"Can I invest in the stock market or securities as a student in uni? Inawezekana, but with patience".
Being a student in university is always stressful. One day you wake up feeling excited about yourself, the next day you feel like dying. This comes about with little inevitable situations that you never ever prayed for in life. They come and go as they please not caring about the situation you're in. January is always a month of hunger, period. This is the time we start to question the choices we made in December. "Who ate what? What did you buy? Who did you buy it for?".
“Do what you love, were you love and with who you love. There is no regret in investing your time with the things you love most.”
It happened. There isn't going back in time, ama? What you can affect the most is how you decade ends and a great opportunity is by investing in stocks or government securities.
What are stocks and securities?
A stock represents a single percentage/part of a company's share of ownership, also referred to as a share. This single percentage has a value attached to it, referred to as the stock/share price. You can buy any number of stocks in a company depending on the stock price placed on it. When the value of a company increases, the stock price also increases and vice versa.
Securities are loans taken by the government for a period of time i.e 5 years or 10 years. These loans have an assured return on them (low-risk) as they are paid back by the same organisation that taxes you. However, they take a longer time to give you back your return compared to stocks.
How does it work?
“It's all basic business. You buy, it multiplies, you either sell or re-invest ”
Because business is all about making profits, this venture requires due-diligence. Make reasonable decisions based on what you know and understand. Research on information to increase the base of your knowledge and advise you on what to buy and what to sell.
Choose your authorized dealer to help you get started with setting up a Cash Deposit and Settlement account (CDS account). This is similar to your savings account. It is where all your money, either deposited or earned, in stocks is kept. You will first need to hold an active bank account by a commercial bank and then fill in some documents to open the account.
It can be a commercial bank, a brokerage firm or directly through the Central Bank of Kenya. It is free to open an account with CBK whereas the rest might charge you a fee.
Once you have opened a CDS account, you are good to go. It's like you have opened your Betika or 1XBet account and you're ready to start risking your fare or food for the week (not school fees...no). ~ this is for the boychild btw...hehe
Tips and Tricks
Patience is the name of the game. Waiting for a month will not give you the return you want, as far as I know. You need to prepare for at least 4-6 months after you have placed your bet. See significant returns on your cash. See how the market works and know which companies to invest in. Figure out how laws and regulations affect company performances. Learn how the existing environment affects the economic trend.
And lastly, a tip from my side. As a student, you have close to minimal or no source of stable income. If you might have any form of savings, start with 20% of that. If you don't have one, start having one soon. This can give you a good start to investing in the stock market in Kenya. Hope to see you back in the next article.
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