EXPLAINER: What is the Philippine stock market really?

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Here's a rundown on how the Philippine stock market works, and how you can start investing.

Consider this: from January 2010 to January 2022, the stock market rose in value by almost 150%, or an annual return of 12.44%. That means if you invested P100,000 in January 2010, you would have nearly P250,000 after 12 years, essentially just by waiting. Keep in mind too that this includes the huge swings caused by the pandemic. Without that, you might have earned even more.

The stock market is actually made up of many parts, as opposed to being one central platform. In advanced economies like the United States, the stock market is made up of different stock exchanges, each with their own set of stocks for trading. These stock exchanges serve as the organized “place” where people buy and sell stocks.

On the other hand, ABC Company could “go public,” or have their shares listed in the stock market. This opens up the company to investments from the general public, who can then buy their shares. Still, not every publicly-listed company declares dividends. Even for those that do, there’s often no assurance of regular declarations.

 

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