I want to share with you the "commandments" I followed before dipping my toes into the world of investing.
- Thou shall not invest without a goal
- Thou shall not invest without at least 3 months of emergency fund
- Thou shall not invest without any kind of health protection
- Thou shall not invest without studying. The knowledge that you gain in books and/or seminars is priceless.
- Thou shall not invest on a borrowed money
- Thou shall not invest without knowing your risk tolerance by asking yourself,"if my X amount of money invested is down by 50 percent tomorrow, how would I feel?"
- Thou shall not invest without psychologically parting yourself with your money. You might not see your money ever again
- Thou shall understand that in investing, high risk equals high returns. Go out from you comfort zone once in a while
- Thou shall not invest without fully understanding that market goes up and down. You might have a heart attack when your portfolio is all red and bloody
- Thou shall not invest without knowing what the company you want to put your money is selling. Get to know the management as well
And when you become an investor and you already grasp what if feels like inside the world of investing:
- Thou shall not be too proud, the market will eventually humble you
- Thou shall share your knowledge to anyone who is willing to listen. We will help Philippines get out from the "third world country" label
After all is said and done, thou shall trust the hardcore studying that you did early on and let time and compounding interest be your allies.