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In Singapore, we need to be at least 21 to legally vote. It’s also the age where we become eligible to register our marriage and to buy and own a property in Singapore without needing the consent of our parents. That is why turning 21 is often seen as a symbolic transition to adulthood.
However, for those who wish to start their investment journey before 21, we may be pleased to know that the minimum age in Singapore to open our own brokerage account is 18. This means that students studying in junior colleges, polytechnics, and institutes of technical education, can start their investment journey if they want. However, most rarely do so.
One young Singaporean who understands how it’s like to be starting his investment journey at a young age is Gavin Tan, a 21-year-old who is currently serving his national service. In 2019, while most of his polytechnic classmates were looking to take driving classes or to explore clubs, the then-19-year-old Gavin made what would be considered an unorthodox decision – he started investing in stocks.
Since then, Gavin has built a personal portfolio of more than 20 companies, consisting of stocks that are based in Singapore and the U.S. Gavin also started his own investment blog –sgstockmarketinvestor – where he shares his thoughts about investing and his own personal portfolio performance.
In this edition of #theeverydayinvestor, a content series written in collaboration with Tiger Brokers (Singapore) where we feature everyday investors around us, we chat with Gavin to find out what sparked his inspiration to start investing at a young age and some of the challenges he has faced when he started investing.
Read the other articles in our #everydayinvestor series.
Timothy Ho (Timothy): What inspired you to start investing at the age of 19? Was it something you have always wanted to do since young?
Gavin Tan (Gavin): I would say that I have always been interested in side hustles and generating multiple streams of income ever since I entered Polytechnic. During my first year, I decided to pick up sales and worked as a sales promoter for printers, laptops, and even TVs. It was an interesting experience as I was incentivised to hit higher sales because my pay was largely commission-based.
Moving into my second and third year, I ventured into other side hustles that required less work, effort, and time. I traded crypto back then, but due to my small capital and lack of experience, I wasn’t earning a lot, perhaps just a few hundred dollars. Towards the end of 2018, I was exposed to investments, stocks, and Warren Buffett who eventually became my inspiration. That’s how I started.
Timothy: What were some of the first few stocks that you invested in and the reasons why?
Gavin: I started off with local stocks because Warren Buffett always emphasised the circle of competence, so what’s a better place to start off than your own home ground where you have the home advantage. My first few investments included ISEC Healthcare, Ascendas REIT, and all four Mapletree REITs (Logistics, Industrial, Commercial, and North Asia Commercial). The five REITs were chosen because they had a good track record, growing DPU and the business model is pretty straightforward.
Read Also: Mapletree REITS For Singapore Investors: Mapletree North Asia Commercial Trust (RW0U); Mapletree Logistics Trust (M44U); Mapletree Commercial Trust (N2IU); Mapletree Industrial Trust (ME8U)
Taking Mapletree Commercial Trust as an example, I visit VivoCity often and realise that the mall is always crowded with high footfall. This is a good sign because a higher footfall gives the REIT the room to bargain for higher rental. On top of that, when looking at their track record, the DPU and NAV per share have been growing consistently over the past few years. This gave me the confidence and assurance that the management is doing something right and will most likely continue to do well in the future.
Timothy: How did the people around you react to you starting your investment journey? Did you receive support from them, or did they discourage you from investing because they felt it’s ‘risky’ to invest for a young person?
Gavin: I had to tell my parents beforehand because I didn’t know how to set up an account back then, so they brought me to the bank to get it sorted. My parents were skeptical at first and told me, “Don’t anyhow play stocks and get yourself burnt”. Nevertheless, I managed to convince them to trust me and to let me experience this myself. I took all I had in my savings account, which was about $2,000, and this was how I started my investment journey. I didn’t tell any of my friends because none of them was interested in investing nor did they have a good impression of investing.
Fast forward to today, my parents trust me more since I’ve gained some experience and even let me invest for them as well! I also have friends who started coming to me for advice and help as they too, have started their own investment journey. It’s nice to see that more people around me are getting interested and starting their own investment journey.
Timothy: Prior to starting your investment journey, were you already familiar with stocks, or did you only learn more about them after starting? How did you pick up investment knowledge?
Gavin: Prior to starting, I was a complete beginner with little to no knowledge regarding finance and investments. I did have some knowledge that I learned in Secondary School because I took Principles of Accounts, but I had forgotten most of it already. I picked up all my knowledge through the most unorthodox method ever heard – watching Warren Buffett interviews and AGMs on YouTube over and over. I did not attend any courses or workshops because I felt that the money could be better used in learning through the stock market directly myself.
I also feel that learning how to invest is like learning how to swim, you cannot just read and assume you have learned all that you need to know. You need to dip your toes into the water, feel the temperature and try to swim yourself. Therefore, I decided to just invest in the stock market first even though I knew that I had a lot more to learn.
Timothy: One of the gripes that I often hear from young investors is that they don’t have enough capital to start. Was this a problem you faced as well?
Gavin: Back when I started in 2019, there were only local brokerages around. So, if you wanted to buy local Singapore stocks, you have to pay the high trading fees that could eat into your profits if you had a small account. Personally, I didn’t focus on the profits and losses at first but rather, learned how to invest properly.
A wise quote I heard a while back by a famous investor hit me hard and that was, “If you can’t even handle investing $10,000, how can you handle investing $1 million or even $10 million”. I felt that this was very true. If you can do it with a hundred dollars, you can easily do it with a thousand dollars. If you can do it with a thousand dollars, you can do it with a hundred thousand, so on and so forth. So, I don’t think it’s necessarily a disadvantage to start with a small capital.
