BusinessMagazin

Tag: investor

  • How much do you have to make to invest on the Stock Exchange?

    There are over 100,000 investors on the Bucharest Stock Exchange. Many of them are ”voucher holders” and ended up on the Stock Exchange after the mass privatisation process carried out in the late 90s, when the privatisation vouchers were turned into shares in listed companies.

    Therefore, the number of Romanians who headed for the Stock Exchange seeking a source of profit or income for the retirement years is relatively low. The main factors keeping Romanians away from the Stock Exchange are the low income and the lack of a financial education and discipline. ”One can start an investment on the Stock Exchange even with an average income of 500 euros per month. About 10% of this sum can go to the Stock Exchange. It is not a lot, but it’s a start. One should keep in mind, though, that an investor should not think that if they start out poor today and invest on the Stock Exchange, tomorrow they’ll be rich,” says Nicolae Pascu, chairman of brokerage company STK Financial.

    ”The Stock Exchange is open for anyone. Technically, there are no income barriers, but one basically needs around 500 euros in monthly income to invest on the stock exchange,” says Razvan Pasol, president of brokerage company Intercapital Invest. Perhaps even more important than the income are the savings of the future investors. More specifically, the money that investors can dispense with for at least a year or two, for which they have no plans, and, more importantly, the money they can afford to lose. This has been confirmed by the financial crisis, which led to shares falling by over 50% in certain periods. ”It matters less how much you make per month, what counts more is how much you can save. I would say 40 to 50% of the money left after all expenses are paid should go to the Stock Exchange. If the available cash amounts to less than 100,000 euros, it is rather difficult to make a stock exchange investment,” says Rares Nilas, president of BT Securities.

    TRADUCERE DE LOREDANA FRATILA-CRISTESCU SI DANIELA STOICAN







  • Before the long vacation

    The day when he had the interview with BUSINESS Magazin, Ion Soloman was sad and quite tired. He had just decided to close one of the 26 stores of the chain and after the interview he was to tell ten more employees he had to let them go. The transformation of the business he has been running for more than sixteen years is now involving more and more ”dreadful moments”. The ”most dreadful” moment is when he remembers how he turned down the offers to sell last year when several buyers, especially investment funds, showed interest in buying the 16-store chain in Bucharest.

    ”Thinking about the amount of money I could have got last year, about my peace and my family’s, I deeply regret I did not sell,” Ion Soloman is now saying, exactly one year after the most important talks he held for the sale of the Ethos retail chain, from which he backed out at the last minute. Last year, his network had funds and strategic investors wooing it, but the businessman eventually did not strike a deal with any one of them, convinced he could boost its value and sell for a higher price this year. Meanwhile, the economic crisis struck and attractive offers are nowhere to be found.

    ”Not only that no offers have come at all, but there also haven’t been any signals of such intentions,” Soloman says regretfully, admitting he would like to see proposals, if only for his pride as an entrepreneur. Some offers did come, though, only that they were not as the businessman expected them to be. ”I got two offers for financing the expansion of the chain from two investment funds, an American and an Israeli one. Large amounts were discussed, but nothing has come out of it yet.” Soloman says talks have reached a stumbling block because he would like to work with an investment fund that has a local presence, because it has more experience on the Romanian market, although its demands would be higher.

    Whereas backing out of the deal was an unfortunate idea, Soloman admits that a sale last year would not have brought him that much peace: ”On the other hand, if I had sold then I would have certainly invested in real estate and would have lost now.”