I had been writing several articles that gave a comprehensive introduction on how to invest in the Philippine stock market . Focus was given on the basic principles that each prospective investors should know. In this article the advantages of investing in the stock market will be given focus.

I have stated before that the stock market is just another vehicle of investment. A good question to ask yourself is why should you choose to invest in the stock market. What advantage would you get in investing in the stock market ?

The question could probably be best answered by the following. Be advised that the examples given refer to Philippine based companies and currency. Should you wish to view the article in its entirety please visit my blog.

1.) Investing in the Stock Market has potential for great returns – Every financial expert would tell you that when the market has a potential to go up, it really goes up. Returns could range to as high as 30 % to 200 %+ per annum or even more. In the long term it is expected that you would really profit at lot. In 1997, the price of Globe Telecom Inc. (GLO) stocks was only P152.00 per share. Buying the minimum board lot which was 10 shares during that time would have only cost you about P 1,520.00. Now the price per share of Globe is P 1,620.00+. The value of those shares is right now P 16,200. That means in ten years time your money has grown times ten or a 1000 percent increase. It also means that you have a return of an average of 30 % per annum. Not bad compared to putting it in a time deposit account at less than 4 % per annum. You might also be interested to know that the Philippine stock market is at its highest these days. A bull run is still expected for the next 2 to 3 years. So hold on to your horses, I mean bulls and make the best out of the bull run.

2.) You become “part owner” of the company that you are investing in. – You might probably be thinking of franchising a Jollibee outlet. However doing so would cost you somewhere between 20 to 25 million pesos add to the fact that you have to put in time and effort to run the store. Why not buy stocks of Jollibee instead of franchising a Jollibee outlet in order to own your “own” Jollibee. You get to own 100 JFC shares (Jollibee Foods Corporations – JFC) for only P 5,000+. In so doing you “indirectly own” the more than 1414 stores in the Philippines and 175 in other countries including Red Ribon, Chowking, Deli-France, A popular fastfood chain – Yonghe King in China and popular teahouse chain from Taiwan called Chun Shui Tang including Jollibee’s pilot restaurant “Tio Pepe’s Karinderia.” Now that is so cool! The next time you eat at Jollibee you could proudly say to your friends and relatives that you like to eat there because you “own” part of it. You more be more prompt in paying your telephone bills if you own stocks of PLDT or Globe telecoms.

3.) You belong to a special group of people when you invest in the stock market -

When somebody will ask me to join a multi-level marketing scheme I always ask when the company started. The reason is that because if it started a long time ago, then my chances of recruiting other people will be slim because almost everybody I know has already been recruited.

However take note that investing in the stock market is not mutli-level marketing. Whether the market is saturated or not does not matter. But it is always good to know that we are among pioneers to take advantage of the potential of the market.

Most of those who invest in the stock market are from the class A and B segments of the population. An Asian Development Bank study done in 2005 revealed that only 600,000, out of the of the country’s 87 million population, invest in the stock market. This means that only 0.7 % of the population are involved in stock market trading.

Want to know more about investment strategies ? Visit the blog of Zigfred Diaz where he blogs about several interesting topics such as investments, financial management, business, making financial online and Stock market investing