Timothy: What are some challenges you face when you start your investment journey?
Gavin: One of the biggest challenges was admitting that you made a bad investment. It can be hard to cut your losses short after doing all the research, checking all the numbers, reading up on the news updates, and just having the stock plunged lower and lower without any sign of bottoming out. In the past, I traded penny stocks before and was burnt badly, suffering a 60% loss before I finally admitted defeat. After I sold, I felt a huge burden being lifted off my chest. I then proceeded to direct the net proceeds into stocks that had solid fundamentals and long-term growth potential rather than volatile gamble plays.
Timothy: Which brokerage platforms do you currently use for your trades?
Gavin: Currently, I am using Tiger Brokers (Singapore) for most of my SG and US stocks. I like using it mainly because of their low fees and easy-to-use Tiger Broker mobile app. Other than that, I also have stocks in my CDP account that I bought in the earlier days when I was using other local brokerages.
Timothy: What inspired you to start your investment blog? What do you hope to achieve with this blog for you and your readers?
Gavin: The inspiration behind the blog was because I didn’t have anyone to ask for help or bounce off ideas when I started out. I didn’t join any telegram groups or engage in any forums as well. I was pretty much alone throughout this journey, which was quite tough. 8 months after I first started investing, I decided to try writing a blog, sharing my investment thoughts and ideas with the public. This way, I could learn from others through their comments and questions as well as educate or teach those who are less experienced.
For the blog itself, I aim to create content that is unique and not easily found online. I felt that there are already a lot of these financial blogs and websites around, and they are mostly the same. The general content is superficial and lacks depth, which is something all readers and investors would already know. Personally, I have a tech background from having studied an IT-related diploma and interned in several tech roles. As such, I try to set myself apart from the rest, sharing more in-depth content and insights through my experience and knowledge. For example, when I cover tech companies such as Palantir or Snowflake, I try to bring more to the table rather than just reading off what the company website says.
Timothy: What are some tips to share with fellow young Singaporeans, some of whom might still be in JC, Polytechnic, and ITE, who are interested to start investing?
Gavin: First off, just get started! It doesn’t matter how young you are, as long as you are of legal age to start up a brokerage account, I suggest opening up one and start exploring early. Many youths, especially those that are around my age, tend to shy away from the term “investing” because they associate it with “gambling”. It is only gambling when you are blindly buying and selling without doing any research. If you do your research, understand the companies you are investing in, you are taking a calculated risk with your money.
I would like to share an analogy I always use when describing and talking about investing with my friends. Imagine your friend decides to open a lemonade stand today and asks if you’d like to invest in it with him. You guys each fork out $500 and own 50% of the business. A year passes by, and the lemonade stand made a net profit of $500. If you distribute that out to both of you as shareholders, also known as a dividend, you earn $250 through your initial investment of $500 without doing any work, assuming your friend runs the business himself. This is the beauty of investing! You invest your money and let it grow with little to no effort coming from you. The only thing you need to know is to understand how the business functions and to decide whether to invest in it.
Just Do It!
When talking to Gavin, one thing that struck me was how similar investing is to other life skills that we want to pick up – swimming, cycling, rollerblading, playing the piano. The younger we start and the more we practise, the better our chances of doing well.
The same concept applies to investing, which is a life skill that we want to start nurturing from young. As young investors, we are bound to make mistakes. However, these are mistakes that we can’t avoid even if we start our investment journey at an older age anyway – it’s like learning how to rollerblade, you are still going to have your fair share of falling even if you learn rollerblading as an adult.
For investing, there is a certain legal age that we must be before we can start. Obviously, the rationale behind why the law doesn’t allow a 10-year-old to start investing is like how we don’t let them drive a car on the road. The minimum age criterion is in place for a reason.
Yet, once we turn 18, we are deemed to be mature enough to start our investment journey. And just like driving, the sooner we get started, and the more we get to hone our skills, the more beneficial it would be in the long-term.
Starting your investment journey with lesser capital as a young investor isn’t necessarily a disadvantage. With lesser capital, young investors can afford to learn from inevitable mistakes that they make when starting out. For Gavin, he learned that investing in penny stocks with the hope of getting a high return in a short period of time wasn’t exactly a strategy that was working for him. While the loss he incurred (about 60%) was significant, his investment quantum was still small at that time.
To reduce brokerage fees as a young investor, Gavin currently uses Tiger Brokers (Singapore) for his trades. With exceptionally low commission fees (USD 0.005/share, minimum USD 0.99 per trade) for both U.S. stocks and Singapore stocks (0.04% of trade value, no minimum amount), young investors like Gavin can afford to invest a small amount for each trade without having to worry that commission charges would eat into his returns.
Beyond the Singapore or US markets, Tiger Brokers (Singapore) also allows investors in Singapore to access the Hong Kong, China and Australia markets.
For NSFs, like Gavin, who spend a large part of his day in camp, Tiger Brokers (Singapore) is suitable as it offers an intuitive Tiger Trade Mobile App that allows investors to trade anywhere they are, without the need for a laptop or desktop. This app is available on both the App Store for iOS users and Google Play for Android users.
Besides placing our trades, the Tiger Trade Mobile App also allows us to stay in touch with relevant financial news. Based on the stocks that are in our shortlist, the app can provide us with relevant information about companies, sectors or markets that we are interested in. It also has a calendar section that shows major events, dividend dates, earnings and financial report releases and IPO calendar. This makes it easy to keep track of market-related news, whether we are in school, at home, in the office or even in army camps.
If you are of legal age to start investing and have been procrastinating to start your investment journey, maybe it’s time to do it today via Tiger Brokers (Singapore).
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