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How to buy stocks in Macao 2021?

How to buy stocks in Macao – that will be the topic of today’s article.

Nothing written here should be considered formal tax, financial, legal or any other kind of advice advice, and is written for entertainment purposes only.

For any questions, or if you are looking to invest, you can contact me using  this form, or use the WhatsApp function.

We are specialists in expat-focused investments

Introduction

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How to buy stocks in Macao 2021? 3

Macao is a city and also a special administrative region of Republic of China’s people in the western delta of the Pearl River near the South China Sea. With a population of about 680,000 and an area of ​​32.9 km2 (12.7 sq mi), it is the most populous region in the world.

Macau is a former colony of the Portuguese Empire after China leased the area as a trading post in 1557. Portugal paid an annual rent and ruled over the territory under Chinese sovereignty until 1887, when it received indefinite colonial rights under the Sino-Portuguese Treaty of Beijing. 

The colony remained under Portuguese rule until 1999, when it was handed over to China. Macau is a special administrative region of China, in which there are separate systems of management and economy, different from the systems of management and economy of mainland China, according to the principle “one country, two systems”. 

The unique combination of Portuguese and Chinese architecture in the historic center of the city led to the fact that in 2005 it was inscribed on the UNESCO World Heritage List.

Originally a sparsely populated collection of coastal islands, the area has evolved into a major resort town and popular gambling destination, with a gambling industry seven times larger than Las Vegas. 

The city has one of the highest per capita incomes in the world, and its GDP per capita in purchasing power parity is one of the highest in the world; however, income inequality remains high. 

It has a very high Human Development Index calculated by the Macao government, and ranks fourth in life expectancy in the world. The area is highly urbanized; two thirds of the total land area is built on reclaimed land (land reclaimed from the sea).

Macao: Foreign Investments

According to the UNCTAD World Investment Report 2020, FDI flows to Macau in 2019 amounted to USD 1.9 billion, significantly less than USD 3.3 billion in 2018. Foreign direct investment also rose to $ 38.4 billion in 2019, mainly concentrated in the gaming and banking sectors, as well as in the tourism sector (hotel business). 

Usually the countries that make investments are Hong Kong, Cayman Islands, British Virgin Islands, Portugal and the United States. The US market is currently recovering and many infrastructure projects (new casinos, hotels, airport expansion, bridges, etc.) are underway. 

As a consequence, they must maintain an inflow of foreign direct investment, despite the negative impact of China’s anti-corruption policies. In the wake of the COVID-19 pandemic, global blockages have slowed down existing investment projects, and the outlook for a deep recession has forced multinationals to rethink new projects.

According to the latest UNCTAD Global Investment Trends Monitor, released on January 24, 2021, global foreign direct investment (FDI) flows fell 42% globally in 2020 compared to 2019. Caribbean, up to -18% in Africa. In developing countries in Asia, the decline fell to -4%. 

While developing countries in Asia as a group weathered the storm well and attracted, about $ 476 billion in FDI in 2020, flows to the Association of Southeast Asian Nations (ASEAN) member countries fell 31% to $ 107 billion due to reduction in investment. largest recipients in the sub region (UNCTAD, January 2021).

Macau’s liberal economy, free port status, political stability and strategic geographic location in the center of a dynamic area offer many attractive features to foreign investors. 

On the other hand, rising tensions between China and the United States could cause investment cuts by three American casino operators. 

Macau’s economy has long faced a dilemma between dramatic economic performance based on its casino and tourism sector and a lack of diversity in its industrial structure. 

Business activity related to gambling accounted for about 50 percent of the total industrial output of the economy in 2019. Tourism-related businesses such as hotels, retail, restaurants and entertainment accounted for another 12-15 percent. But these sectors are among the most vulnerable to the economic impact of COVID-19.

How to invest in Macao stocks?

Stocks are suitable for a variety of investment strategies and types of investors. Whether it’s the thrill of riding the waves of the market in search of quick profits or the desire to capitalize on long-term gains, stocks have a definite appeal. In any case, investing in stocks is a serious business that requires careful consideration.

Fortunately, investing in stocks has never been easier. If you are wondering how to invest in Macau stocks, we have good news for you: there are many safe and quality online brokers that offer their services to clients in Macau. Among them, you can find suppliers offering stocks from Macau, but if you want to invest in other global markets, your opportunities are even greater.

If you are ready to start, let us show you the four simple steps on how to invest in Macau stocks: 1) find an online broker; 2) open an account; 3) top up your account; 4) buy the stocks you want.

Find an online broker

As investing in a stock market became very popular, there are hundreds of brokers out there. And while some are not that much responsible operators, most are reasonably safe and of acceptable quality brokers. If you are overwhelmed by so many choices, there’s no need to worry, as we will try to show you everything in details and also give some tips.

If you would like to do your own research, we can help with that too. First, you need to make sure the broker you are looking at is available in Macau. Some brokers are only available in one country or region (for example, in the US or UK), but others operate more globally and allow clients from most countries of the world to open accounts.

