I guess you’d like to know me better – so it’s time I spilt the beans on
my own investing story.
It all started in 2009, when I was a 19 year-old freshman in SMU.
While sitting with my group-mates one lesson, I chanced upon an article
that highlighted the IPO (Initial Public Offering, or the first time a private company’s shares are made public or listed on a public stock exchange) of a Government-Linked Company (GLC) at the time.
Credit source: Reuters
One of my group-mates, an experienced investor (in his own words) and a Year Accounting student glanced over the article I was reading and commented:
“IPO launch by GLC? Suree make money wan.”
Curiosity piqued, I asked:
“Really? How do you know?”
“Trust me. I invested before. Government* won’t let it fail.”
*In Singapore, this is generally the case due to the Government’s strong credit score, as Moody’s credit ratings of AAA reflects.
And that was all it took to get me started. After lessons ended, I headed to the Central Depository Pte Ltd (CDP) building to open my first trading account and coincidentally, met my soon-to-be stock-broker, Tom,in the same building.
He had just started in his trade and was reaching out to potential customers at his stock-broking information booth that day.
Upon learning the reason I had set up a CDP account, Tom agreed to guide me to secure the IPO once my CDP account was approved. These included wise words, such as:
“Pump in as much money as you’re comfortable with. It’s not easy to secure a lot.”
“How to apply for IPO? Ok go to your DBS ATM…entered? click ‘Apply for shares’…”
(Tom would go on to save my inexperienced hide in years to come as I navigated the vast and complex world of investing)
And through that first attempt at IPOs, I was able to net a single lot for all my effort (back then – a minimum lot was 1,000 shares).
$1.98/share x 1,000 shares = $1,980 + $2 IPO application = $1,982.
The IPO was a huge success. GLP’s share price skyrocketed within hours of the launch.
Stunned, and not being experienced enough to time the markets, I cashed out quickly at the share price of $2.19/share.
Total profit: $2.19/share x 1,000 shares – $1.98/share x 1,000 shares –
POEM’s Young Investor Commission of about $25 then = $185.
To a young undergraduate who had little savings and worked hard as a part-time tutor then, the sudden inheritance of nearly two hundred dollars within a day or two for hardly any work done was mind-boggling.
And I was hooked.
On hindsight, investing on a whim, or simply based on a friend’s hot tip or advice hardly seems like a sound investment decision to make.
However, I was lucky that trade and till this day, hold a slight personal bias and tendency towards IPOs as an investment asset class.
What is your investment story?
Live long and prosper,