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Originally from Egypt, Aladdin Abdulkareem moved to the UAE in 2008 in search of a higher salary, experience and opportunities.
Mr Abdulkareem, 42, studied civil engineering and now works as a resident engineer for an international consultancy in Dubai.
However, his annual income in portfolio management is increasing thanks to a partnership with global electronic trading platform Interactive Brokers.
Mr Abdulkarim manages a “medium-sized fund” for friends and family. He lives in Amar South, Dubai, with his wife and four-year-old twin children.
What was your first job? What’s the salary?
I graduated in 2003 and spent almost five years in Egypt.
My first job was as an engineer in Egypt in 2004 and the salary was very low, no more than $100 a month at the time. I tried to gradually increase my income.
However, when I got the opportunity in the UAE, the salary was five times what I would have made in Egypt. The Bay Area needs engineers.
So I decided to move here in 2008 to gain more experience. Not just for better income.
I am a field engineer for a contracting company, earning a monthly salary of AED 5,000 (USD 1,361).
When should you start earning side income?
I have always been passionate about starting new businesses to make side income. So, I started saving money and started a contracting company. But it was not successful.
Then, I saved money and started a farm in Ajman in 2015. However, I realized that one must do research on expenses and income before starting a business.
I had to raise a lot of money and spent more than I raised. Business was not good and it closed after a year.
At the same time, I was working on my passion for portfolio management and stock trading, which really interested me.
I believe a person needs at least three sources of income. Now, I make money from different sources: I work a 9-to-5 job as a consultant and do portfolio management by running a small fund for friends and family.
I got into portfolio management in 2021.
How did you learn to trade stocks?
I learned to trade stocks in 2011 because it is my passion. My first experience was with currency trading and Forex trading.
Gradually, I read books and learned about stock trading from the Internet, which exposed me to the world of corporate finance and financial management.
I want to consolidate my knowledge through academics. So, I started taking certifications and in 2020 I joined the Corporate Finance Institute in Canada. Online courses have increased my financial knowledge.
Later, I wanted to pursue an MBA in finance and studied at the University of Illinois Gies Business School. I’m halfway through my course.
I believe learning is a never-ending process. I even hope to pursue a PhD one day.
Do you have any other side hustles?
In 2023, I published a book and sold it on Amazon. So, I get some income from that.
The title of my book is From Newbie to Investor: Your 10-Day Guide to Stock Investing.
I also have a financial blog called Cash Wishes that focuses on financial freedom and personal finance.
It’s still in the initial stages and I plan to monetize it gradually. Maintaining a blog requires discipline and consistency.
I don’t recommend that people start many things at the same time.
What does your portfolio management job involve?
I help people invest their savings. I act as their advisor, deciding which stocks to buy and which stocks to sell.
I am responsible for the growth of their portfolio. My goal is to grow my annual income by about 25%.
I currently manage a medium-sized fund for friends and family.
How do you invest your time in doing this?
Since I’m a long-term investor/portfolio manager, I don’t need to sit in front of a screen to buy and sell stocks. I don’t like day trading.
I read about companies, earnings, and revenue. I follow the masters in this field: Warren Buffett, Mohnish Pabrai, and Peter Lim. I learn from their writing and books.
I check the portfolios I manage two to three times a week.
How much money do you make from portfolio management?
I typically charge an annual fee of 5% of the total portfolio size. But it’s not a fixed fee, it depends on the performance of my clients’ portfolios.
I earn around AED 80,000 per year through portfolio management. I hope to one day earn most of my income from portfolio management, say 90%.
I plan to increase this income to AED 300,000 in the next few years.
Currently, my main source of income is my 9 to 5 job.
Do you save and in which asset classes do you invest?
I save aggressively every month and invest that money. I save about 50% of my monthly salary.
I invest in stocks for the long term. I diversify my stock investments into clean energy, pharmaceuticals, technology, and semiconductor ETFs.
I currently earn a very high income from semiconductor stocks. However, the situation is not always positive.
I also own stocks in companies like Apple and Ford.
I have 60% of my portfolio allocated to ETFs, 20% to individual companies, and 7% to 10% in cash to look for new opportunities.
