November 30, 2019
Many Malaysians do not invest in the stock market because of the perceived risk of losing money.  And it is from this position of fear that they would rather put their money in safe, or less risky, instruments, even though these assets often generate lower returns on average. Such is the case for Eugenie Devan. The kindergarten teacher, in her early 30s, concedes she is conservative when it comes to investing, and has never invested in the stock market. “I’m more inclined to park my money in something that’s safer, compared to the stock market. But of course, I know, the drawback of this is my returns won’t be as great,” Eugenie says. “I find investing in stock market to be ‘risky’ – you hear stories about people making it big on the stock market, but you also hear horror stories about people losing everything through it – so maybe, it is just not for everybody. To me, it is just too technical, and not easy to understand – so I guess I’m just not someone who’s willing to take big risks, especially with my hard-earned money,” she explains. (Source: https://www.thestar.com.my/business/business-news/2019/08/03/retail-boost)

So is the stock market for everyone?  

“Fear comes from not knowing what to expect and not feeling you have any control over what’s about to happen.  When you feel helpless, you’re far more afraid that you would be if you knew the facts,” said Chris Hadfield, the astronaut who flown two Space Shuttle missions and served as commander of the International Space Station.  Going to space is a very risky thing - a lot of things can go very wrong, and yet many like Hadfiled conquered fear and went to space. How does one overcome fear? “Risk comes from not knowing what you are doing” Warren Buffett Knowledge is the solution. So it is really not for everyone, it is for people who are willing to learn how to do it safely, in a systematic manner.  For people who are not willing, not able or not ready to learn - it is better to place their money in a very low risk instrument and be content with the lower returns on average. But this is definitely a learnable skill, if you are a working professional, executive or a business owner who has managed to get a degree from university, you are definitely able to to learn stock market investing as a skill, and we have seen that again and again in the past 11 years educating people how to do it safely and get to their financial goals faster.  

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Summary

This article addresses the common fear surrounding stock market investing, particularly among Malaysians, who often opt for lower-return, safer instruments due to perceived risks. It emphasizes that fear stems from a lack of knowledge and control, drawing parallels to overcoming fear in high-risk endeavors. The piece concludes that stock market investing is a learnable skill for those willing to acquire knowledge and invest systematically, with Beyond Insights offering educational services in this area.

Key Facts

Frequently Asked Questions

Why do many Malaysians not invest in the stock market?

Many Malaysians do not invest in the stock market because of the perceived risk of losing money and they would rather put their money in safe, or less risky, instruments, even though these assets often generate lower returns on average.

What is the drawback of choosing safer investment instruments over the stock market?

The drawback of choosing safer investment instruments is that the returns won't be as great compared to the stock market.

What is the solution to overcoming fear in stock market investing?

Knowledge is the solution to overcoming fear in stock market investing.

Who is stock market investing for?

It is for people who are willing to learn how to do it safely, in a systematic manner. For people who are not willing, not able or not ready to learn - it is better to place their money in a very low risk instrument and be content with the lower returns on average.

Related Entities

People
Eugenie Devan, Chris Hadfield, Warren Buffett, Li Chye, Kathlyn Toh
Companies
Beyond Insights, BernamaTV, The Star, SpaceX
Locations
Malaysia
Technologies
AI