5 Key Things You Need to Start Investing in Papua New Guinea Stock Market

Today, many people in Papua New Guinea are coming to realize the importance of saving for future. More and more people are realizing that cost of living is very high because of inflation and one smart way to cushion their money from harsh impacts of inflation is to invest in revenue generating assets such as shares.  Note that there are other asset classes available that you can invest in and I will cover different asset classes in later posts. 

I learnt some years ago that to succeed as an investor, there are a number of key steps you need to take, in the right sequence, at the very outset.  If you avoid them in an attempt to save time and money, it will actually cost you more time and money as you meander aimlessly, acquiring knowledge you don’t need, becoming overloaded and confused and doing nothing as a result.  Not a smart thing to do!

I’ve written an eBook titled 9 Steps to Investing in Shares that outlines the necessary steps you can follow to invest in Port Moresby Stock Exchange or even abroad if you want to take greater risks for greater rewards. All you have to do is read it and follow it step by step. When you’re done, if you need more help, you know where I am.   

 

So! Let’s imagine a life without investing first

You work 9 am-5 pm everyday for a boss all your life. Maybe get a couple of raises, a promotion, have a nice house, car, and kids. You go on vacation once a year, eat out regularly, and attempt to enjoy the finer things in life as best you can. 

Here is the scary part. Since you haven’t invested, you get old, become unattractive for hiring and that is the time life becomes hard.

Many Papua New Guineans who come to towns and cities in search for education and job don’t often return home to their villages after retirement. If you are reading this post, chances are that your parents raised you in a city or you came to city in search for education and a better life.

Living in city after retirement is very expensive. For that, you need to invest your money while you are working now so that by the time you retire, you would have enough assets to continue to generate you cash flow for you to lead a comfortable life after retirement.

Caution!!!! Caution!!!! Caution!!!! 

 However, I must warn you that investing is not for everyone. That is not to discourage you but to caution you to take necessary steps to get properly educated and do what is right. As such, here I provide you a list of key things you will need to start investing in our local stock exchange called Port Moresby Stock Exchange. 

Things you need to get started in Papua New Guinea stock market

Tool # 1. Good understanding on how stock market works

This is very important. Without knowledge about stock market, you put your money at risk. Keep reading this blog to familiarize yourself with the industry terminologies. When you know what you are doing, this knowledge can help you minimize some risks. Stock market guru Warren Buffet said;

“Risk is doing something you don’t know”

You can also visit Port Moresby Stock Exchange website for Stock Market Glossary. Other two important sites to visit are BSP Capital, Kina Securities and Central Bank of PNG.

Tool # 2: You need capital 
You need some starting capital to begin with. Both local stockbrokers, BSP Capital and Kina Securities ask for a minimal amount of K2000 for local trading account. If you working, choose to put away a percentage of you salary for investment and keep investing systematically. Say, you may want to invest K500 after every 4 months. If you want to be aggressive like me, you can invest weekly. Make it fun, raising capital and investing.

 

Tool # 3.Stockbroker

As mentioned, two stockbrokers in PNG are Kina Securities and BSP Capital. You need to do your own due diligence and choose the one that matches your investment goals as well one that offers you competitive tax rates and other related costs of investment. 

Tool # 4. Good financial adviser

For tax, accounting, legal matters and stock market research, planning and execution, you may want to use the service of a good financial advisor. Not all financial are really what they say they are so do your due diligence. Important thing is that your financial adviser must have experience in investing himself or herself. 

Tool # 5. Discipline

Investing is not for everyone and those that aspire to be investors need loads of commitment and tough discipline to make it through. Once you commit your funds to investment, NEVER EVER TAKE IT OUT. This is the reason why it is advisable to maintain an emergency account at all times so in times of dire need, you are not forced into sticking your sticky fingers into your investment account.

Closing remarks

You have been given 5 key tools to start your journey into investing in Papua New Guinea Stock Market. Reading and learning is one thing and doing is another. The former leads to being academically smart and the latter leads to being financial smart. Only those that do it, learn their mistakes and do it better and in that way they become financially smart, wealthy and happy. 

Reminder!!!

Resources available to get you started investing in PNG Stock Market

1. eBook: 9 Steps to Investing in Stock Market
2. First Time Share Invest Investment Kit 
3. Comprehensive One on One Share Market Session