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Education is an important part of our lives in Singapore. It is, in fact, compulsory for all Singapore citizens born after 1 January 1996. Not surprisingly, many Singapore students (and their parents) find themselves focusing a large part of their time and resources on their education in hope of excelling in school and eventually achieving success in the working world.
However, what we learn in school doesn’t cover everything that is needed to prepare us for adulthood. For example, one important area of life – personal finance education, isn’t taught in school.
But just because personal finance education isn’t covered in school doesn’t make it any less important. In order for us to live financially secure lives during our adulthood, we need to stay on top of personal finance matters. No amount we earn from our jobs is ever going to be enough if we don’t know how to manage money. And this doesn’t just entail saving but also investing excess savings to grow our wealth.
While learning to invest is seen as difficult and something that we should only think about after we start working, this isn’t necessarily true. In fact, in Singapore, we can already start investing on our own from the age of 18.
One young Singaporean who has started his stock investing journey is Wu Ye Kai. Currently serving his national service, Ye Kai started investing during his Junior College (JC) days at NUS High School of Math and Science right after turning 18. Since then, Ye Kai’s interest in investing has continued to grow and he transited into writing stock investing articles that are published on websites like Seeking Alpha and DollarsAndSense.
In this edition of #theeverydayinvestor, a content series in collaboration with Tiger Brokers (Singapore) that features everyday investors around us, we spoke to Ye Kai to find out what got him started on investing and writing on stock investing-related articles.
Timothy Ho (Timothy): It’s hard to find anyone who is interested in stock investing at 18, let alone, investing and also writing stock investing-related articles. What triggered your interest in the stock market?
Wu Ye Kai (Ye Kai): My interest in stocks developed in JC 1. Back then I was an avid gamer and I was playing this game titled Lords Mobile. The game had a very competitive pay-to-play environment and I was curious to find out how much the company was earning off the in-game purchases.
The company, IGG.com, was headquartered in Singapore and is publicly listed in Hong Kong. As I looked up its 2018 annual report presentation, I was astonished that the game I was playing – Lords Mobile was raking in US$600 million for the company! That was my first time looking at a company’s financial report. From that day on, I started developing a passion for the stock market.
Timothy: The first time we met, you were already writing for Seeking Alpha, a popular US stock website. How did you get started on that?
Ye Kai: When I first started reading financial news and analysis of big-cap companies such as Akamai, Corning and Netflix, I noticed that some of the articles came from sites such as The Motley Fool and Seeking Alpha. I found out that Seeking Alpha allowed contributors to write articles for them. Enthusiastically, I went on to write my first draft. A fun fact would be that my first submission was rejected quickly and the editors told me to start anew. Fortunately, my second article, after a few edits, successfully passed through the editors and I joyously watched the page views for my articles go up.
Timothy: How do you balance your time between your studies and your investment interest?
Ye Kai: Actually, it feels like having another CCA, except that I usually pursue it after my exams and during my holidays. School was quite busy as I was a member of my school’s Chemistry Olympiad team and I took on Chemistry honours (similar to H3 Chemistry). Once my exams end, I would be back at the library – not to study – but to read finance books.
Timothy: What are some challenges that you face as a young, student investor?
Ye Kai: As a young investor, the investing world seems foreign to me. When I started, I didn’t know what dividends, P/E ratio or EBITDA were. I didn’t take Principle of Accounts in school so I had to learn all these terminologies from scratch.
Fortunately, there are numerous online courses and websites that teach individuals who are interested in investing. In my math and science school, there were very few friends outside my economics class whom I could speak to regarding investing. Nevertheless, I would persuade them to join finance-related competitions with me, such as the National Cashflow Competition.
Timothy: Are there any individuals in the investment world whom you look up to and why? How have they influenced the way you invest today?
Ye Kai: George Soros is one of the investment figures I look up to. I first came across his name as I read about the impossible trinity: where it is theoretically impossible for a government to have independent monetary policy, fixed exchange rate and free capital movement.
Using this principle, he wagered against the English Pound in 1992, and earned US$1 billion in a single day. He repeated such feats several times: against the Thailand Baht in 1997, and against the Japanese Yen in 2013. In speaking about his investment success, one of his quotes stuck with me. “My approach works not by making valid predictions but by allowing me to correct false ones.”
To me, this means that we must recognise when our investment theses are wrong; and not keep holding them while the losses magnify. Oftentimes, emotion and loss aversion can get in the way of making good investment decisions. Thus, the investment discipline is the key to his investment success.
