Educating the masses on the benefits of stocks investment
FINANCE professors are generally skeptical about whether or not students really understand them when they teach about stocks investment, particularly the benefits derived from it by those who are actually participating in the trading market.
Teachers recognize the difficulty in creating an investing spirit among students especially when using highfalutin yet significant financial and technical terms such as “stock valuation” and “movement of stock prices” which to the latter are theories and formulas that simply need to be learned in class in order to pass the subject.
Skepticism towards stocks investment is common in the academic world. Among the faculty of Finance, for instance, only a few have actually seen a trading floor, have owned a stock certificate, or have seen a stock broker in the flesh. Even among graduates and professionals, only a handful would eventually engage in investing.
Data indeed reveal that only small a number of Filipinos are into stocks investment, with less than 1% of the Philippine population investing in the stock market, as compared to Singapore at 32.6%, Japan at 25%, Malaysia at 17.9%, Hong Kong at 17.5%, and Korea at 10.1%.
It is a little known fact that a group in the Philippines propagates the discipline in stocks investment with the primary mission to educate Filipinos on the so-called capital market. Capital Market Institute of the Philippines (CMIP), that came into being seven years ago is chaired by Professor Rey Nograles, a former Fund Manager who was responsible for the enormous growth of the GSIS funds. With support from the Philippine Stock Exchange, CMIP is providing free trainings nationwide to faculties of finance.
Last week, CMIP concluded its 7th run of the Capital Market Investment Teaching Accreditation Program (CMITAP) participated in by 23 selected mentors from different colleges and universities in Luzon and the Visayas. The training aimed to equip the faculty with actual techniques in investment decisions, and included topics that hoped to widen the perspectives of the participants in reading economic indicators and, most importantly, in transforming and increasing the pessimism of the participants towards stocks investment.
The rigid five-day program included topics on fundamental and technical analyses, risk and portfolio management, valuation of stocks, good governance, ethics, and regulatory laws. After the training, a comprehensive examination was administered in which a participant must pass in order to be conferred the Capital Market Teaching Accreditation Certificate.
The 7th CMITAP culminated with a formal ceremony right at the trading floor of the Philippine Stock Exchange with its president, Mr. Hans Sicat, as guest of honor. Sicat personally conferred the accreditation certificates to the participants. The top there participants, who were chosen based on the results of the comprehensive examination, were Alvon Ramos of St. Louie University in Tuguegarao (valedictorian), and the second and third placers were faculty of the Lyceum of the Philippines in Batangas and Enverga University in Lucena, respectively.
THE CMIP belied the notion that stocks investment is purely a gamble. Even at times when the economy is not bullish, an investor could still realize earnings if he is adept at the necessary techniques and has developed a trusting relationship with brokers. To alleviate poverty and foster economic development in the country, CMIP aims to increase the consciousness of Filipinos on the benefits of stocks investment and their appetite for earning extra money other than their regular sources of income.
It believes that the educators are their best partners to realize this. There are immediate plans for CMIP to lobby at the DepEd the inclusion of the subject in the basic education curriculum so that the discipline would be instilled in the consciousness of the masses and would eventually become part of their daily lives.
Indeed, the sector of finance educators should be trained to educate the real value of investing in the capital market. By making themselves actual investors, more and more people would be convinced of the value of stocks investment and the benefits it would accrue to the economy.