OFW investor in London and the BREXIT | Marvin Germo

OFW investor in London and the BREXIT

By: Marvin Germo | June 23, 2016

BREXIT or BREMAIN?

Before I go on with the whole post and answer our reader’s question.  In just a few hours before we will know if there will be a BREXIT or not!  This could change the course of how businesses will deal with the UK over the next few years, should a BREXIT happen.  To those who are also asking what is the impact of the BREXIT in the financial markets?  I believe that should BREXIT happen, the GBP would depreciate to around 15-20% in value.  This in the long term would help boost the stock market but over the short term this could drive the stock market lower due to the negative sentiment that it produces.

Mixing it up

 I would usually post our reader’s questions first but for this very specially blog I will be allowing one our readers to share his story!

The heart of the matter

 Why am I mixing it up?  I love sharing my opinion, I love teaching and giving sound investment principles so that more and more people get a good foundation on investing.  However, it would also be good to hear stories of other people that have made it in life. I hope that their stories would be an inspiration to all of us, because we all can learn from each other.

Catch me in my live training events! (quick plug)

Stock Smarts UAE

To those who want to take it a notch higher and want a good foundation in stock trading and investing.  I would like to invite you to our live seminars in Metro ManilaSingaporeUAEQatar and New Zealand.  The heart of why I do this seminars is I want to build a generation of Filipinos with the right foundation in stock investing.  I want to bring smart investing to every Filipino around the world!  This is my passion and this is what I want to do over and over!  To bring more consumers to investors!  We will be teaching different techniques from how to select the right stocks up to how to find the perfect timing in buying and selling stocks.

Stock Smarts Singapore – June 25 & 26, 2016
Stock Smarts UAE – July 15 – 23, 2016
Stock Smarts Qatar – July 25 – 30, 2016
Stock Smarts New Zealand — August 5 – 8, 2016
Stock Smarts Manila —  September 3 & 17, 2016
Stock Smarts Davao —  November 5 & 6, 2016

Stock Smarts Singapore

The Question

“Hi Mr. Marvin!  I first met you in your first seminar in Singapore in 2011, it was even called Money Talks back then.  I was fortunate to meet you and attend your talk 2 week before I was assigned to London.  I’m glad that my friend forced me to attend!  Looking back investing on education and on myself was one of the best decisions I have ever made!  I agree with you sir that you are your best investment and you must invest in yourself first!    
I am sending this email as a thank you to you, as I was in debt back then and was just spending like crazy.  After your seminar it made me realise the value of saving and investing early and it pushed me to pay may debts first and start fixing my financial house.  2 years later, I was out of debt, I had adequate savings and I was investing in the stock market!   Your first book was out already by then and I had it shipped here in London so I could just read and get as much knowledge as I can.  It gave me one of the best insights about starting in the stock market.  After reading your book I got a renewed confidence to invest!  Then your 2nd book came out a year after, in that book I learned more about fundamental and technical analysis just at the right tim because that was when the IPO of Double Dragon came out!  Sir Marvin!  I bought DD at 2!  I liked what you said in your videos about dividing your portfolio into trading and investing!  

I was moving in and out of DD from 2 to 9, then I bought back again later at the breakout at 10 and sold at 25.  Then I traded others stocks while waiting but had the chance to buy DD back again at the breakout of 25 and sold that at 40.  Then I bought the stock again when it broke out of 40 and I sold from 60 to 65!

As for my investment account, I sold everything at 60 Pesos sir and I had an average buy price of around 6 pesos!  Thank you so much for all the principles!  It has helped me not just move out from debt but now I have adequate savings to go home and just live passively and probably still do stocks on the side.  

My question is this sir, my boss already told me that should the Brexit happen our company might be hit in a big way.  This leads me to wonder that I might be let got after.  My question, if the Brexit happens and I get let go by the company, should I just go home to the Philippines and just trade stocks and do business?  I am 38 years old, single and I am not a breadwinner.  I already computed it that even if I transfer to the Philippines and just live by my investments, I can already sustain my lifestyle since the cost of living is low.  I have computed that I can comfortably live by 50,000 Pesos per month.   

What do you suggest sir?  Your opinion is highly important to me and I hope you get to read this letter.”
John David S., London

My answer

Hi John David!  It’s messages like this that excite me!  Thank you so much for the kind words!  It’s just an amazing feeling to be part of your investing journey!
Before I answer your question, I’d like to salute you for the great trading and investing in DD!  I’m glad that because of that you were able to accumulate a substantial amount already that could aid in your retirement.  DD is such a great text book example of how breakout’s work.  I believe this can be used as a great case study for people who would like  to study and time breakouts.

Congratulations

It’s nice to know that you have accumulated so much at such a very quick pace.  I am guessing that you have placed large amounts of money in DD thus giving your relatively larger gains.  Either way, you should always go back to the drawing board and count how much do you actually need to survive.  This will allow you to see if the money that you have incurred is good enough that if invested in a bond or preferred share it could still give you passive returns.  Should you decide to go back to the Philippines it should be something you know and you know in your heart you should do and it should be something that you have computed through very well.

Your operational expenses

This means that if you have computed that your monthly expenses in the Philippines to be 50,000 Pesos (600,000 Pesos a year) you would need to find an investment that would replace that income no matter what happens in the market. This means that if you are investing your money in preferred shares that gives you 6%, you would need 10,000,000 Pesos.  You can also try just using capital appreciation in the stock market if your capital is lesser however this would subject you to bigger risk.  My suggestion is if you really want it to be passive invest in stocks with lesser volatility.

Additional funds to let your money grow

On top of the money that you will place in conservative investments it would be good if you still have an amount above and beyond that so you can invest that in stocks for more aggressive trading or you can use those additional funds should you want to start a business. Regardless of what happens though, since your operational expenses are already covered you can do others things like look for a job just to add to your nest egg until you figure out what you want to do.

Should you get married and have kids

Of course these computations now are just while you are still single.  Everything would change though when you get married and if you have kids.  You have to realign your computations to make this work!

I hope this suggestions help you!  If the numbers match then go for it and comeback home!

I’m excited to share my latest book, Where Should You Invest?    This will answer one of the biggest questions on the what, where and when you should invest on. I will also tackle the concept that there are certain investments that work well with others and some investments that don’t work well at a certain investment phases.

This is aimed to help investors have a holistic sense on how they can grow, maximize, and preserve their wealth!(Stock Smarts Book 4 is also coming this year)  I also feature other books in my website with authors that I respect which have different expertise in Finance, Business, Investing and everything else in between.

For more details and to order: Marvin Germo Book Orders

Marvin Germo Book Orders