Timothy: Which platforms do you currently use to invest and why?
Ye Kai: I currently use Tiger Brokers. I find its digital platform easy to use and it has an extremely competitive commission fee. I previously contemplated using TD Ameritrade due to its headline-grabbing $0 commission for US stocks. Yet in terms of market access, Tiger Brokers has a wider range – offering access to the Singapore, US and Hong Kong stock markets. As such, I opened my first brokerage account with Tiger Brokers.
Timothy: What are some ways you improve your financial knowledge both as an investor and a writer?
Ye Kai: For anyone who is interested in investing in stock, I would suggest that the first thing to do would be to read more widely. Hardcopy books are great in helping you build the foundation in a particular area, such as value investing or momentum trading.
After that, internet guides could then further the knowledge while online courses can help you address misconceptions and test your understanding. Additionally, I urge readers to keep up with the financial news, such as by reading the Financial Times or DollarsAndSense. Lastly, if you like to understand the investment philosophy of successful investors, read their biographies, there’s so much to gain.
Timothy: What does your investment portfolio mean to you right now? How do you foresee yourself evolving as an investor, as you become older, with more experience and presumably, more funds to invest?
Ye Kai: My investment portfolio means the world to me. For me, it’s not paper money or money that I get from my parents. It’s my allowance from National Service – the long outfields, weary vehicle preparations and burnt weekends. As such, I handled every investment decision carefully: by researching the company thoroughly and writing a comprehensive investment thesis. As I grow more experienced, I would be comfortable with taking on larger positions and increasing my leverage. Moving forward, I would also hope to build my own computer programme to recommend stocks to me so I can narrow down my stock options.
Timothy: One advice that you will share with any student thinking of getting started in their investment journey?
Ye Kai: My advice is to start investing today. It’ll seem like a big leap to a foreign world. But take that leap. All the terminologies and processes involved might seem daunting at first, but trust me, you will slowly become more knowledgeable.
The market is the best teacher. I would also urge investors to find their own reason as to why they want to start investing, as it could be the biggest motivator in their investment journey. To me, the stock market gives people like me a chance to vote, to decide which companies deserve to succeed, and what ideas are worth investing in.
You Don’t Necessarily Need To Work Before You Start Learning How To Invest
There is a general perception that we have to start working before we can invest. After all, we need to have savings from our job before we can deploy them in the financial markets.
That said, there is no hard-and-fast rule that says we need to have a full-time job before we can start investing. For Ye Kai, saving a part of his allowance gives him some funds to deploy in the financial market. While he doesn’t earn a lot at the moment, the little savings that he has give him a good reason to read, research and analyse companies that he is interested in, before determining whether they are worth investing into.
For young investors like Ye Kai who want to invest both locally and internationally, having a brokerage platform that provides access to both the Singapore Exchange (SGX) and other major financial markets is important. With Tiger Brokers, investors can access the US, China, Hong Kong, Australia and of course, the Singapore market.
Also, commission fees are extremely important to look out for. After all, if we are only investing a few hundred dollars each time we invest, we certainly can’t afford to pay a commission that is going to be a significant percentage of our investment. This is where a low-cost brokerage platform like Tiger Brokers is vital. For example, through Tiger Brokers, we can invest in U.S. companies with a commission fee of just $0.005/share, with a minimum commission amount of just USD 0.99/order. If we invest in Singapore, this would be at 0.03% of our trade value with a minimum of SGD0.99/order. Do note that this excludes a small platform fee that may be charged. You can look at the full price details price that Tiger Brokers charge here.
One thing we like about the Tiger Broker App – Tiger Trade, is that it also helps us to stay updated with the financial market wherever we are, be it at home, in the office, or even in our army camp. The Discover tool on Tiger Trade allows us to follow the latest news that could affect stocks that we have purchased, or are intending to invest in. The Tiger Broker community also allows us to discuss investment news with other investors so that we can leverage the experiences that other investors have. This is useful not only for investors, but also for those who have yet to start investing.
So whether you are a young investor like Ye Kai who is intending to make your first investment this year, or just trying to learn more about the investment world before you put in money, you can open an account with Tiger Brokers once you turn 18 and use Tiger Trade to stay connected to the financial markets.
Read the other articles in our #everydayinvestor series.
How This Full-Time University Student Finds Time To Study, Work, Invest & Go To The Gym Regularly
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