Easy investing tips for beginners in the UAE

The best time to start investing, the old adage goes, was 20 years ago. The second-best time is now. It’s advice that holds true for stocks and other asset classes that benefit from compound interest, whether in the UAE or elsewhere. As you probably learned in school, the more time you stay invested, the higher your returns are likely to be – provided you reinvest any profits.

Yet, many UAE residents shy away from investments –they’re intimidated by financial markets, because they think they don’t know enough or don’t know where to begin, or because they believe they need to start with a specific amount. But whether it’s a fear of making the wrong decision, or analysis paralysis sparked by a surfeit of choice, there’s no reason to hold yourself back.

This article busts some popular myths and outlines a short plan to determine an investment strategy for the novice investor in the UAE. Read on to find out how you can get started.

Myth: “I need a minimum of $10,000 to begin investing.”

Truth: Not at all. With a systematic investment plan or SIP from Citibank, you can begin with as little as $100. That’s approximate equivalent of dinner for two people at a nice restaurant in the UAE.

Myth: “I need to pay down my debts first.”

Truth: This statement holds true for some debts, but not for all. You should indeed pay down high-interest debt, such as credit cards, first before making any investments. However, for lower-value loans, such as home mortgages, you may be able to make more money on the stock market than any savings you would gain from paying down the debt. What you need to do is determine the arbitrage between the rate of interest on your loan and returns from investment. If you see a higher return from investing in stocks – or even fixed deposits – than the interest rate, you may want to think about taking on more debt. But you also must factor in the chances of loss when it comes to investments. Hence, assess your appetite for risk and based on that, make your decision.

Myth: “I don’t know anything about investments.”

Truth: Everybody had to start somewhere – even some big-name investors started from nothing. If you don’t understand the basics, or didn’t learn them in school, it’s easy to get some financial help. Thanks to online tutorials on platforms such as YouTube or professionals whether individuals or through a bank; the knowledge barriers to investing in the stock market have been lowered considerably. Spend a few weeks taking online courses and expanding your knowledge through reading. Download app and start with a virtual portfolio – you have literally nothing to lose in this case.

When you maintain $200,000 or more of total relationship balance with Citi, you will get a dedicated Citigold Relationship Manager who can handhold you in every step of your investing journey. Alternatively, you can do it yourselves, buying and selling of mutual funds and other securities through Citibank Online.

Myth: “I don’t know where to begin.”

Truth: You’ve got to learn to walk before you can run. Investing is a step-by-step process, but if you don’t take those baby steps, you’re never going to be able to progress. Again, financial advice and education can help. Then explore the different investment options such as exchange-traded funds (ETFs), where you invest a small amount of money regularly over time. Consider discussing your financial management to a personal finance advisor who works for you. and is not on commission.

Myth: “I don’t trust financial advisors.”

Truth: You’re right not to trust the man who offers to sell you the Golden Gate Bridge at a discount, but not all financial advisors are frauds. Do your research before taking anyone’s advice. Ask your friends and family for recommendations. Call your bank and ask to speak to a financial advisor. Speak to a few different advisors and evaluate their advice against the standard rules: does the advisor make a commission? Are you getting the same advice from multiple sources? What is the contrarian advice? Approach investing the way you buy a car – with a lot of questions and a lot of cross-checking, ensuring you keep control of your money all the while.

Tips to get started with investing

As a first step, spend some time thinking about why you’re uncomfortable with finance. Simply writing the answers down will expose your irrational fears and help you create a plan to take action.

Then conduct an audit and evaluate your income and outgoings. See where you can cut back and put a small amount away for the future. If you’ve got high-interest loans, focus on paying those off first. Consider where you can turn an expense into an investment – one meal delivery a week could be a significant saving, for example.

Find out about investing. Read financial articles, watch instructional videos, and grow your knowledge base. As in every other area of life, it’s important to remember to continue learning – whether it’s understanding the jargon involved or reading a balance sheet.