Before choosing a broker, you should consider what types of stocks and markets you want to invest in. Many brokers only provide access to their home markets (be it the US, UK or India); while others offer shares from dozens of exchanges around the world. 

If you live in Macau but want to buy some popular US tech stocks or just want to build a global portfolio of stocks, make sure your broker offers trading in the stock markets you are interested in.

Security is also very important. Please note that some global brokers operate through multiple legal entities, each regulated by local authorities, for example, US clients will be controlled by the US regulator and UK clients by the UK financial authority. Some regulators also use investor protection schemes, which entitles you to compensation if your broker goes bankrupt.

Note that there are special broker finder websites with a variety of tools to quickly find your broker. It will help you narrow your choices by only showing brokers that are available in your country and are suitable for your investment goals and habits. 

Open your account

The next step is opening an account with an online broker, which is usually easy and straightforward, and it happens completely online. In most cases, you just need to provide your name, address and other basic information, and perhaps answer some questions about your wealth / income status, financial knowledge or trading experience. 

Make sure you have your documents on hand, as copies of photo ID and some recent bank statements or utility bills are usually required to verify your identity and place of residence.

Once you’ve completed registration, it usually takes another day or so to verify your account, although for some brokers, this process can take up to three days or more. 

Some locally-based brokers may even require overseas clients to send documents by mail, which complicates the process. But once your account is verified, you are ready to start investing!

Many brokers offer several types of accounts to choose from, such as individual or joint accounts or various tax-free accounts. If you are a stock investor who is saving money for retirement, check with your local tax expert to see if you are eligible for the tax-free accounts offered by your broker.

In general, don’t forget about taxes – wherever you live, selling stock at a profit or receiving annual dividends from a company you own shares is likely to have some tax implications. It is almost impossible to give you specific tax advices, but if you want to know more about the general principles of taxation when it comes to stocks and other investment vehicles, you should be aware of all the policies and have a good broker with you.

Fund your account

So, your trading account has been verified; the next step is to fund it – in other words, deposit money, which you will then use to buy stocks. Some brokers require a minimum deposit when opening an account, but most brokers do not have such a requirement, which allows you to take your time before depositing any funds.

A simple broker will advise you to deposit or withdraw funds via bank transfer; which is simple, usually free, but not always the fastest method. It can take up to three days for the money to be withdrawn to your bank account.

Many brokers also allow you to deposit (but not withdraw) funds using credit or debit cards. Some also accept so-called e-wallets such as PayPal, Apple Pay, Skrill or Neteller. 

The biggest advantage of cards and e-wallets is that transactions are instantaneous, allowing you to start investing right away or profit from a successful stock sale.

Please note that while withdrawals from your bank account are free in most cases, sometimes there are additional charges for withdrawing funds to an account with a foreign bank. 

Withdrawing funds by bank transfer (in case transfers via ACH or SEPA are not possible) can also be costly. Assess your situation and make sure you choose a broker that does not apply these costs – which can be as high as $ 45 per transaction with some brokers.

Find and buy stocks

Now that you have a brokerage account with enough money to start your investment journey, let’s finally see how to buy Macao stocks online.

You may already know which stocks you want to buy; otherwise, it’s worth checking out your broker’s research section, which often includes trading ideas and recommendations from internal experts or third-party analysts. Alternatively, you can do a little research yourself and check the earnings multiples of selected stocks or read industry news.

Once you’ve settled on a stock, it’s simple – just select it from the broker search menu, enter the number of stocks you want to buy and click Buy. When investing in stocks online, commissions are likely to be one of your biggest concerns. 

Remember also that if your broker has global market coverage, you will have to pay different fees to stocks from different countries or exchanges. For example, UK stocks may have a higher commission than US stocks, or vice versa. Often these differences are due to taxes or fees levied by exchanges, such as the 0.5% stamp duty levied by the London Stock Exchange.

Why you should invest in Macau casino stocks?

Macau casino operator stocks are skyrockets on anticipation of influx of players from mainland China.

Macau’s casino operators rallied this year, following a decision by local authorities to end the quarantine regime for visitors from all regions of mainland China. The real evidence of this is the data from the Hong Kong Stock Exchange.

In the middle of the morning trading session, the securities of Sands China (“Sands China”) soared by 10%, Galaxy (“Galaxy”) – by 11.1%, SJM (“SJ-M”) – by 8.86%, Wynn Macau (“Wynn Macau”) – up 9.38%.

According to the decision of the authorities of this special administrative region of the PRC, from Tuesday, visitors from all provinces of mainland China will be able to enter Macau without any quarantine restrictions. This does not apply to guests from nearby Hong Kong, where the epidemic situation has not completely returned to normal.

Macau’s gaming industry continues to show signs of recovery. In January 2021, Asian Las Vegas casino revenues reached $ 1 billion, the best since the start of the pandemic. According to experts, the February figure was even higher.

