How to Trade Stocks in the Stock Market of Philippines as Beginner in 2024
Are you looking to trade stocks in the stock market of Philippines, but don’t know where to start? This beginner’s guide will show you how to trade stocks in the stock market in Philippines, so you can start making money right away.
Introduction of Stock Trading in Philippine Stock Market
So, you want to trade stocks in the stock market. Maybe you’ve seen people do it on TV or read about it in the news, and you’re curious how they make money. Or maybe you’ve been following the stock market and you think you could make some money by trading stocks yourself.
Whatever your reasons, if you’re interested in learning how to trade stocks in the stock market, this beginner’s guide is for you. We’ll cover everything you need to know to get started, including what stocks are, how they work, how to trade them, and what to watch out for. Let’s get started.
What are stocks and how do they work?
A stock is a piece of ownership in a company. When you buy a stock, you’re buying a small piece of the company. For example, let’s say you buy a share of BDO stock or Jollibee Food Corporation stock. This means you now own a tiny piece of BDO or Jollibee.
The value of a company’s stock is based on how much money the company makes. If a company is doing well and making a lot of money, its stock will be worth more. If a company is doing poorly and losing money, its stock will be worth less.
When a company makes money, its stock price usually goes up. When a company loses money, its stock price usually goes down. So, when you buy a stock, you’re betting that the company will do well in the future and make more money.
How to trade stocks in the Philippine Stock Market
Now that you know what stocks are and how they work, let’s talk about how to trade them.
When you trade stocks, you’re buying and selling shares of companies. You can do this through a stockbroker. A stockbroker is a person or company that buys and sells stocks on your behalf. Which means that, they are a middle man.
Stockbrokers charge a commission for their services. This is usually a small percentage of the value of the stocks you’re buying or selling. For example, if you buy ₱1,000 worth of stock, your stockbroker might charge you a ₱10 commission, depending on the percentage.
There are two main ways to buy and sell stocks: online and through a stockbroker.
Online: You can buy and sell stocks online through a broker such as COL Financial. Stockbrokers: You can also buy and sell stocks through a traditional stockbroker. Stockbrokers can be found at most major banks. BPI and BDO have its own stockbroker.
When you buy a stock, you’re buying it from someone who already owns it. When you sell a stock, you’re selling it to someone who doesn’t own it yet.
The price of a stock is always changing. It goes up and down based on supply and demand. The price also changes based on the news. For example, if a company like Jollibee announces good news, like a new product, its stock price might go up. If a company like San Miguel Corporation announces bad news, like layoffs, its stock price might go down.
You make money by buying stocks when they’re low and selling them when they’re high. For example, let’s say you buy a stock for ₱100. The next day, the stock goes up to ₱105. You just made ₱5!
Of course, it’s not always this simple. The stock market is very volatile, which means prices can go up and down a lot. It’s important to be careful when you’re buying and selling stocks. You don’t want to buy a stock and then see the price go down.
How to find the best stocks to trade in the Philippine Stock Market
There are a few things you should look for when you’re trying to find the best stocks to trade.
First, you want to find stocks that are volatile. This means they go up and down a lot in price. These stocks are more likely to make big moves, which means you could make more money.
Second, you want to find stocks that are liquid. This means there are a lot of people trading them. This makes it easier to buy and sell the stock.
Third, you want to find stocks that have high volume. This means there are a lot of shares being traded. This makes it easier to buy and sell the stock.
The above guide is very risky, if you those steps, be sure you’re always have the right information about your chosen stocks. You must be willing to receive loses, since loses of capital is expected.
When to buy and sell stocks
You should buy a stock when the price is low and sell it when the price is high. Of course, it’s not always this simple. The price of a stock can go up and down a lot.
It’s important to pay attention to the news when you’re trading stocks. Good news usually causes the stock price to go up. Bad news usually causes the stock price to go down.
You should also pay attention to the technical indicators. Technical indicators are a way to measure the stock price. They can help you predict when the stock price will go up or down.
Risk management
When you’re trading stocks, it’s important to manage your risk. Risk is the chance that you will lose money.
There are a few ways to manage your risk when you’re trading stocks.
First, you can use stop-loss orders. A stop-loss order is an order to sell a stock when it reaches a certain price. For example, let’s say you buy a stock for ₱100 per share. You can place a stop-loss order at ₱90 per share. This means the stock will be sold if it goes down to ₱90.
Second, you can use limit orders. A limit order is an order to buy or sell a stock when it reaches a certain price. For example, let’s say you want to buy a stock for ₱100. You can place a limit order at ₱90. This means the stock will be bought if it goes down to ₱90.
Third, you can use stop-limit orders. A stop-limit order is an order to buy or sell a stock when it reaches a certain price. For example, let’s say you want to buy a stock for ₱100. You can place a stop-limit order at ₱90. This means the stock will be bought if it goes down to ₱90 and sold if it goes up to ₱100.
My Final Thoughts
In the information above, you have some idea on how to trade stocks in the stock market of Philippines, with the inclusion about risk management. But, for me, I don’t recommend this trading stocks, since there’s a high chance that your capital will be gone, especially if your beginner on this game.
Investing on stocks is better option if you want to make money in the stock market, since the risk of losing your capital is reduce over time.
Invest now, because the longer you invest your money, the more wealth you can create.
