Small investors learn expensive lesson

Friday, May 9, 2008
Low-income groups are realising that the securities market wasn't the safest bet, as the figures continue to crash and they find themselves in debt.

"It's not only qualified, experienced people, but all of society who went crazy with the market. Lower income groups are suffering the most," said Vu Duc Nghia, vice director of Bien Viet Securities joint-stock company.

These people considered the securities market a gamble because they didn't know anything about even the basics, added Nghia.

In the mass rush to invest with promises of getting rich quickly, many people were pushed into investing. To them, joining the securities markets was like following a fashion trend, added Nghia.

Nguyen Thi Nga (not her real name), a tailor from Dong Da District learned a big lesson when she decided to take a risk by investing all of her money as well as borrowing off her friends and relatives to buy holdings.

Nga waited to sell to get more profit, but has now lost everything she had and is even in debt.

"Seeing people rush to buy, I thought I could take this chance to get rich," said Nga.

With similar ambitions Le Hung, a xe om driver, was determined to join the market simply because he believed his cousin who worked for a securities company could help him make some money.

"I gave money to my cousin to play with and hoped for the best," said Hung.

As a carpenter from the central province of Ha Tinh, Nguyen Van Tinh was barely making enough money to feed his whole family of seven.

After speaking with some friends, he figured the securities market was like gambling but with better odds. Tinh decided to sell all of his equipment, borrow money from friends and take the risk.

Now, he's looking for a way to pay back the debt.

"Now I have no equipment, I don't know what to do for money. The whole family was counting on my gamble and now they've lost their faith in me," said Tinh.

Specialised advice

To sort out this skewed image of the market, many people were pushing each other to join stock market training courses. This solution, however, proved to be a waste of time and savings as the students didn't really appreciate the long term benefits of the course.

"Low income people often want to earn money as quick as possible, so they don't take the course seriously," said Dao Lien Minh from the securities training centre under the Securities Boarding Committee.

Even when the centre offered free classes, few people were interested in joining. To them, time spent in class was time they should be spending earning money.

Recently, television stations have been pushing programmes providing securities market knowledge. Unfortunately, uninformed people often aren't interested in these programmes.

"Participants should see investing in the securities market like a business requiring information, direction and experience," said Nghia.

"Seeing the securities market as a get-rich fast scheme is a mistake that will usually end up badly for those who see it as a game," concluded Nghia. (VNS)