Investing your money, in Korea

[Daejeon]

Okay so a lot of people here "talking" about what you can and can not do without any real knowlegde or experience. #1: you do NOT need 50,000,000 won or any sort of special investor card. All you need is you ARC and any stock/investment company can open for you an account.  I suggest DAEWOO SECURITIES as they are recognized by Busan Bank, KB, and more. (meaning i can walk into KB bank and withdrawl money from my Daewoo Securities account.  It is true that more money help the investor (obviously) because the minimum investment for bonds are 30,000,000....and they yield a 15% return after a one year holding period, with virtually zero risk.

#2 Korea is one of the top 3 countries to buy stock in for 2011. Multiple sources confirm that not only is the Korea market growing at an incredible pace, it is one of the smartest investments you can make this year. Whoever keeps writing "volatile" has not done the research.  There is a great English speaking consultant working in Seoul that can help you choose the right way for you to invest money, and his English is amazing (not like when other people say "yes i speak English," and then you speak at a regular pace with them and you realize youve just waisted your breathe) but anyway, please feel free to write for advice if you need it.  I am currently in the stock market and making money (although slowly, but much better than sitting in an account at KB) and would love to give you more information. 

As with most "free advice" youll find on blogs, be wary. Many who post have no actual experience and are basically "guessing" how you might go about doing something...Investing in Korea is a brilliant decision and relatively easy to do, and the fact that your thinking beyond paycheck to paycheck is a great step in the right direction. : )

Yeah, be wary.  Be particularly wary of people giving "free advice" to steal more money from foreigners.  I've invested in several stock markets/currencies over the years, and have had consistently better returns than I would have had if I had invested in Korea/won.  I look elsewhere, and I make more money by doing so.  Political stability is a big plus, one that the ROK doesn't offer.  An unresolved, 60-year old war and politicians fighting in parliament like children on a daily basis should be a warning sign.

Crushed it, exactly

[sechje]

Wow...trying to say 15% return with zero risk is so ridiculous and quite irresponsible. It appears Shannonchristian is quite oblivious about investing and shouldn't be trying to provide advice.

THERE IS NO WAY TO GET 15%/YEAR RISK FREE. 

[sechje]

To add for those who need a simple illustration why 15%/year risk free is not possible:

Lets say someone went to the bank and borrowed some money. In this situation lets say $100,000 is borrowed with an interest rate of 10%.
They could then take this 100,000 and invest in this 15% risk free bond. At the end of the year this person would pay $10,000 interest on their loan but would make $15,000 income on their bond. So they pocketed $5,000 just like that. So why not just borrow millions and just sit on the beach while you collect the easy money!?!
This happens in fantasy land, not in the real world...





 

[rbirchtree]

First things first. Many of you guys should research finance in-depth i.e. practice financial calcuations and read books on it BEFORE investing.

The two must read book on investing, "The Intelligent Investor" by Benjamin Graham. "Your Money and Your Brain" by Jason Zweig. The must-not-read book on investing "Rich Dad, Poor Dad" by Robert Kiwoski-or-whatever

Anything by Peter Lynch is good too.

P.S.
If know how much risk you can tolerate...if you are in your twenties or thirties you can take risks in the stock market.

P.S.S.
Join the Starbucks Cat Group

[sejongthefabulous]

KOSPI (Korean stocks bench mark performance) Recent History.

YEAR         HIGH                          LOW 
2011   2231.47   27th-Apr   1644.11   26th-Sep
2010   2052.97   30th-Dec   1532.68   25th-May
2009   1723.17   23rd-Sep   992.69   3rd-Mar
2008   1901.13   19th-May   892.16   27th-Oct
2007   2085.45   1st-Nov   1345.08   10th-Jan

For those who don't understand what this kind of data means....it means Korean stocks don't perform as exceptionally as some people would like you to believe, you have to get really lucky to hit yearly highs and lows to get much over 10%.

Here is the problem with predictions:

http://www.reuters.com/article/2010/12/08/us-markets-stocks-korea-poll-idUSTRE6B734920101208

Wed Dec 8, 2010: The benchmark Korea Composite Stock Price Index was seen rising to 2,385 points by the end of 2011, up 22 percent from its Wednesday close of 1,955.72, according to the median forecast of 12 strategists whose target estimates ranged from 1,800 to 2,600 points.

Now KOSPI 1,841.75 Seems like it has gone down 6% this year so far. That is a a whopping 28% off target from the averqage what these experts assumed. This doesn't count for the fact that the won is worth less dollars than it was in December 2010.

[munybse]

From what I know, foreigners with an E-2 visa are prohibited from buying stocks in Korea. I believe only foreigners with an F-series visa (I think F-2) are allowed to buy stocks.

