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In the world of investment opportunities, forex trading has established itself as a lucrative avenue for investors globally. In Malaysia, a growing number of individuals are looking towards forex trading as a means to earn profit. This article aims to provide a comprehensive guide to Malaysians who are considering venturing into forex trading . Let's delve into the aspects that you need to know about forex trading in Malaysia. Table Of Contents What Is Forex Trading and How Does It Work? Currency Trading In Forex How Are Forex Trades Quoted? (How To Read/Understand A Forex Trade) Commonly Used Forex Terms The 3 Ways To Trade Forex Forex Trading Strategies - Hedging and Speculating How To Start Forex Trading As A Malaysian Investor Where To Trade Forex in Malaysia? Pros and Cons of Forex Trading Advice for Protection Against Scams My Thoughts on Forex Trading As A Malaysian Investor What Is Forex Trading and How Does It Work? Forex trading (FX), also known as foreign exchange trading , involves the buying and selling of currencies in the foreign exchange market with the aim of making a profit. For instance, if you believe that the MYR (Malaysian Ringgit) will appreciate against the USD (US Dollar), you might buy MYR and sell it later at a higher price to make a profit. The forex market is the largest financial market globally, with daily transactions amounting to over $6 trillion. The market is open 24 hours a day, five and a half days a wee k with currencies traded worldwide in the major financial centres of Frankfurt, Hong Kong, London, New York, Paris, Singapore, Sydney, Tokyo, and Zurich—across almost every time zone. Currency Trading In Forex In forex, currencies are traded in pairs (forex quote). The value of one currency is always determined in comparison with another currency. There are seven major currency pairs that account for about 75% of trading in the forex market: EUR/USD USD/JPY GBP/USD AUD/USD USD/CAD USD/CHF NZD/USD How Are Forex Trades Quoted? (How To Read/Understand A Forex Trade) 1. Currency Pairs As mentioned above, a forex quote is represented with two currencies. For instance, USD/MYR, where: The currency on the left , (the USD) is the base currency. Meanwhile, the currency on the right (the Malaysian Ringgit) is the quote currency. 2. Bid and Ask Price When you look at a forex quote, you'll generally see two prices: a) Bid Price: The price at which you can sell the base currency . It is the highest price that a buyer is willing to pay for a currency pair. b) Ask Price (sometimes called the Offer Price): The price at which you can buy the base currency . It is the lowest price that a seller is willing to accept for a currency pair. For instance, if USD/MYR is quoted with a bid price of 4.1500 and an ask price of 4.1505, it will look something like this: USD/MYR: 4.1500 (Bid) / 4.1505 (Ask) 3. Spread The difference between the bid and the ask price is known as the "spread". Using the example above: Spread = 4.1505 (Ask) - 4.1500 (Bid) = 0.0005 The spread is essentially the broker's commission for executing the trade (though it can also reflect market liquidity). 4. Pips A "pip" is the smallest price movement that a currency pair can make based on market convention. Usually, a pip is equivalent to a 0.0001 change in value. For example, a one-pip movement would be a change from 4.1500 to 4.1501. Think of this 4-digit (or 5-digit) as a reflection of the incredibly high volume and liquidity in the forex market, which leads to very small and frequent price movements. This granular pricing helps traders to make more precise decisions and potentially profit from these tiny fluctuations. To wrap it all up, imagine you are at a marketplace. The currency pair USD/MYR is like an item you want to trade. The seller (the market) is asking for 4.1505 MYR (ask price) for each USD. If you agree to buy at that price, you have made a deal. Conversely, if you want to sell USD, the market is willing to buy it from you for 4.1500 MYR each (bid price). The small difference in price (0.0005) is kept by the broker as their fee for facilitating the trade. Commonly Used Forex Terms 1. Lot Forex is traded by what’s known as a lot, or a standardized unit of currency . The typical lot size is 100,000 units of currency, though there are micro (1,000) and mini (10,000) lots available for trading, too. 2. Leverage Because of those large lot sizes, some traders may not be willing to put up so much money to execute a trade. Leverage, another term for borrowing money , allows traders to participate in the forex market without the amount of money otherwise required. 3. Margin Trading with leverage isn’t free, however. Traders must put down some money upfront as a deposit —or what’s known as a margin. 4. Long and Short To "go long " means to buy with the expectation that the value will rise . Meanwhile, to "go short " means to sell with the expectation that the value will decrease . The 3 Ways To Trade Forex Similar to stock trading, forex trading also involves speculation of future currency price movements. Forex traders attempt to buy currencies they believe will appreciate in value compared to other currencies or to get rid of currencies they predict will see a decline in purchasing power. There are three different ways to trade forex: 1. Spot Forex Market In the spot forex market, currencies are bought and sold according to the current price , which is determined by supply and demand dynamics in the market at that particular time. The main characteristic of the spot market is that the physical exchange of the currency pair takes place at the exact point the trade is settled – ‘ on the spot ’, which is generally within a two-day period . 2. Forward Forex Market In the forward forex market, instead of executing a trade now, contracts are bought and sold between two parties who agree to trade a set amount of a currency pair at a specified price at a designated date in the future (or within a range of future dates). The contracts in the forward forex market are binding (private) and are usually closed out before the designated date, with the parties settling for the price difference. 3. Futures Forex Market Similar to the forward market, the futures forex market deals with contracts to buy or sell a certain amount of a currency pair at a specified price at a designated date in the future. However, unlike the forward market, the futures market deals with standardized contracts that are traded on (market) exchanges rather than privately. Forex Trading Strategies - Hedging and Speculating In forex trading, both speculating and hedging are common strategies employed by traders and investors to make profits or protect their investments from adverse market movements. This is especially prominent in the forward and futures markets where traders speculate or hedge against future price changes in a currency. Let's delve deeper into these two strategies: 1. Speculating a) Definition: Speculating involves buying or selling currency pairs with the expectation that they will move in a favourable direction, allowing you to make a profit. It is like making an educated guess where you predict the direction of currency values and trade based on your predictions to make a profit. b) Example: Imagine you are betting on a football match. You've done your research and believe that Team A is going to win. You place a bet on Team A. In forex trading, it's quite similar. Let's say you believe that the Malaysian Ringgit (MYR) will strengthen against the US Dollar (USD) in the near future based on current economic indicators. You buy a lot of MYR/USD, hoping to sell it at a higher price later when (and if) the MYR strengthens, thus making a profit. c) Characteristics: Short-Term to Medium-Term Trades Speculative trades often happen over short to medium-term periods , ranging from a few minutes to several days or weeks. High Risk Given the nature of speculation, it is often considered a higher-risk strategy as it depends on price movements which can be unpredictable. Leverage Speculators often use leverage to amplify their potential profits , though it also increases the potential losses . Technical & Fundamental Analysis Speculators rely heavily on technical and fundamental analysis to make informed decisions on the potential direction of currency pairs. Profit Motive The primary objective of speculation is to make a profit from the price fluctuations in the forex market. 2. Hedging a) Definition: Hedging involves taking positions in the market to offset potential losses that may be incurred, effectively protecting your investment from adverse market movements. It’s like taking out an insurance policy for your trades. You make trades to offset potential losses to your investment from adverse market movements, kind of a safety net. b) Example: Let's stick to the football match scenario. To safeguard your bet on Team A, you also place a smaller bet on a draw, so if Team A doesn't win, your loss is minimized because you win the draw bet. In the context of forex, suppose you have a significant investment in the US market, and a fall in the USD value could result in a loss. To hedge this, you might also take a position that profits if the USD falls (like buying EUR/USD). This way, if the USD does fall, the loss in your investment is offset by the profits from your EUR/USD trade. c) Characteristics: Risk Management Hedging is primarily used as a risk management strategy to protect investments from unwanted market movements. Cost Involvement Hedging can involve costs, as it might require taking multiple positions which might not always result in profits . Complex Strategies Hedging strategies can be complex, involving multiple financial instruments such as futures, options, and spot forex trades. Long-Term Perspective Hedging is often employed with a longer-term perspective , looking to protect investments over extended periods. 3. Putting Them Together - Hedging and Speculating To tie these concepts together, imagine you are a business owner in Malaysia who has to pay a US supplier in USD after a month. Given the volatile nature of the forex market, the MYR/USD exchange rate can fluctuate significantly in a month. Speculating: If you believe that MYR will strengthen against USD in this period, you might wait to convert your MYR to USD, expecting to get a better rate later. Hedging: To protect yourself from potential losses if the MYR weakens instead, you might use a hedging instrument (like a forward contract) that allows you to lock in the current exchange rate for a future date. This way, even if MYR weakens, you won't have to pay more than what you had locked in. How To Start Forex Trading As A Malaysian Investor Step 1: Educate Yourself Understand the Basics : Learn the fundamental concepts of forex trading including currency pairs, pips, leverage, and margin. Get to Know the Market Analysis Techniques : Equip yourself with knowledge of market analysis techniques such as technical analysis and fundamental analysis. Keep Abreast of Economic News : Stay updated with global economic news as it has a significant influence on forex markets. Step 2: Choose a Reliable Forex Broker Regulated Broker : Ensure to choose a broker that is regulated by a reputable authority. In Malaysia, the main regulatory body is the Securities Commission Malaysia (SC). Transaction Costs : Compare transaction costs, spreads, and potential commissions charged by different brokers. Step 3: Develop a Trading Plan Trading Strategy : Develop a trading strategy based on your risk tolerance, capital, and trading style. Risk Management : Incorporate risk management strategies to protect your capital. Step 4: Open a Trading Account Documentation : To open a live trading account, you'll need to provide necessary documents such as proof of identity and proof of address. Minimum Deposit : Be aware of the minimum deposit requirements of the broker. Step 5: Start Trading Analysis : Conduct market analysis before you enter a trade. Placing Trades : Learn how to place trades, including market orders and pending orders. Monitoring Trades: Monitor your trades regularly and make adjustments as needed based on market conditions. Continuous Learning : Forex trading is a continuous learning process. Learn from your trades and improve your strategies over time. Where To Trade Forex in Malaysia? I know there are a lot of brokerages out there but to be honest, I don’t really trust them. So, I’m going to recommend some banks and trusted financial institutions that have been approved by Bank Negara Malaysia . 1. Appointed Overseas Office (AOO) The AOO serves to facilitate wider price availability and enhance the liquidity of ringgit FX transactions outside Malaysian trading hours. Here are some of the banking groups involved: Al-Rajhi Banking & Investment Corporation (Malaysia) Berhad AmBank (M) Berhad Bank of America Malaysia Berhad Bangkok Bank Berhad BNP Paribas Malaysia Berhad And more depending on the country. 2. Counterparties Counterparties comprise all the licensed onshore banks in Malaysia, both local and foreign banks, custodian banks both local custodians and global custodians as well as international central securities depositories. Here are some of the banks for both. a) Licensed Onshore Banks Affin Bank BerhadBNP Alliance Bank Malaysia Berhad AmBank (M) Berhad Paribas Malaysia Berhad Bangkok Bank Berhad And more . b) Custodian Banks Affin Hwang Investment Bank Berhad Alliance Bank Malaysia Berhad Alliance Investment Bank Berhad Bank of Singapore Bank of America And more . 3. Primary Market Makers Bank of America BNP Paribas CIMB Bank HSBC Bank JP Morgan Chase Maybank Standard Chartered Bank Deutsche Bank Pros and Cons of Forex Trading Now, you might be asking yourself, should you consider going into forex trading? I mean, these days, there are a lot of scams going around after all. So here are the pros and cons of forex trading so that you can weigh it out and determine if it's the right choice for you. Pros of Forex Trading 1. Liquidity and Market Hours The forex market is incredibly liquid and operates 24 hours a day during weekdays, allowing for flexible trading hours. Example: A Malaysian investor can trade with international markets at any time, potentially profiting from economic events happening in different time zones. 2. Leverage Forex trading offers leverage, which means you can control a large position with a relatively small amount of capital. Example: A trader with a small initial deposit can potentially make significant profits by utilizing leverage wisely. 3. Diversification Forex trading can be a good option for portfolio diversification. It can potentially yield profits irrespective of the trends in other markets. Example: During economic downturns, a Malaysian investor can potentially hedge risks or make profits by trading forex as it may not be directly correlated with the stock market. Cons of Forex Trading 1. High Risk and Leverage While leverage can amplify profits, it can also exponentially increase losses. Example: A newbie investor from Malaysia might use excessive leverage, only to find that a small adverse movement in currency pairs wipes out their entire capital. 2. Complexity and Need for Knowledge Forex trading is complex and requires a deep understanding of market analysis, which can be overwhelming for beginners. Example: A Malaysian investor who jumps into trading without adequate knowledge might make uninformed decisions, leading to substantial losses. 3. Vulnerability to Scams Unfortunately, the forex market has been a breeding ground for scams and fraudulent activities. Pump and Dump Schemes : Perpetrators inflate the price of a currency pair artificially and then sell their positions at a high, leaving innocent investors with worthless assets. Phoney Forex Trading Investment Funds : In Malaysia, there have been cases where scammers have set up fake investment funds promising guaranteed returns, only to disappear with investors' money. Misleading Marketing and Signal Sellers : Individuals might encounter scams where service providers promise "guaranteed" profitable trading signals for a fee, which turn out to be false. Advice for Protection Against Scams 1. Due Diligence Conduct thorough research to validate the credibility of brokers and investment platforms. 2. Regulatory Compliance Always choose brokers regulated by reputable bodies like the Securities Commission Malaysia (SC) to ensure a secure trading environment. 3. Education Educate yourself to discern genuine opportunities from scams. My Thoughts on Forex Trading As A Malaysian Investor In my opinion, I think it’s very hard to earn a profit through this because the forex market is notoriously volatile and complex, requiring a deep understanding of economic indicators, market trends, and trading strategies to navigate successfully. Moreover, the influx of scams adds an additional layer of risk. There are a lot of scams these days so if you want to do it, make sure you use a credible brokerage that adheres to regulations set by authoritative bodies to safeguard your investments. Like I always say, make sure you equip yourself with enough knowledge through diligent research and education, as well as constantly update yourself on market news and analyses. This is a realm where informed decisions are vital to securing profits. Moreover, exercise caution with your investment capital; definitely don't put all your money into it. Diversification is key after all, not only within the forex market but across different financial instruments. By following these guidelines, I hope you can craft a more resilient and potentially successful investment journey in the volatile world of forex trading as a Malaysian investor. Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Deciding on a type of investment can be quite tricky especially when there’s a myriad of options available in the Malaysian market today. Should you invest in bonds for something safer? Or should you invest in stocks for higher returns? In this article, we will help both novice and seasoned Malaysian investors understand the nuances of these investment choices. Let's dive into the fascinating realm of Malaysian bonds and stocks, unravelling their complexities to pave your path towards informed investing. Understanding Bonds and Stocks in Malaysia Bonds  are essentially  loans given to corporations or governments . When you buy a bond, you're lending money in exchange  for periodic  interest payments  and the return of the bond's face value  when it matures. They're generally considered lower risk with stable returns.  Malaysian government bonds, like Malaysian Government Securities (MGS), are popular examples. Stocks , on the other hand, represent ownership in a company . Buying a company's stock means you own a part of that company . Stocks are riskier  than bonds but offer higher potential returns . Well-known Malaysian stocks include Maybank, Petronas, and AirAsia. Choosing Between Bonds and Stocks As Investments in Malaysia There are some factors that you’ll need to consider when you’re choosing between these two investment vehicles: Risk Appetite Assess how much risk you can handle. Stocks can fluctuate significantly, offering higher potential rewards and risks, whereas bonds generally offer more stability. Investment Duration Your investment time horizon is crucial. Stocks typically perform better over the long term, while bonds are often more suitable for short- to medium-term investments. Income vs. Growth Are you looking for regular income or long-term capital growth? Bonds are income-oriented, while stocks are more about growth. Market Analysis Keep an eye on market trends and economic indicators. Certain market conditions favour stocks, while others favour bonds. How To Invest in Malaysian Bonds and Stocks with 5 Steps 1. Selecting a Broker Research and Compare Start by researching various brokers. Look for reviews, user experiences, and compare their services. Your choice should align with your investment needs. Platform Reliability and Tools A good broker should offer a reliable trading platform with analytical tools, real-time data, and educational resources. Regulatory Compliance Ensure the broker is regulated by Malaysian authorities like the Securities Commission Malaysia. This adds a layer of security to your investments. Customer Support Good customer service is crucial, especially for beginners. Check if the broker offers accessible and knowledgeable support. Brokers to Consider Maybank Investment Bank, CIMB Investment Bank, and Rakuten Trade are reputable options. Each has its unique features and services, so choose the one that best suits your investment style. 2. Setting Up Accounts Stock Trading Account To trade stocks, you need a Central Depository System (CDS) account. This account holds your stocks and ensures smooth transactions. It can be set up through your chosen broker. Brokerage Account for Bonds For bonds, a standard brokerage account is usually sufficient. Some bonds can be bought directly, while others might require an intermediary. Documentation and Verification Be prepared with necessary documents like your identification and financial records. Verification processes are crucial for security and compliance. 3. Understanding Fees Brokerage Fees Different brokers charge different fees. Compare these costs as they will impact your investment returns. Other Charges Be aware of potential hidden fees like annual account maintenance fees, inactivity fees, or charges for using certain platform features. Bonds vs. Stocks Fees Typically, bond transaction fees are lower than those for stocks. However, the cost can vary based on the bond type and the transaction volume. 4. Doing Your Homework Use Research Tools Leverage the research tools provided by your broker. These can include market analysis, investment news, and performance charts. Educational Resources Many brokers offer tutorials, webinars, and guides. Utilize these to understand market trends, investment strategies, and risk management. Understand Your Investments Study the historical performance, financial health of companies (for stocks), and the creditworthiness of bond issuers. 5. Tips When You’re Starting Off Invest What You Can Afford to Lose As a beginner, it's wise to start small. This minimizes risk as you learn. Diversify Don't put all your eggs in one basket. Diversifying your portfolio across different stocks and bonds can balance risk. Monitor and Learn Regularly monitor your investments and market conditions. Use your initial experience to refine your strategies. So, Should You Invest in Stocks or Bonds in Malaysia? After delving into the intricacies of bonds and stocks in the Malaysian market, the question remains: which investment vehicle should you choose? The answer, quite frankly, depends on your individual financial situation, goals, and risk tolerance. Bonds , with their lower risk profile  and steady income generation , are a solid choice for investors who prioritize security and stability over high returns. They are particularly suitable for those nearing retirement or individuals who prefer a predictable income stream. The Malaysian bond market, with options like Malaysian Government Securities (MGS), offers a reliable avenue for such investors. On the other hand, stocks , despite their higher risk , present an opportunity for substantial growth . If you have a l onger investment horizon  and can stomach market fluctuations, stocks could be your ticket to potentially higher returns. Companies like Maybank, Petronas, and AirAsia have shown that well-chosen stocks can significantly enhance an investor's portfolio. The key, however, lies in understanding your own financial landscape. If you're young , have a stable income, and can afford to take risks , leaning towards stocks might be more beneficial. Conversely, if you seek stability or are nearing retirement , bonds  could be a safer bet. With all that being said, I think the most important aspect of investing is still diversification . A mix of stocks and bonds can balance risk and return  in your portfolio. This approach allows you to enjoy the growth potential of stocks while the bonds provide a safety net against market volatility. In conclusion, whether you choose to invest in bonds or stocks in Malaysia, the decision should align with your personal financial goals, risk tolerance, and the current economic landscape. Remember, there is no one-size-fits-all answer in investing; it's about finding the right balance that works for you. Subscribe to our financial newsletter  for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Taking your first step into global stocks can feel overwhelming. With so many investment options available, it’s not surprising that new investors often feel unsure of where to begin. And with good reason: if not done correctly, investing in global stocks can be very expensive. But don’t worry, we’ve got you covered. In this article, we’ll break down what global stocks are, explain common stock market terms, and share tips on how to start investing in the international market. What are Global Stocks? The global stock market, also known as international stocks, connects investors with companies from around the world. It allows individuals to buy and sell shares (ownership units) in these companies, offering investment opportunities beyond their own country. For example, if you're a huge fan of Apple , the global stock market lets you invest in them even though you're not from the US. Similar to the local stock market, global stock prices can be affected by various factors beyond the company's performance, including currency fluctuations, economic conditions in the foreign country, and global political events. Why You Should Start Investing in Global Stocks Diversification Ever heard the phrase “don’t put all your eggs in one basket”? As an investor, diversifying your portfolio is a simple and healthy investment practice. Spreading your investments across different countries can help reduce risk. When a particular market or sector performs poorly, your overall portfolio might be cushioned by positive performance in other regions. Growth Potential The biggest appeal of venturing into the foreign market is its growth potential. For example, if you compare Malaysia's projected GDP growth of around 3.8%, emerging economies like China (8.1%) and India (7.2%) are expected to experience significantly faster growth, according to the IMF.   These markets are driven by young populations and booming tech & manufacturing sectors. While riskier, a small allocation to these markets through ETFs can diversify your portfolio and unlock higher growth potential. Better Exposure Investing in the global market gives you access to companies that might not be available in your local market. You can invest in innovative or leading companies in specific industries that might not have a local presence. This can help hedge against potential risks in your local economy, such as political instability or currency devaluation. Currency Appreciation If you invest in a company whose stock price rises and the foreign currency strengthens against your own, you could benefit from a double advantage. For example, if a Malaysian investor buys shares in a Singaporean company and the company’s stock price rises while the Singapore dollar (SGD) strengthens against the Malaysian ringgit (MYR), the investor would gain a double advantage. In the right market conditions, investing in global markets is a great way to diversify your investment portfolio and maximize your profits. Considerations When Investing in the Global Market As you know, in every investment transaction, there is a risk you need to be aware of: Market Volatility Investments in the global market exposes you to added volatility influenced by geopolitical events and currency depreciation.  This could lead to potential losses, which is why understanding your financial goals, risk tolerance, and investment horizon is important. Global Transaction Fees The most significant barrier to investing in global stocks is the added transaction cost, which varies depending on the foreign market you want to invest in. For example, IBKR offers the lowest brokerage fees, across 150+ countries, which is cost-effective for investors. There may be additional costs like FX conversion charges, transfer fees, and annual maintenance fees that you should know about on top of the brokerage commissions, so it’s always important to do your homework before you settle on a broker you can trust. Tips for Getting Started in the Global Stock Market 1. Understand Your Investment Goals and Risk Tolerance Keep in mind that investing comes with unpredictable risks. Before investing, take a moment to understand your financial goals and your risk appetite . This can provide you with a clear roadmap for your investment journey and guide your investment decisions. 2. Plan Your Investment Strategy Next, plan your investment strategy based on your personality, discipline, and risk tolerance. This strategy will guide your decisions about when to buy or sell. If you want to test your strategy without losing any money, use a paper trading feature. Paper trading is a simulated experience where you can practice buying and selling investments using fake money. This will help you get comfortable with investing, test your strategy, and learn from mistakes without any real financial loss. 3. Diversification is Key A well-diversified portfolio can help you maximize your expected returns without taking on unnecessary or unwanted risk. Spread your investments across different assets (stocks, bonds, etc.) to minimize risk. As a beginner, start small with foreign stocks. Consider Exchange Traded Funds (ETFs) that focus on emerging markets - they offer instant diversification across many companies in one purchase. Bonus Tip: Dollar-cost averaging helps you buy more shares when prices are low and fewer when they're high. Invest a set amount regularly, regardless of the price, to smooth out market fluctuations. 4. Choose a Cost-effective Broker To buy global stocks in Malaysia, you need to find a stock broker that offers international trading. There are plenty of brokers on the market, but choosing the right investment broker is crucial for beginner investors when starting their investment journey. Factors such as margin fees and conversion rates are important to consider, as they can directly impact your investment costs and returns. Tip: Always choose a broker with transparent and competitive pricing and low currency conversion rates to minimize investment costs and maximize your gains. Interactive Brokers (IBKR) offers you the freedom to trade with low brokerage fees, no hidden charges, and no minimum deposit amount. This means that even if you leave your deposit in your account for more than 6 months, you won’t be charged for inactivity. After completing the necessary account opening procedures, you can fund your account and start trading. 5. Avoid Chasing Trends Next, decide which stocks to trade. Look for stocks that have the potential for big profits. It's essential to research and understand how stocks perform. Tip: Don't chase trends. Avoid chasing "hot stocks" based on hype or speculation. Focus on companies with a solid track record, strong fundamentals, and long-term growth potential. 6. Regularly Monitor and Review Investing isn’t a 'set it and forget it' deal. Keep an eye on your investments to make sure they still align with your goals and risk tolerance. Watch market trends and adjust your investments as needed to stay on track with your financial goals. Back to Basics for Getting You Started Understanding basic stock market terms is essential for anyone looking to start investing. Here’s a list of 15 key terms that every budding investor should know.  General Terms Stock Definition: A stock represents ownership in a company. If you buy shares of Apple Inc., you become a part-owner of the company. Dividend Definition: A dividend is a payment made by a company to its shareholders, usually from its profits Example: If you own 100 shares of a company that pays an annual dividend of $2 per share, you will receive $200 in dividends each year. Market Capitalization Definition: The total value of a company’s outstanding shares of stock. Example: If a company has 1 million shares outstanding and the stock price is $50, the market capitalization is $50 million. Portfolio Definition: A collection of investments owned by an individual or institution. Example: Your portfolio might include stocks, bonds, and mutual funds. Market Trends Bull Market Definition: A period when stock prices are rising or are expected to rise. Example: The stock market experienced a bull market from 2009 to 2020, with many stocks reaching record highs. Bear Market Definition: A period when stock prices are falling or are expected to fall. Example: The stock market entered a bear market in early 2020 due to the COVID-19 pandemic, causing prices to drop significantly. Rally Definition: A period during which the price of stocks or bonds increases continuously. Example: The stock market experienced a rally after the announcement of the new economic stimulus package. Correction Definition: A decline of 10% or more in the price of a security or market index from its most recent peak. Example: If a stock falls from $100 to $90, it is undergoing a correction. Investment Strategies Day Trading Definition: Buying and selling stocks within the same trading day to take advantage of short-term market movements. Example: A day trader might buy shares of a tech company in the morning and sell them in the afternoon if the price goes up. Short Selling Definition: When an investor borrows shares and sells them, hoping to buy them back at a lower price. Example: If you short sell 100 shares of a stock at $10 each and the price drops to $8, you can buy them back at the lower price and make a profit. Hedge Definition: An investment made to reduce the risk of adverse price movements in an asset. Example: Buying gold can be a hedge against inflation since gold often retains its value when currency value drops. Arbitrage Definition: Buying and selling an asset in different markets to take advantage of differing prices for the same asset. Example: If a stock is trading at $100 on the New York Stock Exchange and $102 on the London Stock Exchange, an arbitrageur would buy the stock in New York and sell it in London. Investment Instruments ETF (Exchange-Traded Fund) Definition: A type of investment fund that is traded on stock exchanges, much like stocks. Example: SPDR S&P 500 ETF (SPY) is an ETF that tracks the performance of the S&P 500 index. Bond Definition: A fixed income instrument representing a loan made by an investor to a borrower. Example: When you buy a U.S. Treasury bond, you are lending money to the U.S. government. Mutual Fund Definition: A mutual fund pools money from many investors to purchase a diversified portfolio of stocks, bonds, or other securities. Example: Vanguard 500 Index Fund is a popular mutual fund that tracks the S&P 500 index . Conclusion Investing in global stocks offers a wealth of opportunities for diversifying your portfolio and potentially boosting your returns. With the right approach, you can make the most of the global stock market and achieve your financial goals. Happy investing! Subscribe to our   financial newsletter   for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

It’s a hard pill to swallow. Imagine opening your inbox to find a notice that you’ve been laid off. Unfortunately, in Malaysia, almost 160,000 people lost their jobs due to the Covid-19 pandemic . When you’re laid off, you’re not going to be in the clearest state of mind. Losing your main source of income is not only stressful but also emotionally draining. Although it might be really tough to get started, it’s vital that you plan your finances effectively during this challenging time. In this guide, we’ll walk you through the first five steps to getting your finances in order after being laid off. 1. Process Your Emotions I know this doesn't seem directly related to finance, but hear me out. When dealing with job loss, your emotional state will undoubtedly be affected. Even though it’s not directly linked to your finances, how you feel can heavily influence your spending habits. You might be tempted to go on a shopping spree to numb the sting of losing your job. But before you do, I urge you to take a step back and process your emotions first. Layoffs usually happen when companies need to cut costs due to various reasons beyond our control. In other words, it’s not your fault, you’re not incapable, and it’s definitely not a reflection of your work performance. So, take a week or two to properly grieve your job loss—preferably without the retail therapy. 2. Review Your Finances The next step requires you to take a good, hard look at your finances. Try to get an estimate of how long you can sustain yourself without an income and figure out ways to cut corners to reduce your monthly expenses. You’ll want to prioritize your spending to cover essentials like housing, food, and healthcare, and consider postponing or eliminating non-essential expenses like entertainment subscriptions. Depending on your industry and your tenure, it’s important to make sure you receive everything that's rightfully yours. Find out what is included in your severance package. Remember to submit your claims for any work-related expenses, like money for travel or parking fees. 3. Get Some Alternatives Income Streams In the midst of your job search, it’s a good idea to come up with alternative income streams to help you along the way. Consider taking up some part-time work, or leveraging your professional skills through freelancing on platforms like Upwork or Fiverr .  Go through your old stuff and sell items you no longer need. You’ll be surprised at what people are willing to buy. You can market your preloved clothes, shoes, and collectibles at thrift stores or through websites like Mudah.my or Carousell , which make selling second-hand goods convenient and accessible. Additionally, you could even turn your passions into profit. For instance, you could sell handmade goods online, offer cooking classes, or sell your photos on stock photography sites. 4. Build Your Budget During your period of unemployment, you’ll have to stretch every ringgit you’ve got, so be sure to buckle down on your monthly expenditure and cut back wherever possible. Use a budgeting app  to help you keep track of your spending.  It’s important to practice restraint when purchasing non-essentials, as unnecessary expenses can really break your budget. If you have emergency funds set aside, this is probably the time to dip into it. Generally it’s recommended to have at least three to six months worth of living expenses set aside for a rainy day.  5. Reduce Your Debt Moving on to debt, try to pay off any outstanding loans or credit card balances to avoid accruing high interest rates. Try to pay what you can afford towards your credit card, as credit card interest can add up due to compounding interest. Focus on keeping your balance low. Keep in mind that extra charges are added when you miss payments, but you can minimize this by paying at least the minimum amount every month. If there are any outstanding loans that you need help with, contact your bank early to inform them about your financial difficulties. Explain your situation to them so they can work with you on a viable solution. Banking institution typically consider requests and restructure loans to accommodate borrowers within reason. Remember to back up your requests by providing your bank with supporting documents as proof of your financial situation.  [Read more on how to pay off your debts here .] Bonus Tip: Try to Apply for Financial Aid Depending on the nature of your job loss , check if you are eligible for unemployment benefits ( EIS ). EIS  is a programme that was set up to offer financial aid to employees who lost their source of income, to help ease the process of job search by providing financial assistance until a new job is found.  If you’re eligible, you must submit your application within 60 days of your unemployment. If you haven’t already, register at the EIS Portal  or a SOCSO office near you (prepare the required documents, such as your NRIC, termination letter, payslips, and bank account information). Alternatively, you can contact customer service at  1300-22-800 for further assistance. They can guide you on the eligibility criteria and which benefits you qualify for. The sooner you reach out, the sooner you can get the support you need.  Conclusion Facing a layoff is undoubtedly one of the most challenging experiences in one's professional life. However, you can mitigate the impact by taking control of your finances to maintain stability during this transition. Remember that getting laid off is not a reflection of your worth or capabilities; it’s simply a temporary setback. Use this time to reassess your career goals, reskill or upskill yourself, and explore new opportunities. Financial preparedness is more than just surviving; it's about setting yourself up to thrive in the long run. By staying calm, you can turn this challenging situation into a stepping stone for better opportunities. Keep pushing forward, and you will find your way to a new and rewarding chapter in your professional journey. All the best! Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Exploring new destinations doesn't have to drain your bank account. With a friendly budget as low as RM3,000, you can still travel on an unforgettable journey to some of the world's most fascinating places.  From the hidden gems in Asia to the quaint towns of Eastern Europe, we've rounded up five travel destinations where you can enjoy a blend of culture, adventure, and relaxation without breaking the bank. Hanoi, Vietnam Estimated Cost Breakdown: Return Flight Tickets: RM800 Accommodation: RM600 for 6 nights Food & Beverage: RM300 Activities & Leisure: RM500 Hanoi, the capital of Vietnam, is a city where ancient history seamlessly blends with modern life. The city's Old Quarter is a maze of narrow streets lined with French colonial architecture, traditional Vietnamese homes, and bustling markets. Street food in Hanoi is both delicious and affordable, offering a taste of authentic Vietnamese cuisine for just a few ringgits. Chiang Mai, Thailand Estimated Cost Breakdown: Return Flight Tickets: RM900 Accommodation: RM700 for 6 nights Food & Beverage: RM400 Activities & Leisure: RM600 Chiang Mai is Thailand's northern capital, known for its serene temples, vibrant night markets, and lush countryside. The cost of living is relatively low, making it a great destination for travellers on a budget. You can explore the historic Old City, take a cooking class, or venture out to the nearby mountains for hiking and visiting ethnic hill tribes. Yogyakarta, Indonesia Estimated Cost Breakdown: Return Flight Tickets: RM1,000 Accommodation: RM500 for 6 nights Food & Beverage: RM300 Activities & Leisure: RM400 Yogyakarta, often called Jogja, is the cultural heart of Java, Indonesia. It's the gateway to the famous temples of Borobudur and Prambanan, UNESCO World Heritage Sites that are a must-visit. The city itself is a vibrant centre of Javanese culture, art, and history, with affordable accommodation and food options that will keep your expenses low. Siem Reap, Cambodia Estimated Cost Breakdown: Return Flight Tickets: RM1,200 Accommodation: RM400 for 6 nights Food & Beverage: RM300 Activities & Leisure: RM400 Siem Reap is the gateway to the ancient world of Angkor Wat, a sprawling temple complex that is one of the largest religious monuments in the world. Beyond the temples, Siem Reap offers vibrant night markets, Cambodian cultural shows, and delicious Khmer cuisine at very affordable prices. Krakow, Poland Estimated Cost Breakdown: Return Flight Tickets: RM1,500 Accommodation: RM800 for 6 nights Food & Beverage: RM400 Activities & Leisure: RM500 Krakow might slightly stretch the budget, but it's well worth it. As one of the oldest cities in Poland, Krakow boasts a beautiful old town, Wawel Castle, and the historic Jewish Quarter, Kazimierz. The cost of living is low compared to Western Europe, allowing you to enjoy delicious Polish meals, museum entries, and leisure activities within a reasonable budget. Budget-Friendly Travel Tips: Stretching Your Ringgit Further To ensure you