How many times have you heard the saying "no pain, no gain"? That saying rang very true for one Tonpibulsak Prapas.
The Chief Investment Officer of Ayudhya Fund Management, Prapas says he learned his fair share of lessons at the various schools he attended, but none offered him the sort of lessons that the Stock Exchange of Thailand has given him over the years.
As a teenager in Chumphon, in the Southern Province in Thailand, Prapas was like many of his friends, young and care free. When he arrived in Bangkok to begin studying finance and banking at the University of the Thai Chamber of Commerce, he found his life started to take an interesting turn.
As a senior student, Tonpibulsak started to become curious about the stock market. He started to get a few ideas together. Just two weeks before Black Monday in 1987, he borrowed money from his parents and put it all in the stock market. After the crash occurred, he kissed all the money goodbye.
"Well, if you ask how much money I lost back then, I would say the value of about 4 luxury cars" he says with a sly grin.
Though the experience was unbearably painful for a 20-year-old man, in retrospect he says it was a priceless lesson to be taught.
"I quickly realized how volatile and unstable the stock market was. I also learned how much and how deeply one needs to study [the market] to eliminate, or at least manage the risks associated with investing. That's the hardest thing one has to do," says Mr Prapas.
The personal crisis he suffered strengthened his resolve to recover all his losses. This later led him to the world of managing investments. He started to read everything in the field of investing, finding a hero in author Benjamin Graham.
After completing his bachelor's degree, Mr. Prapas pursued his MBA in finance from Wagner College in New York, where he spent most of his days in classes. He spent his nights watching financial shows and investment news on television. Most weekends he could be found at a local Barnes & Noble book store looking for securities analysis books. Before long, he had a clear plan.
"I'd like to be financially independent by the age of 60 with about 200 million Baht (approximately 5 million US dollars) in savings," he says hesitantly, then smiling.
Returning to Thailand after college, he worked as a stock analyst at Securities One for two years and another two years at One Asset Management as a fund manager.
Following the 1997 financial crisis, he headed home to help save his family's business. A few years after that, he was back in Bangkok as a financial consultant specializing in debt restructuring at several companies before working with Ayudhya Fund Management.
Asked about his view on personal finance, he says personal finance is something "...that's related to commitment and responsibilities in life, which change throughout an individual's life cycle. It's a simple matter of setting goals and executing your action plan to get there. It's the same thing as doing business."
Over time, his goals have changed with the changes in his life. Today, his ambition to be financially independent must also include the financial needs of his wife and three children as well.
For people setting a goal for savings after a retirement, he advises working back from the future to today, by taking monthly or yearly expenses, inflation and interest rates, into account.
"They need to do the math to find out how much they need to save each month or invest in order to get the dollar amount they wish to have when they retire."
Currently, 10% of his investment portfolio is in equity and fixed-income funds including long-term equity and retirement mutual funds, while the majority of 80% to 90% is in real estate.
To accomplish his goal, his portfolio needs to generate a return of at least 12% a year.
"The key, and the most important thing, is that investors need to be able to know what the risks are and manage them well," he concludes.