Then, act. Download a well-reviewed app and experiment with a virtual portfolio, without putting in any money. Once you’re comfortable, speak to your bank about opening an investment account and consider putting away small amounts into an ETF, for example, regularly.

Remember, however, to steer clear of big promises, and to rein in your impatience. Make sure you understand exactly how the investment is supposed to make money, and what fees you are being charged. Don’t sign away control at any point of time. And remember that all investing involves risk, so you must consider professional advice before investing. With a little dedication and some perseverance, you could soon be on the road to growing your financial wealth.

If you found it useful, share it with family members or friends who could benefit from a disciplined approach to personal finance.


*This article is intended to provide general information about finance and investments and must not replace professional financial advice.

*Please note that this strategy does not promise any profit. You still need to ask a professional investor if you need advice/help.

*Investment products: Not a Bank deposit. Not Government insured. No Bank guarantee. May lose value.

  1. Investment products are not bank deposits or obligations or guaranteed by Citibank N.A., Citigroup Inc. or any of its affiliates or subsidiaries unless specifically stated
  2. Investment products are not insured by government or governmental agencies
  3. Investment and Treasury products are subject to Investment risk, including possible loss of principal amount invested
  4. Past performance is not indicative of future results: prices can go up or down. Investors investing in investments and/or treasury products denominated in foreign (non-local) currency should be aware of the risk of exchange rate fluctuations that may cause loss of principal when foreign currency is converted to the investors home currency. Investment and Treasury products are not available to U.S. persons
  5. All applications for investments and treasury products are subject to Terms and Conditions of the individual investment and Treasury products
  6. Citibank UAE does not provide continuous monitoring of existing customer holdings

Citibank, N.A. - UAE Branch is licensed by the Central Bank of the UAE as a branch of a foreign bank.
Citibank N.A. UAE is licensed with UAE Securities and Commodities Authority ("SCA") to undertake the financial activity as a Promoter under license number 602003.

Related articles

Dec 25, 2020 - SAVINGS
What is Financial Freedom? You have probably heard of the term "financial freedom", but what exactly does it entail? The truth is, financial freedom can mean different things for everyone. For some, financial freedom can mean having the means to pursue a passion, while for others, it may involve building a nest egg for a comfortable retirement.
Aug 27, 2020 - INVESTMENTS
Out of the many investment options available on the market, mutual funds can be a beneficial portfolio addition for investors looking to diversify their holdings. However, potential investors may not have an adequate understanding of how mutual funds work and hence, may end up passing on this investment opportunity altogether.
Keith J Fernandez is an editor and communications professional who advises on marketing content strategy. He is based between the UAE, the Netherlands and India and writes about business, technology and personal finance.

This article is intended to provide general information about finance and investments and does not replace or should be taken as professional financial advice. The content reflects the view of the author of the article and does not necessarily reflect the views of Citi or its employees, and we do not guarantee the accuracy or completeness of the information presented in the article except information on Citibank N.A. – UAE products referenced herein.
Please leave your feedback

Featured Product

Banking from the couch just got easier
You work from home, so why not skip the crowds and bank from home, too? Whether you need to pay your bills or transfer money abroad, online banking makes it easier. The UAE’s most advanced banks go even further, with account updates, payment reminders, and product offers within one convenient banking app. Put the bank in the palm of your hand today!

Citibank Terms and Conditions Apply. To view the latest terms and conditions, visit www.citibank.ae/TnC

The views expressed here are those of the authors and do not necessarily represent or reflect the views of Citibank UAE. The information in this website does not constitute investment advice or an offer to invest or to provide management services and is subject to amendment without notice.

The products and services mentioned on this page are not offered to individuals resident in the European Union, European Economic Area, Switzerland, Guernsey, Jersey, Monaco, San Marino, Vatican, The Isle of Man or the UK. The content on this page is not, and should not be construed as, an offer, invitation or solicitation to buy or sell any of the products and services mentioned herein to such individuals.

2023 citibank.ae