make the most out of your RM3,000 budget, consider these tips: #1 Book in Advance Early bookings can significantly reduce travel and accommodation costs. #2 Eat Local Enjoy local eateries and street food for authentic and budget-friendly meals. #3 Free Activities Look for free attractions and activities, such as walking tours, public museums, and natural parks. #4 Public Transport Utilize public transportation systems, which are often cheaper and more immersive than taxis or car hires. Travelling on a budget doesn't mean skimping on experiences. With careful planning and a spirit of adventure, these destinations offer rich cultural experiences, breathtaking landscapes, and the chance to make lasting memories without the hefty price tag. Subscribe to our financial newsletter  for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Imagine your car breaking down unexpectedly. To make matter’s worse, it’s the middle of the month and you don’t have enough money for the repairs. What do you do in this situation? Waiting for your next pay cheque won’t help in emergencies like these. But what if your boss could give you the option of an advance salary to help you with your car? That’s what Setgaji can do for you. Setgaji is Focusing on Financial Wellness Setgaji, a financial wellness platform, recently partnered with Cheng & Co Group,  a prominent multi-disciplinary professional services provider. This collaboration aims to improve financial well-being for Malaysian employees by potentially increasing access to financial tools such as: Early Wage Access:  To enable financial flexibility for employees to access a portion of their already-earned wages before their regular payday, potentially helping with unexpected expenses. Financial Management Resources:  Offer resources like budgeting tools or educational materials to help employees improve their financial literacy and manage their finances more effectively. Potential Benefits for Employees By offering these tools, employers partnering with Setgaji could provide several potential benefits for employees: Managing Unexpected Costs:  Early wage access could be a safety net for unforeseen expenses, reducing stress and financial strain. Improved Budgeting:  Having access to budgeting resources could empower employees to plan their finances better, potentially leading to financial stability. Reduced Financial Stress:  Knowing you have options to manage your finances might lead to greater peace of mind and overall well-being. Conclusion The partnership between SetGaji Sdn. Bhd . and Cheng & Co Group is effective immediately and is expected to strengthen both parties' market positions while delivering enhanced benefits to businesses across Malaysia. This collaboration aims to make financial wellness accessible, helping employees manage their finances better and feel more secure in their financial lives. Subscribe to our   financial newsletter  for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Amidst economic uncertainties, Singapore stocks have demonstrated resilience with solid earnings, compelling value propositions, and attractive dividends. Today, we’ll explore the advantages of investing in the Singapore stock market and give you a quick guide to help you get started. Let's dive in! The Benefits of Investing in Singapore Stocks 1. Stable and high-yield dividends  Investing in Singapore stocks offers you the potential for stable returns and high-yield dividends. While the Singapore market may not be as dynamic as the US stock market with large tech giants, like Microsoft and Nasdaq, Singapore's stock market provides investors with consistent returns and a relatively safe investment environment. Many Singapore-listed companies have a culture of paying regular dividends to shareholders. For instance, Netlink NBN Trust, Singapore’s only fibre optic cable provider, has steadily increased its dividend per share from 3.24 Singapore cents in 2018 to 5.3 Singapore cents in 2024 . If you're a risk-averse investor seeking stable and reliable returns, the Singapore stock market is a good option to maintain a portfolio that can withstand market fluctuations. 2. Singapore has a resilient economy  Singapore's economy has consistently demonstrated remarkable stability and growth with a low inflation rate. The city-state has been considered one of the “ Newly Industrialized Countries ’” since 1979. Singapore’s economy was the first to recover from the COVID-19 pandemic, among other countries in the Southeast Asia region. Despite the economic disruptions from the COVID-19 pandemic, Singapore’s economy bounced back quickly, growing by 1.2 percent in 2023  with the growth forecast maintained at 1 percent to 3 percent. Additionally, the Inflation Rate in Singapore decreased to 2.70 percent in March from 3.40 percent  in February 2024. These are considered favourable conditions to investors. With its quick recovery from economic disruptions and low inflation rate, investing in the Singapore market could provide you with  steady returns and helps safeguard your portfolio against market volatility. 3. Diverse and investment-friendly environment  Singapore is known for its highly developed and diversified economy, serving as a global hub for “ IMD World Competitiveness Ranking 2023 ”, Singapore ranks fourth among the most competitive countries in the world. In 2023, the city-state was home to 4,200 regional headquarters of multinational companies.  The stable political system, world-class infrastructure, excellent connection to global trade, and top-rated education system are the foundations of the country's investment climate.  Singapore provides a secure and promising environment for investors, so your investments will be supported by a stable and thriving economy.  4. No capital gains tax in Singapore Another perk of investing in the Singapore stock market is the absence of capital gains tax. This means that both your dividends and capital gains are not taxed, unlike in markets like the US, where a 30% withholding tax on dividends is common. As an investor, this means you’ll get to keep all your earnings. Additionally, Singapore offers several other tax incentives including:  Zero Dividend Tax: Singapore has no withholding tax on dividends. (Though some other types of payments such as royalties, some types of interest, commissions and fees can be subject to withholding tax.) Zero Estate/Inheritance Tax:  No tax is imposed on the transfer of assets from a deceased person to their beneficiaries, ensuring smooth wealth transfer with minimal financial burdens. Tax Transparency for REITs: REITs that distribute at least 90% of their taxable income enjoy tax transparency , and individual investors receive these distributions tax-free. 5. Singapore has a well-established REITs Market Speaking of REITs, Singapore has a vibrant REIT market, which is the second largest in Asia. It offers investors access to income-generating properties like commercial buildings, retail malls, and industrial estates. As of December 2023 , the aggregate market capitalization, or the market value of the outstanding shares of stocks of all REITs, amounted to 68.96 billion U.S. dollars. Investing in Singapore REITs gives exposure to the country’s valuable real estate, which has appreciated steadily over the past five decades. These REITs give stable returns and will let you spread your investments across local and global markets.  What you need to know before investing in Singapore Stocks There are two key components required to start stock investing in Singapore. You will need to set up a brokerage account and a Central Depository (CDP) account . A brokerage account allows you to buy and sell stocks, bonds, ETFs, and other securities. It is held by a financial institution or brokerage firm and acts as a middleman between you and the stock exchanges. You can place trades, monitor your investments, and manage your portfolio through this account. A CDP account is operated by SGX, which holds all your shares on the open market safely.  All investors are required to open a CDP account to store Singapore securities. It serves as a security for all of your stocks. To open a CDP account, you must prepare a copy of your IC, a recent bank statement, and an income statement ready to be submitted.  The difference between a CDP-linked and a nominee account When you open a brokerage account in Singapore, you'll also have to choose between linking it to a CDP account or a nominee account. A nominee account is an account where your brokerage firm holds your shares on your behalf. The shares are registered under the brokerage’s name, and the brokerage acts as a nominee for your investments. You’ll still own the shares and will receive dividends; however, you may not have the same voting rights as with a CDP-linked account. The upside here is that nominee accounts offer you lower fees and provide a wider range of global market options. The type of account you decide to use really depends on your investment style. Remember to do your research, as some brokers might require a minimum deposit before you can execute trades. If you’re looking for a well-established brokerage platform with low fees to minimize costs and maximize your investment returns, then look no further than CGSI. CGSI has been a trusted broker since 1979. The investment platform stands out with its low fees and zero deposit feature. They offer low commission rates and waive fees for CDP Sub-Account maintenance and SGX dividend handling. With CGSI, you can buy, sell, and trade Singapore stocks, invest in ETFs, bonds, options, and futures on their platform. Account opening with CGSI is free, and you won’t require any minimum deposit to start trading. CGSI offers you the flexibility to select more than one margin product. On CGSI, select your account type . Make sure to fill in your personal details correctly, and remember to use your personal email (not your work email!) for registration. After which, you’ll go through the standard  e-KYC verification. Once your application has been approved, you’ll receive an email confirmation with your account details attached. You can then fund your account to begin trading!  For further visual guidance, you can check out the tutorial by CGSI CIMB .  Conclusion Investing in the Singapore stock market from Malaysia could potentially bring you plenty of successful investment opportunities. While the Singapore stock market has shown excellent track records and robust investment opportunities, like all investments, it’s important to remember that they carry risks. As always, we urge you to do your own research or seek professional guidance before making any investment decisions. Subscribe to our   financial newsletter  for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Have you ever wanted to invest in gold but found it too expensive or complicated? Traditionally, gold investments have been out of reach for many everyday investors due to high costs and accessibility issues. But thanks to technological advancements, investing in gold has become easier and more accessible through digital platforms. A digital gold investment allows you to buy and sell gold electronically without the hassle of dealing with physical gold. It's like owning gold, but instead of physically storing the metal, you manage it digitally through apps and online platforms. TNG Digital recently collaborated with CIMB Bank to introduce a new feature within the TNG e-Wallet app, e-Mas, a gold investment feature that provides users with a simplified and accessible way to invest in gold digitally.  