As I have said again and again, my only regret right now is that I did not start saving up and investing early on like Mark did. Instead of spending on things that are not really necessary, one can grow his money well in different investment tools out there, the stock market is only one of them. And with this that he has already started, I like to believe that he's going to be rich when he grows up. He now saves his money in the bank whenever he receives some from his parents.

I believe that everyone can do this, too. If you start setting aside a small fund for your investment now, by the time you graduate from the university, you will have been ready to invest in other more sophisticated kinds of investments. And there are many sites out there which can help you with your decision-making. I can also give you my opinion about things if you ask. But the decision will have to be made by you.

Note, also, that the August (ghost month) is fast approaching. If you are a starting investor, I recommend that you open your own account before the great sell down so you can get the blues (blue chips) at a good bargain.

Just remember this before you do anything: investigate before you invest. Happy investing!