Recent Posts
* Best financial stocks to buy now
* Best Stock ideas for 2011
* Managed Futures ETF – What is it and how to trade?
* Top Stock trading Apps for Iphone and Android
* Best Investments for young people 2011 or young professionals
Categories
* 2011 Investing
* 401k
* 403b
* 529
* Banking and Finance
* Bankruptcy
* Biotech Industry
* Bonds Basics
* Companies
* Copper Industry
* Day Trading
* Debt Market
* Dividend Investing
* Earnings
* ETF
* ETF India
* Forex Trading Systems
* Frugal Living and Saving Money
* Futures and Options
* Gold
* Insurance
* IRA
* Lifestyle
* Metals Industry
* Mutua Funds USA
* Mutual Fund Terminology
* Mutual Funds India
* Oil & Gas Industry
* Oil Industry
* Real Estate
* Saving Accounts
* Stock Advice
* Stock market Canada
* Stock Market Today
* Stock markets India
* Stock Terminology
* Stock Tips
* Stocks Carnival
* Taxes
* Technology
* Telecom Industry
* Trading Strategies
* Uncategorized
* Uranium Industry
* US Stock Market Index
Stock Tips For Beginning Investors
January 19, 2011 by John Border | Comments: 0
Investing in the stock market can look as difficult as rocket science in Greek. With numbers and names flying around, terms you don’t understand, horror stories of people who were unsuccessful, this can be understandable. But this is not necessarily the case. Here are some stock tips which can help make the process simple, and with a little understanding and study, you can be on your way to being a successful investor within no time.
1. What is investing in the stock market? What terms and definitions are there?
Purchasing stock means that you are buying a small portion of the company. Depending on the type of stock you purchase, you may also have voting rights, and can attend company meetings. There are two types of market movements; Bear-ish and Bull-ish. A bear market is where the prices are dropping. A bull market is where the prices are rising. There are lots of stock specific trading terms, and it would behoove you to study up on these. The alphabets on each stock represent the name of the company; MCD is McDonalds, BAC is Bank of America Corp. etc.
2. Easy Ways To Invest
Many people are choosing the comfort of their home or office to make their investments on through the internet. Here are a few tips for online investing.
I. Online trading isn’t instant. Even though bank transfers can be conducted within seconds; your purchase still needs to go through a broker (person or team of people who do the actual buying and selling). In this time; prices may change.
II. There are several ‘markets’ through which your broker can choose to make the purchase or sale from. The broker will pick the one that is best for the majority of investors, such as the NYSE (New York Stock Exchange), or through a third party, or even through the company itself. Some websites offer the option to direct specifically which exchange to go through, although this may cost extra.
III. A helpful stock market tip may be to place ‘limit orders’ rather than market orders. Limit orders are directions to buy and sell at a certain price. This can ensure that purchases are made effectively despite market changes, which can change drastically from second to second.
IV. Review any and all policies that are issued by the company you have signed up with, including privacy policy, as well as liability issues.
3. Day Traders and Horror Stories.
You probably remember the dismal black and white pictures of the Great Depression from your history book, and still feel the effects of the recent 2008 financial crises. You may have heard of the term day trader, and wonder what it means.
Day traders are traders who buy and sell immediately, buying at the latest buzz, and selling at the first panic. This method is typically employed by amateurs, get-rich quick hopefuls, and was, according to some experts, one of the reasons for the Crash of ’29. Day Trading is not illegal, or unethical, however, it is risky. If you are planning to make serious and solid money, selling immediately is not the key. Experts advise to hold on to your stocks for long term dividends. What this amounts to is taking an active interest in the welfare of the company whose stock you hold. Over longer periods of time, this can mean higher gains both for you and the company.
4. Portfolios, Which Stocks to Invest.
A portfolio consists of all the stocks that you currently hold and have invested in. Finding the best stocks to invest in depends on recent market trends and other factors. Some good businesses to look into include American Express, the Bank of America, McDonalds, and Reynolds American. These are large businesses which provide good returns, and are relatively stable or growing companies.
Remember to spread your investments. This is one of the major keys to successful investing. Create a diverse portfolio with both low-risk investments as well as a few moderate or high risk investments which will give you a better chance at minimizing your losses in case of an unexpected twist.
5. Other investments
Low risk investments are usually along the lines of Mutual funds and Government bonds. These take time to ‘mature’ (become bankable), however they are not very risky, and can provide a safe retirement fund. Other investing includes trading in raw commodities, such as Tobacco, spices and other raw materials. Investing in Gold and Silver has been very popular, and is recommended by several experts as either a separate investment; or as something solid to go hand in hand with your other investments.
6. Scams and Legal Issues
There are several sites and online entities which copy certificates, have fake verification phone numbers in an effort to scam individuals and groups. Here are some ways to avoid a potential rip off from happening to you. There are several websites which can be used to verify registered traders; such as http://www.iosco.org/ for Canadian and Mexican regulators and http://www.nasaa.org/home/index.cfm for the US. You can also take further steps to verify the sites authenticity, including your State Security Regulatory. Similar to the mails sent out about winning thousands of dollars in lotteries, it is safe to assume that if the offer sounds too good to be real, it sadly usually is.
In summary, investing in the stock market can be a great way to make some extra income, and is now being offered from the comfort of home. Remember that sales are not always instantaneous when conducted online; always check to make sure that any canceled orders have indeed been cancelled. Do research about the stock you are buying, and take an active interest in the stock; buy and sell responsibly. Be sure to also investigate in the website you are enrolling with, and review all policies relevant. Investing doesn’t mean an overnight fortune, but with appropriate planning, smart research and the resources of a good online research team; you can find that investing in stocks can be a great source of extra money, or even your primary source of income.