How often do you rebalance your portfolio?
I review my portfolio every month. If some balance is needed, I’ll do it.
Have you ever purchased a property in the UAE or elsewhere?
I have two properties in Egypt; one is rented and the other is not. They have paid in full.
I rent a property in Dubai. I tried to buy a house here but it was expensive. Once the price drops, I won’t have enough cash.
I don’t like mortgages.
Do you have debt?
I have no debt, except for a credit card debt of about AED 3,000 per month, which I have paid off in full. I only use credit cards to get points, cash back programs, and other offers.
This aversion to debt can be traced to an event before the pandemic.
In 2019, I opened a food kiosk called Ougi Franks in a mall in Dubai. But I had to close it in 2020 because I couldn’t afford the losses due to the Covid-19 shutdown.
I took out a personal loan to start this business and it was a very bad experience. I ended up paying off the loan with my salary.
From that day on, I decided not to owe any more debt.
![Aladdin Abdulkarim believes that a person needs at least three sources of income.Leslie Pableo for The Nation](https://thenational-the-national-prod.cdn.arcpublishing.com/resizer/zHwbFRERWWloh5S9CdUZtRiWv6k=/800x0/filters:format(jpg):quality(70)/cloudfront-eu-central-1.images.arcpublishing.com/thenational/S674UQHEPNELFNA2TKM65K2CYY.jpg)
Have you inherited any money?
No, I’ve made all my money so far and it’s self-funded.
Growing up, were you taught how to handle your finances?
We learn by watching our parents. I come from a middle-class family in Egypt. My father is an accountant and my mother is unemployed.
We are taught to manage our expenses and are given a certain amount of money every week to meet our requirements in school and college.
We are taught not to spend the entire amount at once and ask for more.
My siblings and I receive money on occasions like Eid and we plan how to spend it so we never run out of money.
What are your major monthly expenses?
Most of them make money by renting houses. Since my children are still young, I expect that next year’s expenses will mainly come from education.
Now, my monthly expenses total between AED 7,000 and AED 8,000. I saved the rest of my money.
I adhere to the “pay yourself first” principle.I came from a book called The richest man in Babylon.
Do you have an emergency fund?
My emergency fund is safe in my portfolio because I am a long-term investor.
I consider the portion of my portfolio that I keep in cash as my emergency fund.
However, it’s not something that’s in my bank checking account, it’s something that’s in my portfolio account.
Have you started saving for retirement?
I will never retire because I do what I love.
Maybe in the future, I will quit my 9-to-5 job. I look forward to becoming financially independent in a few years.
But I would still be a fund manager or a non-executive board member of a listed company.
My short term goals, say within two years, are to quit my 9 to 5 job and expand my portfolio management
Aladdin Abdul Karim
What do you do with your disposable income?
I spend my money on home entertainment. I allocate Dh1,000 to Dh1,500 per month for this.
Have you ever worried about money?
No, I’m not worried about money right now. But between 2009 and 2010, before I was financially literate, I was worried.
Money is not a goal, but a tool that gets you from one point to another. Once you learn how to use this car, you won’t have any financial worries anymore.
Problems arise when you don’t understand how to drive the car.
If you know how to handle your spending, be in the right place at the right time and take advantage of opportunities, the money will follow.
As I read more, got certified, and started working on my MBA, I became more comfortable with money.
I don’t make money every day through portfolio management, but I feel like I can handle it.
Do you have passive income?
I got it from my book and hopefully from the blog soon.
I also earn dividends from companies in my portfolio.
What strategies do you use to offset inflation?
Don’t keep money in banks or lockers. It will weaken the value by at least 3%.
I hedge against price increases by buying shares of companies with strategies to combat inflation.
What are your financial goals?
My short term goal, say in two years, is to quit my 9 to 5 job and expand my portfolio management.
My long-term goal, say within ten years, is to be on the board of directors of at least two public companies.
What is your view on financial freedom?
This is a stage where you have no worries and have your own time.
I expect to be financially independent within two years.
Would you like to be featured in My Paycheck, a weekly column that explores how people around the world manage their income?write to pf@thenationalnews.com share your story
Updated: February 13, 2024 6:21 am
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