Macau resort operator stocks have been hit hard by the coronavirus pandemic, but they may be on the brink of a big recovery.

Investors may want to buy Las Vegas Sands (NYSE: LVS), MGM Resorts International (NYSE: MGM) or Wynn Resorts (NASDAQ: WYNN) shares while they are still down 20-40% YTD as October may be when they turn to growth again.

As the COVID-19 originated in China, gambling companies experienced its effects much earlier than many other business industries. In February, Beijing closed Macau’s one-stop resorts for two weeks. But when they reopened, even with social distancing, strict controls continued to be exercised on people traveling to and from the only place in China where gambling was permitted, and these restrictions persist today.

With tourists and gamblers unable to visit the country, gross gambling income fell more than 90% from last year for five straight months. In general, this year to August this figure has decreased by more than 82%.

It’s doubtful September numbers will be better when Macau’s Bureau of Gambling Control and Coordination updates data in two weeks, but October could be a turning point.

Advices for beginner investors

Make deals without emotion

Emotions are an investor’s worst and most dangerous enemy. Many mistakes in the stock market are caused precisely by the fact that the investor could not cope with them and misjudged the situation. If you are feeling overwhelmed or anxious, it is best to close the terminal and return to trades when you are calm and able to think clearly and openly.

Track expenses and trade less often

Work not only to increase income, but also to control expenses; without this, working in the stock market is like trying to pour water through a sieve. Minimize and optimize your expenses, don’t close deals if it doesn’t make economic sense, and make sure taxes and commissions don’t eat up the lion’s share of your profits.

Always check the information

In the Internet age, information is easier than ever before in human history. But there is also a downside – the number of fakes and false stuffing exceeds the amount of valuable and objective information. If you see information that could affect your valuation of an asset, refer to the original source and make sure the data is current, truthful, and not taken out of context.

Assess the value of your business realistically

Estimating the fair value of an asset is an important and difficult task for an investor. Try to adequately assess how market quotes reflect the real state of affairs in the company and its prospects for the future.

Have a different approach to different types of companies

If you try to evaluate all companies using the same template, you might be missing out on something important. Therefore, an individual approach to each issuer is preferable. 

Try to understand which business is behind a particular promotion. Is it a startup that is willing to take losses to grab market share, or is it a commodity cyclical company? Is it a profitable asset with limited financial performance but paying dividends, or is it a growing company that pays nothing yet but has double-digit operating profit growth over the past five years? Different types of companies are suitable for investors with different investment tactics and strategies.

Trust your own analysis, go against the trend or the opinion of the crowd more boldly

Have your own opinion and be prepared to go against fashion trends and market consensus if your analysis contradicts the general opinion. In the short term, liquidity reigns in the stock market and what the majority buys will rise, but in the long term, speculative volatility is usually overcome by fundamental factors.

Stop guessing the lows and highs of prices

If someone could reliably determine where the market quotes will be in the future, he would have taken over the world long ago. Fortunately, this is not possible. So don’t play the guessing game, put down the crystal ball and solve more pressing problems.

Filter the information flow

One of the most common mistakes a novice investor makes is to constantly monitor the flow of information, thinking that it will improve the result. Unfortunately, most news is rubbish, distracting or confusing. Learn to filter the incoming information so as not to drown in its flow and not waste valuable time.

Evaluate results over a long period of time

If you have taken any action in the stock market, do not test its effectiveness the next day, week, or month later. This is too short a period to draw objective conclusions on the basis of which tactics and strategy can be changed. Many issuers take years to realize their potential, and a drop or rise in quotes in a short period of time does not mean that you were right or wrong.

Be patient.

Patience is the first thing an investor should learn. Be prepared that your expectations will often diverge from reality. The market can be irrational for longer than the investor is solvent, so do not bet on any event in the future, risking the existing portfolio. On the other hand, do not rush to sell a good asset if its price does not rise. Too much fuss prevents long-term investors from making money on the exchange, and patience based on fundamental knowledge is often rewarded.

Pained by financial indecision? Want to invest with Adam?

Financial Planner - Adam Fayed

Adam is an internationally recognised author on financial matters, with over 266.8 million answers views on Quora.com and a widely sold book on Amazon

Further Reading

In the article below, taken directly from my online Quora answers, I spoke about the following issues and subjects:

  • What is the best advice somebody can receive before they start investing in the stock market? Should we only focus on technical knowledge, or is emotions also a vital component of investing success?
  • How are risk and return related? Or perhaps it is a myth, when we consider that some investments just give you more risk, whilst others can perform well with reasonable levels of risk? I look at all the factors, including how long you want to invest for, which will influence the risk you are taking.
  • What is the difference between very wealthy people and those who are merely wealthy?
  • What kinds of people should we associate with, and which kinds of people are best avoided? Why is who you associate with important for your future wealth, and for that matter, mental health?

To read more click on the link below.

How are risk and return related?

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