If you want to invest in the stock market, this you must take into account

Are you thinking of investing in Stock Exchange? To enter the world of investments it is not necessary to be a senior executive or to disburse large sums of money, but you must take into account the recommendations that this note brings.

MORE INFORMATION: Dividends of the main 20 companies in the Lima stock market doubled this year

Investing in the stock market is deciding to put money in a company in exchange for a number of shares, which makes you a part owner of that company. You can then sell those shares at a higher or lower price, thus making a profit or loss. At the same time, as long as you hold these shares, you can also receive quarterly, semi-annual or annual profits, along with the other shareholders.

Any entrepreneur with a little capital can become an investor in the Lima Stock Exchange or abroad; and buying or selling shares of companies of different types and sizes.

“The people who have accumulated large sums of money are the ones who have invested wisely in buying shares of companies that have been very successful. Because if you know how to invest in it, you can have exceptional profitability “, explains Melvin Escudero, a professor at Pacífico Business School.

But how can I have a return if I don’t know how to invest or know a lot about finances? The specialist gives you some steps to follow.

WHAT SHOULD I DO AND TAKE INTO ACCOUNT TO INVEST IN THE STOCK EXCHANGE?

Here are some recommendations to enter the world of investing in stocks:

Save to be able to invest: never use money that you have planned for other expenses, try to invest extra money that you can have.
Define an amount to invest: Although there is no minimum amount, the BVL indicates that the minimum should be S / 5,000.
Understand that the investment is long-term: a minimum horizon is 3 to 5 years, but the ideal is 10 to 20 years.
Understand that every investment is a risk: the value of shares can go down or up.
Learn to invest in stocks: you have to inform yourself. There are many websites from different countries that teach you about how the stock market works.
Find an investment advisor: Stock Brokers (SAB), entities regulated and authorized to make investments, will assign you a stock or brokerage representative (brokers), who will guide and guide you to make the best decision. They will create a RUT (Unique Tax Registry) where all your operations will be registered. Every SAB charges a commission for every purchase or sale transaction.
Communicate your transactions: You must carry out the purchase and sale orders through the communication channels that you have designated with your stock exchange representative.
Diversify your investment: There are many companies in the stock market. It’s a good idea to diversify to lower your risk. The Lima Stock Exchange (BVL) has a wide variety of investment instruments such as stocks, bonds, commercial papers, etc.

CAN I INVEST IN FOREIGN COMPANIES THROUGH THE LIMA STOCK EXCHANGE?

If you can invest in foreign companies through the Lima Stock Exchange (BVL). There is a list of Foreign Securities that can be traded from Peru. To do this, you must bear in mind that for each Foreign Security there is a promoter agent, that is, a SAB in charge of carrying out the operations of said security. CLICK HERE to find the list of Foreign Securities in terms of Shares, ETF’s and Bonds.

People working in the US stock market (Photo: AP)

HOW TO INVEST IN THE STOCK EXCHANGE ACCORDING TO AGE?

According to Melvin Escudero, professor at Pacífico Business School, this is how you should invest according to age ranges:

Young people under 40 years of age: they can invest 80% of their savings in stocks to make it grow. Being young you can save and capitalize.
Adults between 40 and 65 years: it is recommended that you invest 50%.
Over 65 years: maximum of 20 to 30% of your savings.

Age is important when investing in stocks (Reference photo: AP)

IS THERE AN EASIER WAY TO INVEST IN THE STOCK MARKET?

If you don’t know much about investing in stocks, investing in mutual funds is recommended. Melvin Escudero, a professor at Pacífico Business School, explains that people can find companies that can manage their money through ETFs.

“They are in charge of managing and diversifying your money in several in various companies around the world. There are active and passive mutual funds ETFs in Peru, where are the 15 best companies in the country to invest”, He details.

He mentions that in this case the commissions are lower and the minimum investment required is 10 dollars, but he emphasizes that it is advisable to invest at least US $ 100.

Investing in mutual funds is a profitable alternative (Photo: Andina).

WHAT ARE THE DIFFERENCES BETWEEN AN ETF AND A SHARE?

Both are negotiable securities, however, when you buy an ETF you are investing in a basket of assets (stocks, bonds, currencies, etc.) corresponding to its reference index; Instead, a stock represents a fraction of a specific company. In other words, an ETF provides a diversified investment and a stock a single-asset-focused investment.

Agent on the Wall Street Stock Exchange (Photo: AFP)

IN HOW LONG WILL I BE ABLE TO SEE THE PROFITABILITY OF MY INVESTMENT?

The time to see the return on the investment depends on the type of investment you make in the stock market. Remember that investments must be made with a view to the medium or long term. It is important, according to the Lima Stock Exchange, that you are aware that any investment you make in the stock market is similar to the sowing season, since you must spend a prudent time to be able to harvest and, even more, know when it will be the exact moment. It is important to know how to wait.

You have to be patient to wait for the returns on investing in the stock market. It is long term. (Photo: GEC)

WHAT SHOULD I TAKE INTO ACCOUNT TO CHOOSE A STOCK MARKET COMPANY AND BE ABLE TO INVEST?

To choose a Society of Stock Brokers (SAB) you must carry out your own research on each one of them and evaluate which one is the one that suits your needs. Some factors that you can take into account when choosing a SAB are:

Percentage of commissions.
Registration facilities.
Support from a financial advisor.
Communications with the SAB.

WHERE CAN I FIND COURSES TO INVEST IN THE LIMA STOCK EXCHANGE?

In the BURSEN business school, the Center for Financial Studies of the Lima Stock Exchange (BVL), has courses, seminars and free and paid programs that will help you learn more about the local and international stock market or also promote your financial knowledge to obtain international certifications. We recommend the following links: