We conducted a survey on Telegram recently to find out when you, our readers, started your investment journey.
The good news is that the majority of our readers started investing in their 20s.
That’s great to know, as it means the many within our tribe of readers have decades to compound their wealth.
Starting young has its own set of challenges.
At the start, you may have less savings to invest in the stock market.
Some may say that youngsters should focus on high growth stocks as they have the time frame to take higher risks.
But it’s a cliché to think that younger investors should just pile all their money into growth stocks as everyone’s financial situation is unique.
We feel it’s good for investors in their 20s to consider owning a mix of growth and dividend stocks depending on your own preference.
You can always tweak the proportion of growth versus income based on the amount you allocate to each stock.
Here are three companies for investors in their 20s to consider.
iFAST Corporation Limited (SGX: AIY)
iFAST is a financial technology platform that offers a wide variety of unit trusts, bonds and equities for investors.
The group has enjoyed strong growth in the past two years as the pandemic has pushed more people to invest online.
For the first half of 2021 (1H2021), revenue increased by 37.8% year on year to S$106.1 million while operating profit surged by 86.4% year on year to S$18.7 million.
Net profit soared 94% year on year to S$15.8 million.
Net client inflows stood at S$2.1 billion for 1H2021, significantly higher than the S$1.2 billion a year ago.
As a result, iFAST’s assets under administration also hit a new record high of S$17.5 billion as of 30 June 2021.
Not only does the group enjoy tailwinds for further growth, but it also pays out a quarterly dividend.
iFAST’s trailing 12-month dividend stood at S$0.0385, giving its shares a trailing dividend yield of around 0.5%.
The business has several catalysts coming up — it recently announced that it had finalised the contract for the Hong Kong pension project and that it will have a “very material” financial impact from 2023 onwards.
The group has also applied for a Malaysian digital bank licence along with a consortium of business partners.
Mapletree Industrial Trust (SGX: ME8U)
Mapletree Industrial Trust, or MIT, is an industrial REIT that owns a portfolio of industrial properties worth S$6.7 billion as of 30 June 2021.
Its portfolio comprises 114 properties across six property segments, with around 65% of its asset base in Singapore and the remainder in the US.
The REIT not only has a strong sponsor in Mapletree Investments Pte Ltd, a unit of Temasek Holdings andbut has also paid out steadily increasing dividends over the years.
Its distribution per unit (DPU) was S$0.0841 back in the fiscal year 2012 and has risen every single year since to hit S$0.1255 in the fiscal year 2021.
For MLT’s fiscal 2022 first quarter (1Q2022), DPU continued its upward climb, rising 16.7% year on year to S$0.0335.
In short, Not only does the REIT provides a stable, dependable source of passive income that can supplement a young investor’s earned income, andbut it has also shown its ability to grow its portfolio and DPU over the years.
MLT’s unit price has also increased in tandem, from S$1.10 at the beginning of January 2012 to the current S$2.90.
Alphabet (NASDAQ: GOOGL)
Alphabet, the owner of Google, has shown its ability to post stellar growth during this pandemic.
The rise in online activity across the world has benefitted the technology giant, allowing it to post a 62% year on year revenue growth for its fiscal 2021 second quarter (2Q2021) to US$61.9 billion.
Operating profit margin expanded from 17% to 31%, leading to the company’s operating profit more than doubling year on year to US$19.4 billion.
Net profit jumped from US$7 billion to US$18.5 billion, with broad-based growth seen across all of Alphabet’s divisions such as cloud, search and Youtube.
Alphabet’s stock has risen more than 260% in the last five years.
There could be more to come as the acceleration in digital adoption provides numerous catalysts for the company to continue growing both its top and bottom lines.
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Disclaimer: Royston Yang owns shares of iFAST Corporation Limited and Alphabet.