How Much Do You Need To Invest

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How Much Do You Need to Invest in Philippine Stock Market?

by BDO Securities | Oct 10, 2023 | 9 min. read

The stock market can be an incredible way to invest your money for long-term growth. If you’re wondering how much is needed to invest in the stock market in the Philippines, you probably have a few different questions.

Maybe you’re wondering how much you should invest in the stock market – the recommended amount to invest monthly. Or you may be wondering the minimum amount needed to open an account with an online broker? Perhaps you’re even thinking about the fees associated with investing, and if you can afford those fees?

In this article, we’ll answer all these questions - and more!

Brokerage account minimum

Let’s start with the easiest question first – what’s the minimum needed to open an account with an online broker?

You may be surprised to hear this, but there is NO minimum account balance with BDO Securities! All you need is a BDO savings account and online banking. If you have that, you can literally open a BDO Securities account in as little as 5 minutes and deposit any amount of money you wish into the account. That should answer your first question – there is no minimum amount needed to open a brokerage so you can invest in the Philippine stock market.

Online brokerage fees

We know opening a brokerage account with BDO Securities carries no minimum account balance. The next question is about fees – how much are they and can you afford them?

BDO Securities charges a very low fee when it comes to buying and selling stock.

Fees for buying stock with BDO Securities

Below is an example of the fees if you buy PHP 10,000 of stock in a company.

Fee Name	Fee	Example: Buying PHP 10,000	Fee
Securities Clearing Corporation fee	0.01%	PHP 10,000 x .010%	PHP 1.00
Broker’s Commission	0.25%	PHP 10,000 x .25%	PHP 25.00
Value Added Tax (VAT)	12.00%	PHP 25 x 12%	PHP 3.00

Total Fee to buy PHP 10,000 of stock PHP 29.00

Net investment after fee PHP 10,029.00

The above example shows the fees associated with BDO Securities (including VAT) are very low – to buy PHP 10,000 worth of stock in a company would cost only PHP 29 (0.29%).

Fees for selling a stock with BDO Securities

Below are the fees associated with selling a stock through BDO Securities

Fee Name	Fee	Example: Selling PHP 10,000	Fee
Securities Clearing Corporation fee	0.01%	PHP 10,000 x .010%	PHP 1.00
Broker’s Commission	0.25%	PHP 10,000 x .25%	PHP 25.00
Value Added Tax (VAT)	12.00%	PHP 25 x 12%	PHP 3.00
Sales Tax	0.60%	PHP 10,000 x 0.60%	PHP 60.00

Total Fee plus tax to buy PHP 10,000 of stock PHP 89.00

Net proceeds PHP 9,911.00

The total fee to sell PHP 10,000 of stock with BDO Securities (including VAT) is only PHP 89.00.

While the fees to sell stock are slightly more than the fees to buy stock, they are still very low. To answer the question – fees shouldn’t be a problem when investing.

How much should you invest monthly in stocks?

There’s no one-size-fits-all approach when it comes to the amount needed to invest in the stock market. The amount of money you should invest depends on your current finances.

For example, maybe you already invest in real estate and want to add stock market investments to your portfolio. In this case, you will likely invest less in stocks than someone in a similar financial situation who is only interested in buying stocks.

A good rule-of-thumb is to save a percentage each month tied to your income. What does that mean? It means you should analyze your finances and decide what percentage of your income is available for you to invest each month. Many financial experts recommend saving 15% - 20% of income. Of course, if you can save more than 20%, you should do so. If you can only save 5%, you should save 5%, then make goals to slowly increase your percentage of investments over time.

How much should you invest to build a portfolio of stocks?

When you invest in stocks, it’s important to add diversification to your stock portfolio. What’s diversification? It’s the process of buying multiple different investments instead of adding all your money to one investment.

For example, diversification in the stock market means you shouldn’t add all your money into one stock. If that one stock has a financial catastrophe, you’ll lose all your money. If you own 20 stocks, then that one stock with a financial catastrophe doesn’t hurt as much because you have 19 other stocks.

In order to create a portfolio of stocks, you may want to buy a minimum of ten to twenty stocks…or more.

Conclusion

When it comes to the amount needed to open a brokerage account and invest in stocks, there’s no minimum account balance with BDO Securities. The ability to open a brokerage account is simple – anyone with a BDO Savings account can do so. The fees to buy stocks through BDO Securities are also very low, anyone can afford the fees.

However, it’s recommended to invest a percentage of your income each month. If you can save 15-20% or more of your income, that’s a great start. If you can’t invest that much, save as much as you can, and try to increase your investment over time.

When purchasing stock, it’s important to diversify. Buying ten to twenty (or more) stocks can help you diversify your portfolio. So keep investing as much as you can each month, and slowly add new stocks until you have a diversified portfolio.

Investing in the stock market here in the Philippines has never been so easy. It’s quick to open a brokerage account and the fees are extremely low. If you have a brokerage account set up, you can start buying stocks now. If you don’t have a brokerage account set up, click the link below to open an account. It’s time to start investing!

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Don’t have a BDO Securities account?

Click here to open a BDO Securities brokerage account in as little as 5 minutes!

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For concerns, you may contact the BDO Securities Hotline at (+632) 8840-7878, Monday to Friday from 8:30AM to 5:00PM, or email us via bdosec-customercare@bdo.com.ph. BDO Securities is a PSE and PDEx Trading Participant, an SCCP and SIPF Member, and is regulated by the CMIC with website www.cmic.com.ph, and the SEC with telephone no. 0916-383-8633 and (+632) 8818-0921 and email address at msrdsubmission@sec.gov.ph.

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