Hi! I'm Frankie from the FAQ Show , and here's my thoughts on this new feature: Low Entry Barrier One of the best things about e-Mas is that you can start investing with as little as RM10. Unlike traditional gold investments, which require you to buy at least 1g of gold costing over RM300, this lower entry point makes gold investing accessible to those just starting out. No Transaction Costs e-Mas is a paper gold investment, which means you avoid the additional costs that come with traditional gold investments, like storing and insuring physical gold. This type of investment is perfect if you prefer trading gold without dealing with the logistics of physical bullion. Plus, e-Mas is available to all eKYC-verified users on the platform, providing an accessible entry point into gold investment from as low as RM10 with no hidden costs. High Liquidity Building on that, paper gold offers high liquidity. This means you have the flexibility to convert your assets into cash whenever you need it, which is a huge advantage. Seamless and User-Friendly Experience Everything is handled through the TNG e-Wallet app. You can see the buy and sell quotes transparently on the app, and the minimum sell value is RM10 or the equivalent in grams. Besides buying and selling, you can monitor gold prices with live updates and manage your investments directly via e-Mas . It’s straightforward and easy to use. Note: Please note that at the moment, gold investments done through e-Mas are currently not Shariah compliant due to their digital nature. TNG Digital and CIMB are working together to introduce Shariah-compliant offerings in the future. Currently, users cannot redeem physical gold bars, which are held in custody by CIMB . However, plans to implement this feature are in the works for the second phase, though this is still some time away. If you’re interested in checking it out, you can access e-Mas by launching the TNG e-Wallet app and tapping on the feature’s icon in the Recommended section. Alternatively, you can find it under the “Investment” category via the app’s GOfinance feature . Just make sure to update the eWallet to the latest version to enjoy this feature and other new offerings from TNG. Conclusion Investing in gold doesn’t have to be complicated or costly. With options like e-Mas, you can start small, trade easily, and manage your investment through a familiar platform. It's a convenient and secure way to explore gold investments and potentially enhance your financial portfolio. Subscribe to our   financial newsletter   for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Do company layoffs always mean good news for investors? While it might seem like cutting costs would automatically boost a company's value, the reality is more complex. Today we’ll get into the reasons behind layoffs, how they affect stock prices, and what it means for you as an investor. Mass Layoffs in the Tech Industry In 2023, 263,180 workers at U.S.-based tech companies were laid off, and the trend has continued into 2024. As of now, Layoffs.fyi   has tracked 90,916 employees losing their jobs this year. That’s more than 780 firings each day! Here's a look at the biggest tech layoffs in 2023, along with their stock values shortly after: Amazon  laid off 16,080 roles, which led to their stock value increase by 9% within a month after the layoffs were announced. Amazon’s decision was driven by the need to reduce expenses and increase profitability, focusing on optimising their operational efficiency. The layoffs affected various divisions, including the Alexa voice assistant unit, devices group, and retail operations, where overstaffing and shifting market demands necessitated a reduction in workforce.  Alphabet  laid off 12,000 roles, leading to 15% stock value increase following their announcement of job cuts in the month. The company had conducted a rigorous review and elimination across product areas, functions, levels, and regions to channel their efforts into AI technology. Microsoft laid off 11,158 roles, leading to a 6% increase in stock value within the month of the job cut announcement. The company's CEO mentioned plans to invest in generative artificial intelligence, particularly in OpenAI, the startup behind the chatbot sensation ChatGPT, which Microsoft plans to market through its cloud service. Meta laid off 10,000 roles, leading to stock value increase of 50%.  The layoffs aimed to restructure the company by canceling lower-priority projects and reducing hiring rates, while also 'removing layers of middle management to make decisions faster.' However, the tech giant continued to invest billions in developing the virtual reality and augmented reality technologies required for the metaverse. So, do layoffs actually pay off? At a glance, the idea of slashing a company’s headcount might translate to a surge in stock price, but there’s more to the story. Cutting jobs to increase profitability may not necessarily improve stock prices. In general, stock prices are based on how people perceive the company. If they believe the layoffs would help the company, it could result in more people placing their bids. Conversely,  mass layoffs can also give investors a hint that a company is struggling. If they see the layoffs as a bad sign, they would sell their shares out of fear or a lack of confidence in the company. For example, Wayfair’s stock price quickly fell  after their initial rise after layoffs. The stock gave up almost all of its post-layoff gains after reporting a wider fourth-quarter loss. This highlights how layoffs alone might not convince investors of a turnaround for struggling companies. To build on this, a study  showed that companies with little to no layoffs performed significantly better than those with mass layoffs: Companies with minimal layoffs (3% or less) saw a 9% share price increase (similar to no layoffs). Companies with moderate layoffs (3-10%) experienced flat share price movement. Companies with significant layoffs (over 10%) saw a 38% drop in share prices. Reasons for layoffs 1. Financial strain and economic downturns  When economic conditions deteriorate or a company faces financial hardship, reducing labor costs through layoffs becomes a strategy to improve profitability and weather the storm. 2. Restructuring and streamlining  Companies may implement layoffs as part of a broader restructuring effort. This could involve eliminating redundant positions, realigning resources to focus on core business areas, or streamlining operations to adapt to a changing market landscape or evolving strategic priorities. 3. Mergers, acquisitions and reorganizations Mergers and acquisitions often lead to workforce consolidation to eliminate duplicate roles. Layoffs become a tool to achieve synergies and cost savings during the integration process. 4. External market forces Shifts in consumer preferences, technological advancements, regulatory changes, or industry disruptions can all prompt companies to adapt by reducing their workforce. Layoffs help them adjust to the new market dynamics and maintain competitiveness. Why are employees the first to get cut? Employees are often the first to be cut because they represent a significant portion (about  ( about 65% - 70% ) of a company's total costs. In short, keeping employees is expensive, which unfortunately makes them a prime target for cost-cutting measures. Unlike expenses in areas like sales tools or R&D, which can be adjusted or scaled back, employee salaries and benefits are relatively fixed.Imagine a company has to pay an extra 20% on each employee's salary. So, if an employee currently makes RM4,000 per month, the additional cost would be 20% of RM4,000, which is RM800. This means the total cost per employee would increase to RM4,800. Because of this significant increase, the company is looking to cut back on their overall expenses by 30%. This means they need to find ways to save money across the entire company to offset the extra cost per employee. To achieve this, the employer has two options: either lay off 30% of the employees or reduce each employee's salary by 36%. While both methods aim to reduce costs, most companies are likely to choose the first option, as cutting salaries can negatively affect employee morale and productivity.Layoffs are also quicker and easier to implement than restructuring departments or renegotiating contracts. Though this may seem harsh, it is often seen as the most efficient way to reduce costs. In summary, reducing headcount offers a more immediate and direct reduction in overall costs for companies. What to consider as an investor If you’re an investor wondering how to manage your portfolio amidst the trend of layoffs, consider these key factors: 1. Impact on Profitability Reducing headcount can increase operating profit and free cash flow, potentially boosting stock prices. However, the immediate financial benefits may vary based on the company's overall health and market conditions. 2. Timing and Context The timing of layoffs can affect how quickly the benefits are seen in financial reports. Consider whether the layoffs are part of a strategic restructuring or a response to external pressures. 3. Employee Morale and Productivity Layoffs can negatively impact remaining employees' morale and productivity, which might offset some financial gains. Companies with poor morale may struggle to maintain productivity and innovation. 4. Underlying Business Issues Layoffs might not address fundamental problems within the company. Look beyond immediate cost savings to understand if the layoffs are masking deeper issues. The Bottom Line To summarise, layoffs aren't a guaranteed path to stock price growth. Don’t just assume a stock is going to go up just because it cut people. The recommended approach is to do thorough research and monitor long-term trends to properly assess the impact of layoffs on stock prices. This includes looking at the company's financial health, strategic goals, and market trends. Subscribe to our   financial newsletter  for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Have you ever had a disagreement with your partner about money? They say that financial issues are the leading cause of divorce.  The Department of Statistics Malaysia (DOSM) showed that divorce cases rose by 43.1% in 2022 during the COVID-19 pandemic . And while money can't buy happiness, it can certainly wreak havoc on your relationship if not managed properly. But how do we navigate talking about finances without potentially blowing a fuse in the relationship? Today, we’ll share some tips with you on how to talk about money with your partner  so you can successfully set financial goals as a couple.  