AT AGE 18, you can buy alcohol, cigarettes and the lottery, and get a driving licence.

Now add playing the stock market to the list.

The Central Depository (CDP) lowered the age limit to open an account, which is needed to trade in shares here, from 21 to 18 last Monday.

This is part of the changes to the Civil Law Act, which lowered the minimum age at which most contracts are binding and enforceable to 18.

With this amendment, those aged 18 and above can register a business, become a company director and form companies or limited liability partnerships.

But is 18 an appropriate age to be investing in shares? After all, to some, it is a form of gambling.

Most of the parents and youths The New Paper on Sunday contacted felt that 21 was a more suitable age.

Sales manager Candy Tan, 44, who has a son, 15, and daughter, 17, said: 'At 18, few would have the money, except when it is provided by parents.

'To trade in stocks, you need to monitor the stock market. I don't see how they will have time for it with homework and projects to do.

'At 18, I don't think they are mature enough to manage their finances well.'

Housewife Magdalene Yew, 53, a mother of two, including an 18-year-old daughter, said: 'It's not a good thing because most 18-year-olds have to focus on their studies. They won't know the nature, history and background of the company whose stocks they are trading in.'

Mr Peter Tan, 55, a company director, noted: 'In times like these, even adults are hesitant to (invest in stocks). What more youths?'

The father of three teenage children does not invest in stocks and will not allow his children to.

The young we spoke to were also not too keen to invest in stocks.

Student Grace Lin, 19, said not every 18-year-old is mature enough to trade in shares.

Impulsive

Mr Christopher Kwok, 21, a full-time NSman, agreed: 'Though there are exceptions, most (youths) are impulsive and might end up getting bankrupt.'

But two parents were open to the idea of 18-year-olds trading in the stock market, as long as they know what they are doing.

Technical instructor Han Kee Juan, 58, a father of three, including an 18-year-old daughter, said: 'Eighteen is a good time to start learning about investments.'

He felt it was better for children to start learning at a younger age as parents can act as a safety net.

'It's like learning to walk. You need to fall a bit before you can learn to walk, but you will have parents there to guide you,' he said.

His wife, Madam Mak Lai Kam, 55, feels that parents should discuss investment issues with their children by the time they enter junior college.

The housewife, who invests in shares, said she would support her children if they were interested in shares trading.

'I would give them money to invest with a cap of $10,000, but not in speculative counters, only shares for long-term investment,' she said.

'But they must have some basic knowledge first. At the beginning, I will also discuss with them what to buy.'

Some parents and financial experts believe that allowing the young to invest in shares may improve their financial knowledge.

Although Madam Tan does not approve of youths trading at 18, she said it would be useful for JC students to gain investment knowledge.

Investor education

Securities Investors Association of Singapore (SIAS) president David Gerald also emphasised the need for investor education among young people.

'Investing without investor education is gambling. They need to have the knowledge first,' he said. 'They must be taught investment principles to be long-term investors and not get into speculative play.'

Mr Leong Sze Hian, president of the Society of Financial Service Professionals, said that while the move may help young people to be responsible for their actions at a younger age, they may not be ready.

'In Singapore, there's little financial education in schools,' he said.

'For people to be investing at 18, it's like a lopsided equation. They are not making money yet. If they are earning money, they will know how important it is to be prudent with it.

'If they don't care, they could just be investing for fun, and see it like a game.'

He suggested providing an optional financial literacy course for those who want to invest in shares.

When contacted, a CDP spokesman said: 'The CDP is supportive of the Government's broader efforts for an entrepreneurial society. The CDP has aligned its current practices to the amendments in the Civil Law Act.'

Investors can learn about investing in the stock market by going for courses conducted by SIAS, member firms and the Singapore Exchange, the spokesman added.

Additional reporting by Audrey Tan, newsroom intern

This article was first published in The New Paper.