This isn't the case. A friend of mine has an account with Samsung on an E-2. I looked into opening one myself but went the way of IBK bank instead with a new savings account they have that earns 4.5%

[Daegu Chingu]

This may be off topic, but instead of opening a new post, maybe someone can answer me here?  I am interested in opening a Roth IRA and will probably be living in Korea for the next 3 - 5 years, if not more.  I want to open my Roth with an American company like Vanguard.  I think it can be opened online or by phone, but it seems inconvenient if I want to talk to someone in person about my finances in the future.  Do you know if there are any American companies that have offices in Korea that I can talk to someone in person? 

For those of you that already have IRAs in America, but are making Korean won, do you just send home your money monthly?  I've been hearing that KEB or NH are good for online money transfers.  How often do you send money to not incur too many fees?

Also, if people are planning on being in Korea for a while, do you think it's better to open a good savings account or CD in Korea or America?  No matter what, someday you are going to have to transfer all the money incurring fees and deal with currency exchange rates.  I heard Korean banks offer better interest rates than American banks do, which is certainly true for my bank, Wells Fargo which offers 0.05% for a money market account and what I have now at 0.01% as a standard savings account. 

[dadaclonefly]

Daegu Chingu,

In order to contribute to a Roth IRA for a calendar year, you need to have earned income in that year, and foreign-earned income which you've excluded from your American taxes does not count. So unless you've been making taxable income in the States alongside your earnings in Korea–or you've been paying American taxes on your Korean income because you never excluded it–you are ineligible to contribute to a Roth IRA.

[sordini]

I just wanted to throw out some general questions for people who are investing their money.  What are you investing in?  What do you think are good companies to look for?  What financial literature has helped you make decisions?  What are options for people earning their money in Korea? 

I'm new to Korea and plan on staying abroad (hopefully not in Korea) for a couple years so I won't be able to invest in my ROTH IRA so I'm looking for options.  I've started reading "The Intelligent Investor" by Benjamin Graham and it's been excellent so far. 

Thanks!

[lotte world]

Term deposits at a bank are paying about 4% for 12 months.

[kps1]

I just wanted to throw out some general questions for people who are investing their money.  What are you investing in?  What do you think are good companies to look for?  What financial literature has helped you make decisions?  What are options for people earning their money in Korea? 

I'm new to Korea and plan on staying abroad (hopefully not in Korea) for a couple years so I won't be able to invest in my ROTH IRA so I'm looking for options.  I've started reading "The Intelligent Investor" by Benjamin Graham and it's been excellent so far. 

Thanks!

And why, exactly, can't you invest money in your Roth IRA?

[sordini]

I just wanted to throw out some general questions for people who are investing their money.  What are you investing in?  What do you think are good companies to look for?  What financial literature has helped you make decisions?  What are options for people earning their money in Korea? 

I'm new to Korea and plan on staying abroad (hopefully not in Korea) for a couple years so I won't be able to invest in my ROTH IRA so I'm looking for options.  I've started reading "The Intelligent Investor" by Benjamin Graham and it's been excellent so far. 

Thanks!

And why, exactly, can't you invest money in your Roth IRA?

You can't contribute money to a Roth IRA if your money is excluded from taxes in the United States.  So, if I stayed in Korea for all of 2011 and it looks to the IRS like I didn't make any money, I can't contribute any of the maximum of $5,000 that is allowed because I didn't earn the money in the United States.  In order to contribute money to an IRA, you need to have earned money in that country that is at least equal to the amount you put in. 

[p33k]

Term deposits at a bank are paying about 4% for 12 months.

What he said!

[kps1]

I just wanted to throw out some general questions for people who are investing their money.  What are you investing in?  What do you think are good companies to look for?  What financial literature has helped you make decisions?  What are options for people earning their money in Korea? 

I'm new to Korea and plan on staying abroad (hopefully not in Korea) for a couple years so I won't be able to invest in my ROTH IRA so I'm looking for options.  I've started reading "The Intelligent Investor" by Benjamin Graham and it's been excellent so far. 

Thanks!

And why, exactly, can't you invest money in your Roth IRA?

You can't contribute money to a Roth IRA if your money is excluded from taxes in the United States.  So, if I stayed in Korea for all of 2011 and it looks to the IRS like I didn't make any money, I can't contribute any of the maximum of $5,000 that is allowed because I didn't earn the money in the United States.  In order to contribute money to an IRA, you need to have earned money in that country that is at least equal to the amount you put in.

Cool, I didn't know that.

[sejongthefabulous]

why not a cma account at mirae or daishin? more risk and more rewards.

[Stephensalz]

OP, do you have a stock account?  That's where I put my money, if you know how to do it there is money to be made right now.