Why Money Chats Matter  Initially, you may feel compelled to keep personal financial matters private—you stick with your own finances while your partner handles their own account. This might work for some; however, no matter how long you’ve been in a relationship, having an open conversation about finances is still important for a healthy romantic relationship. According to a Bread Financial study , 44% of couples responded that they wish they had more similar financial mindsets as their partners, while 20% prefer having different financial mindsets. Baby Boomers (54%) believe they are the most financially compatible with their partners, while Millennials (23%) claim the opposite. Think of it this way: You and your partner are a team. You can only reach your goals if both of you are on the same page. Sure, you may have different strategies, but in the end, your end goal is the same. And discussing finances together isn’t just about budgeting  or saving . It’s also about aligning your life goals and doing strategic financial planning  to reach your end goals. Figuring out the nitty-gritty of budgeting and expenses together can feel really overwhelming. So, here is a simple guide on how you can talk to your partner about your goals.  How to talk to Your Partner About Goals Begin by listing the financial goals that you have. Split them into two categories: Team Goals:  These are shared aspirations that both you and your partner share, such as buying a dream house, travelling, and investing in your children's or future children’s education. Individual Goals:  These are aspirations that fall under personal goals like starting your own business, joining a marathon, or anything that’s close to your heart. Whether your personal goal involves your partner or not, it’s alright to have them even when you’re in a relationship. Writing down these goals helps in visualising them and understanding each other’s aspirations better. It also sets the stage for an open discussion about your dreams and how to achieve them together. When you and your partner sit down to discuss money, there are a few ground rules you should follow: Rule 1: Listen Without Judgement Listen to your partner’s goal without judgement. Avoid ridiculing or running the guilt trip on them for having their own goals. Your partner’s goals and aspirations are part of their identity, so it’s important for you to respect them. Not giving your partner a safe space to share their dreams may make your partner resent you, which could harm your relationship in the long run.  Rule 2: Reassure Your Partner During your discussion, be sure to reassure your partner that they are still your priority. Clearly communicate that you want them to be a significant part of your life and that sharing your dreams with them is a way to deepen your connection. Your partner might feel apprehensive about some of your ideas, but you can balance your excitement with the reassurance of your commitment to them.  Be sure to share your goals and values with each other so that you can both settle on a common goal.  How to Set Financial Goals Together Step 1: List Your Goals in Detail Grab a pen and paper and list your goals in detail. Include what each goal means to you both as a couple, and as an individual. For example, a personal goal you might have is wanting to wear a Rolex watch because it makes you really proud of yourself. The goal of this exercise is for both of you to understand each other's core values and discover what motivates you and your partner to pursue these goals.  Step 2: Prioritise Which Goals Matter  The next step involves both of you deciding which goals to prioritize. Narrow down to three goals to focus on in the near future: one for both of you and one for each individual. For your team goal, it could be saving up for your wedding or buying a new home to start a family in. For the individual, it could be buying a watch or joining a club. Tip: If some of your partner's goals seem a little off track, now is the time to discuss the feasibility of achieving those goals. If you have any concerns about any of the goals, practice active listening and try to express your concerns to your partner in a respectful manner. Share your thoughts on why you believe the other goals are more important now. Remember that the goal of this conversation is to bring you together so that you can foster unity and work towards a common goal to strengthen your relationship.  Step 3: Identifying and planning Once you’ve narrowed down your priorities, talk about the resources you need to achieve your goals.  For example, if you are trying to plan a vacation together, you will need to decide on your lodging, possibly transportation or airlines, and your itinerary, which could include shopping, cafe hopping, or visiting tourist attractions.  Don’t forget to take into account non-financial factors such as applying for annual leave, and which month is best for your trip. For example, your partner may have a family tradition of celebrating Christmas together every year, which is a must-attend family event for your partner but may not be as important to you. The bottom line is that both of you will need to find a middle ground that you’ll both be happy with. Step 4: Evaluating and Prototyping The next step is to evaluate and prototype the scenario in which you both enjoy the goal or imagine how it might play out. You may discover that the resources are not worth the investment for those objectives. However, you may discover that those things are far more important than you previously thought.  Don’t skip out on this step because it will help you figure out whether it is really something both of you might want to work on. Assess the importance and feasibility of the objectives. Determine whether the resources spent on these goals are worthwhile and if they are consistent with your core values. Step 5: Review and Adjust Your Strategy   The final step in this process is to review and adjust your strategy. Repeat Step 3 for each of your other goals, and keep in mind that this will not be a one-time discussion. It could be an ongoing conversation as you both grow in your relationship. Be patient, and take your time to understand each other's perspectives. Additionally, this is not a one-size-fits-all approach, and know that it’s alright if your strategy or goals change over time.  For example, my partner and I had planned to buy a house, but after going through the process, we decided we wanted a property that we could personalise and truly make our own. So instead of rushing to buy an apartment or house, we decided to focus our efforts on investing  in the hope that we can accumulate sufficient funds to buy our dream home. To add on, we are also in a stage of our lives where we want to explore our hobbies and do some travelling, we’d rather channel our financial resources to these things than rush into buying a home. As a result, we came to a point where we could maintain our happiness and financial health. It helped us to understand that while a beautiful home is something that we want, it’s not urgent enough for us to own it right now. And there are other goals that we could go for instead.  Conclusion So if you have the time, I encourage you to take the time off this weekend to talk about finances with each other. Talking with your partner about money is a continuous process of self-discovery and mutual understanding. It helps you become close with each other as well. Remember that it’s about finding what’s truly important to each of you and how you can support one another in achieving those dreams. You may even find yourself rediscovering your priorities.  Subscribe to our   financial newsletter  for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Market volatility is inevitable, and with the Fed keeping interest rates higher for longer, potential economic shifts are expected. While volatility is a natural part of the investment landscape, it can pose potential risks to your portfolios. However, with a bit of strategy, you’ll be able to brave the market storm to preserve your long-term goals. In this article, we’ll explore the basics of futures trading along with some practical tips for you to get started. What are Futures? According to Investopedia, futures are “financial agreements that obligate parties to buy or sell an asset at a predetermined date and price.” But what does this mean? Imagine futures as having confidence in the future price movement of an asset. Let’s use Gold as an example. If you’re confident that the price of gold will go up, you might look at a gold futures contract to purchase it at today’s price. Then, as the gold price increases over time, you can sell it at a higher price when the contract expires. On the other hand, if you think the price of gold will go down, you might look at a gold futures contract that agrees to sell it at today’s price in the future. You can then buy it back at a lower price, therefore making a profit. If you’re still confused, don’t worry. Let’s take a look at these simple scenarios: Scenario 1: Prediction of Price increase in Gold value Suppose a jewelry manufacturing company needs gold six months from now. The manager is uncertain about future gold prices but is satisfied with the current price. To avoid risk, the manager enters into a futures contract with another risk-averse supplier, agreeing to trade a specified amount of gold at the current price in six months. After three months, the price of gold rises. The seller can now sell the futures contract (not the actual gold) at the higher current price, thus gaining from the price difference. Financial markets provide enough liquidity for traders to trade these contracts at any time. Scenario 2: Incorrect Prediction where Price of Gold falls The same jewelry company and supplier agree to trade gold in six months at the current price. However, after three months, the price of gold falls. The buyer must still purchase the gold at the original higher price, resulting in a loss as they could have bought the gold cheaper at the new market price. Benefit: Accurate prediction results in acquiring more valuable gold. Risk: An incorrect prediction results in a loss due to trading gold at a higher price than the market value. Experienced investors use futures for hedging to manage risk, while many retail investors use them for short-term speculation to profit from price changes. Strategic Futures Trading Bear in mind that navigating the futures market requires more than just predicting market trends; it requires a strategic approach to risk management. So, here’s what you can do to skillfully approach futures trading: 1. Get acquainted with market dynamics You’ll have to take a very holistic approach to comprehending the market dynamics of your chosen asset. This includes supply and demand factors, geopolitical influences, and economic indicators. Awareness of what causes volatility in the futures markets of interest is very important. 