UNAIR NEWS – Easy access to information and the proliferation of education on financial planning and investment have attracted many young people to put them into practice. Noting this euphoria, Dr. Wisudanto, SE., MM, CFP, ASPM, offered several tips for beginners and students on how to start investing.

Choose the Right Investment Instrument

There are various forms and products of investment. There are investments in real estate, such as land, houses, and apartments. There are also investments through banking and capital markets. Investments through banking can take the form of deposits. Meanwhile, in the capital market, assets can be in the form of securities.

"If you want to invest in the capital market, you need to learn more, especially about the risks, whether in terms of time, returns, or assets," explained Wisudanto, a management expert from the Faculty of Economics and Business, Universitas Airlangga (FEB UNAIR).

However, if you want to invest in the capital market, the money you use should be money that you won't need in less than a year. Don't use short-term funds, such as money to pay for college.

Investing in the capital market is inherently illiquid. There's no guarantee that buying a stock today will maintain its price tomorrow.

"It's important to note that investing in the capital market is long-term, lasting more than a year and even the entire life of the company, because investing means owning a portion of the company," he explained.

Wisudanto also discourages trading practices for those who adhere to Sharia principles. This is because trading involves transactions without a clear basis and is speculative in nature. Transactions, on the other hand, must have a clear basis, both scientifically and in terms of necessity.

Understand the Product

Before deciding to purchase an investment instrument, one also needs to understand the product they intend to purchase. For example, when investing in the capital market, one must understand the company or issuer's stock before purchasing it. This includes understanding what products the company sells, where its revenue comes from, and how its business processes operate.

Especially if you want to invest in the capital market according to Sharia principles. Besides understanding the company's sources of income, it's also important to find out whether the company or issuer is registered with the Financial Services Authority (OJK)'s Sharia Securities List (DES). To avoid fraudulent investments, extensive literacy is essential.

"Don't rush into investing. Increase your literacy, understand assets and products, and attend seminars organized by relevant institutions for greater clarity," he continued.

Check the Validity of the Institution

Furthermore, it's crucial to verify the legitimacy of the institution you're investing in. Ensure the institution has the proper permits and authorizations as stipulated in the law. For example, if you want to buy land, it's best to consult a notary for assistance in verifying the legality of your land ownership. If you want to invest in the capital market, entrust it to a capital market expert like the Indonesia Stock Exchange.

"To check the validity of an institution's permit, go to the authorized agency to request guidance regarding the institution's legal aspects for investment," said Wisudanto.

Long Term Analysis

Before investing in the capital market, first analyze several factors related to the issuer whose shares you plan to purchase. There are many ratios to analyze, including return on investment (ROI) and return on equity (ROE). Simply put, ROE and ROI are the rates of return that can be earned per dollar invested in a company.

"Besides that, the most important thing when buying company shares is to consider future value," he explained.

Future value is the future value or potential of a company. For example, the stock price of a nickel trading company might currently be low, say 2,800 rupiah per share. However, due to the increasing demand for batteries for laptops, cell phones, and electric cars, a few years later, the stock price of the nickel trading company might reach 8,000 rupiah per share.

Study More, Read More

Wisudanto emphasized that the most valuable thing is time. Therefore, while you're still young, invest it for a better future. Make good use of your time by reading extensively to prepare for the future.

"Make the most of the time you have now. Your age will never come back. Study hard, read a lot, especially about God's laws, for the benefit of the people in the future. This is the most valuable investment," he concluded. (*)

Author: Galuh Mega Kurnia

Editor: Binti Q. Masruroh

Source: http://news.unair.ac.id/2021/03/31/pakar-unair-beberkan-tips-investasi-bagi-pemula/