Direct Investing is kicking off Investor Education Month in October with a focus on those new to investing. Anthony Okolie speaks with Nugwa Haruna, Client Education Instructor, TD Direct Investing, about how to gain confidence and knowledge to get started.
- For some Gen Z and millennials, investing in financial markets can be intimidating, especially if they are completely new to trading. Nugwa, as a millennial yourself, you've lived this experience. Tell me about it.
- So a few years ago, some stocks in a specific industry were trading at historically high levels, and you could not go into the lunchroom without hearing your colleagues talk about how great their investments were going. And this really piqued my interest. So in order to avoid experiencing the fear of missing out, I decided to go ahead, open a self-directed investing account. After doing this, I actually funded my account, proceeded to invest in some stocks, and I was up 20% within a few days.
So now I'm thinking I'm some kind of investment guru. And I went ahead and put some more money in my account, bought some more stocks based on a quick Google search. But then things that didn't turn out my way. I actually proceeded to lose a significant portion of my original investment. And this scared me off the markets for a while.
So fast-forward a few years. I actually came across TD Direct Investing educational offerings, which are free. And this actually changed my perspective when it came to investing. So I discovered webinars, which are on-demand videos where we have different industry experts come and talk about a wide variety of investment topics. I also discovered master classes, which are live interactive sessions where you are able to interact with an instructor, ask questions, get those questions answered in real time. And all of these changed my perspective when it came to investing.
So I realized there's no one size fits all when it comes to investing. I can practice a more passive or active investing strategy. And I know I'm not going to quit my day job and become a day trader, and that's OK.
- OK. So what's a good way for new investors to overcome that fear of their first trade?
- It was actually discovering there were a wide variety of investment options at my disposal than I actually originally knew about. So for instance, if I wanted to practice a strategy that was more about earning income while preserving my original investment, I could consider using fixed-income investments. So I could use things like Guaranteed Investment Certificates, also known as GICs, or bonds because these tend to pay interest-- be it monthly, quarterly, or annually-- based on my preference. Or I could actually consider using dividend-paying stock, keeping in mind that companies can cancel their dividends at any time.
On the other hand, if I was more interested in the growth of my portfolio, I could utilize stocks. I would also want to know that historically there have been corrections and dips in the stock market, but also historically the stock market has had the highest returns when you compare them to cash or fixed income investments.
Now, finally, if I was not interested or I just didn't have the time to pick out individual investments myself, I could consider using mutual funds or exchange-traded funds. And in this case, a professional money manager has put together different investments based on an investment objective. I could find the right fund based on my risk tolerance and my financial goal, but I also want to keep in mind there might be a management fee.
So for myself, discovering the webinars, masterclasses, video lessons available in the Learning Center on WebBroker changed my perspective of investing. It made me more comfortable when it came to investing. And I became more confident as a self-directed investor.
So for anyone else, they are able to utilize this information. They can decide to transition to more part-time or full-time self-directed investing, or they can have more meaningful conversations with their financial planner or investment advisor about their portfolio.
- And how important is it for Gen Z and millennials to be able to trade on their phone?
- We have our mobile device constantly on us. And we can tell you where these devices are and we never leave home without it. So for that reason if I wanted to keep track of the markets, place a quick trade-- and it's not even just about trading, if I wanted to squeeze in a short educational information session-- I can access all of this on my mobile device.
So using the TD mobile app, I'm able to actually access the Learn to Invest tab. And when I get in there, I can find short videos as well as different investment courses. They can keep me up to date with the markets. And it's a really convenient way to learn.
- And of course, in October, DI is celebrating its Investor Education Month with a focus on millennial investors. What can attendees expect to hear?
- We have four webinars coming up that will cover a wide variety of investment knowledge. So we do have guest speakers who are coming. So for instance, we're covering topics such as the new investor survival checklist-- something I could have used when I first started off investing. We also have topics such as overcoming FOMO-- or the Fear Of Missing Out-- as a millennial investor.
We're also offering live interactive masterclasses, which are going to cover a wide knowledge base for different investors. For instance, on Mondays and Fridays at 4:00 PM we will be offering these live sessions for investors or prospective investors who are curious about what TD Direct Investing has to offer when it comes to investment accounts, investment products and services, the educational offerings we have, as well as the trading platforms. So anyone who is interested can actually check out these and more events by going to td.com/iem to see our calendar of events.
- Nugwa, thanks very much for your time. And I look forward to talking to you again next month about DI's Investor Education month.