2. Create a trading plan Think of this as a much higher level of the SMART goals, except instead of Specific, Measurable, Achievable, Relevant, Time-bound, it’s going to be a comprehensive trading plan that helps with your trading decisions in a methodical and disciplined manner. It would consist of investment objectives, risk tolerance, criteria for trade entry and exit, and money management strategies (What does that spell out? IRCM?). It not only helps you to stay disciplined and focused but also provides a framework for continuous improvement and learning. 3. Stay informed Financial markets are influenced by various factors, from economic data releases to geopolitical events. Staying aware of these developments and understanding their possible effects on the markets is crucial for making informed decisions. 4. Keep learning The futures trading landscape is complex and constantly changing. Staying educated about market trends, trading strategies, and financial instruments can improve your ability to skillfully navigate market volatility. Who is it for? With that being said, futures trading isn’t for everyone. It requires a nuanced approach, especially considering the complexity of it all. Of course, it still offers great opportunities for hedging and speculation, but it also comes with a higher level of risk compared to more straightforward investment vehicles like stocks or mutual funds. So, if you’re someone who is already trading in stocks or ETFs and looking to diversify your portfolios or hedge against market risks, this is for you. Open your Futures Account Today Speaking of, did you know that you can do futures trading with RHB? Not only that, but if you open a futures account with RHB right now, you’ll get: Zero Brokerage Fees: Enjoy zero brokerage fees up to RM500 on all online buys for the first 60 calendar days after opening your account. This offer runs till August 31, 2024. Exciting Prizes: By logging in and trading, you earn entries into a grand giveaway where you could be the lucky winner to drive home a brand new Perodua Ativa SUV or win amazing vouchers worth more than RM200,000 in total. This offer runs till 31 December 2024. Futures trading with RHB right now would mean no excess fees at the start and potential rewards just for participating. Click here to sign up: https://www.rhbtradesmart.com/campaign/mr-money-tv *This promotion is subject to terms and conditions. The Bottom line If you're curious about futures trading and ready to put in the work to understand it, there's potential to make it work in your favour and RHB has just the right tools to get you started. Just remember, it's all about staying informed, sticking to your plan, and keeping a cool head. And with offers like RHB's, getting started might just be a bit sweeter. Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

When you think of Apple, what's the first thing that comes to mind? Probably the iPhone, right? Well, you're not alone. The iPhone is a big business for Apple, bringing in $383.2 billion-worth of revenue in 2023. That's a lot of money! In fact, in 2022 alone, they sold a whopping 232 million iPhones, 61 million iPads, and 26 million Macs! But Apple's not just about hardware anymore. Services like Apple Music, iCloud, and the App Store are also becoming a bigger slice of Apple's financial pie. In the beginning of 2024, these services brought in more than 19% of Apple's total revenue. That's a significant increase compared to earlier years. It shows that Apple is not just about selling gadgets anymore. But speaking of gadgets, the iPhone is still the king of Apple's revenue. In the early part of 2024, iPhone sales made up a whopping 58.3% of all the money Apple raked in. That's not surprising, considering how popular iPhones are worldwide. Even though other products like the Apple Watch and the iTunes Store are making more money than before, the iPhone remains Apple's cash cow. However, there's a bit of a bump in the road, particularly in China. Apple's iPhone sales there dropped by 24% in the first six weeks of 2024 compared to the same period in 2023. That's a big hit! It means Apple's market share in China went down from 19% in 2023 to 16% in 2024. China is a massive market for Apple, so this decline could be a cause for concern. Now, considering Apple's resilience and consistent outperformance in the market, it's natural to wonder whether investing in AAPL stocks remains a wise decision. The Apple Inc. stock (APPL stock) has been on a tear lately, jumping 52% since the beginning of 2023. This impressive growth comes despite tough economic times and a slight revenue dip in the same year. Why the hype? Well, Apple has a knack for staying strong when others falter. Even when things get rough, Apple manages to outshine its competitors. Just look at its stock performance over the past five years - it's been consistently impressive. But it's not all smooth sailing. Recent challenges could mean bumps in the road ahead for Apple's stock. So, should you consider buying AAPL stocks? APPL's Strength and Future Potential Brand Allegiance Amplification:   People love Apple products, and surveys show that a vast majority of iPhone users plan to stick with the brand for their next smartphone. A study by ZipDo found that a huge 92% of iPhone owners are planning to stick with Apple for their next phone purchase. This means that once people start using Apple products, they tend to stick with them. Apple's luxury branding and ecosystem of services keep customers coming back for more, which is good news for investors. Transitioning from Hardware to Scalable Software Solutions:   Apple's not just about gadgets anymore. They're diving deep into services like the App Store and Apple Music, and it's paying off big time. In 2023, these services brought in a whopping 22% of Apple's revenue, making it the second largest division within the company. With 88 million subscribers jamming out on Apple Music and over 75 million tuning in to Apple TV+, these services are becoming serious money-makers for Apple, giving them a diverse income beyond just selling hardware. Financial Vigor and Flexibility:   With over $166 billion in cash reserves, Apple has plenty of resources to invest in new products and services. Its strong balance sheet also gives it a safety net during tough economic times. Prolonged Growth Strategy:  Despite facing some challenges, Apple remains a solid bet for long-term growth. Sure, there have been some bumps in the road, like declining sales and rumors of iPhones being banned in Chinese workplaces. But Apple's not one to back down easily. They're always innovating and investing in new technologies, like digital services. So, while there might be some tough times ahead, Apple's history of bouncing back and their focus on the future suggests they're still in a good position for growth. Dominant Brand Influence:  Apple is not just any tech company; it's already the world's most valuable company. With a reputation for quality products and exceptional customer service, Apple stands tall as one of the most valuable brands globally. Its name alone commands respect and recognition, giving it a significant edge in the fiercely competitive tech industry. So, it's not just about the iPhones and MacBooks; it's about the trust and loyalty that Apple has earned over the years, making it a powerhouse in the market. Risks and Considerations for Investing in Apple Revenue Vulnerability to iPhone Dependency:   Apple makes a big chunk of its money from selling iPhones. If people stop buying iPhones as much, it could hurt Apple's profits. Revenue Vulnerability to iPhone Dependency:   China is a huge market for Apple, but it's also a tricky one. In the first six weeks of 2024, smartphone sales in China dropped by 7% compared to the previous year. This decline affected major brands like Apple, OPPO, and vivo, which all experienced double-digit decreases in their sales, according to Counterpoint Research. There have also been issues like factory shutdowns and government regulations that could affect Apple's business in China. Valuation Apprehensions:   Some experts are worried that Apple's stock might be too pricey when compared to how much money the company is actually making. As of March 2024, Apple has a market capitalization of $2.626 trillion, which means it's the world's second most valuable company by market value. Market capitalization is just a fancy way of saying how much the whole company is worth. But here's the thing: if a stock's price is too high, it might not leave much room for the stock to grow in the future.  Diminished Growth Projections:   Apple's growth might not be as speedy as it used to be. Experts think that Apple's profits won't increase as much in the future, mainly because smartphone sales are slowing down. According to Counterpoint Research, in 2024, Apple's sales might only grow by around 3%, which is not a huge jump. While things might be a bit tough in North America, there's hope for growth in other places, especially in emerging economies where people are starting to spend more on high-end products, like Apple's. So, even though Apple might not be growing as fast as before, there's still potential for some growth in the future. Heightened Competitive Landscape and Innovation Dynamics:   Other companies are always trying to outdo Apple with new and better products. If Apple can't keep up with the competition, it might lose customers and money. Conclusion Deciding whether to invest in Apple stocks isn't just about looking at the shiny gadgets or the big numbers. It's about understanding the risks and rewards and what's best for your own financial goals. Apple has its strengths, like loyal customers and a strong balance sheet, but it also has its challenges, like dependence on iPhone sales and competition from other tech giants. Before diving into investing in Apple or any other stock, take the time to do your homework. Consider your own financial situation, how much risk you're comfortable with, and whether Apple fits into your long-term investment strategy. Ultimately, investing is a personal decision, and it's essential to make informed choices that align with your goals and values. So, whether you're bullish on Apple or cautious about its prospects, remember to stay informed and make decisions that are right for you. Bonus If you're seeking a platform to begin your journey on stock investment, you could explore M+ Global,  a trading platform by Malacca Securities. With its innovative features and extensive market coverage, including access to renowned markets like the United States and Hong Kong, M+ Global offers an ideal avenue to invest in stocks such as Apple and more. Its user-friendly interface ensures a seamless trading experience, while the option to trade using Malaysian Ringgit (MYR) adds convenience. Moreover, benefit from dedicated customer support with over 200 licensed dealer representatives available to address any queries or concerns.  Plus, for a limited time only until April 30th, deposit RM2,000 and receive 5 free Grab shares ! This is an exclusive offer you don't want to miss. Whether you're eyeing Apple or other top stocks, M+ Global  equips you with the tools and resources to make informed investment decisions. Make sure to use code: T30E . Start your journey towards financial growth and success today with  M+ Global .