 |
Investment Tips For The Beginner
by Miriam Amiro
http://www.fclinvestment.com
When investors first formed the stock market, stocks were
traded and quickly grew to incredible profits. With every
trade, more investors joined in this enterprise until stock
market trading became a less risky adventure. Well, not
really. Stocks are still as unpredictable as when the
market was first formed. But, today, we have a slightly
better understanding of how this market behaves. Before
starting to invest in stocks, you should carefully examine
this market to pick up trends and other warning signals.
While the origins of the stock market were not nearly as
neatly planned as God's creation of the universe, the stock
market was able to survive a turbulent and often very risky
beginning. Many new investors to the stock market today
often feel the same way when they want to enter the big and
exciting world of stocks. Yes, the stock market still
carries many risks. Nevertheless, at the same time, the
careful investor can learn to identify warning signs and get
better at venturing into risks as the days progress.
On "Day One", most investors just want to know a safe way to
invest as little as possible in stocks and still get a
decent return. Before you can light up your portfolio, you
need to do some research about which stocks work best for
your goals. For instance, are you looking for a long or
short-term investment? Do you have $500 or over $20,000?
Most beginner stock investors start with long-term
investments. Long-term investments usually last longer than
five years and involve volatile holding stocks or stock
mutual funds that profit well over time. You don't need
thousands of dollars to begin; many online brokers allow you
to invest in long-term stocks with $500 or less. Some of
these same brokers also permit you to make monthly payments
of $25 or $50 by automatic withdrawal from a checking
account.
Short-term stocks are less risky investments but still not
guaranteed to profit as well as long-term investments. Most
of these short-term investments come in a package with low
to medium volatile stocks that are quickly sold in under a
year. Some investors use these short-term stocks like
mutual funds to stash away long-term funds that will be soon
used for covering other expenses like a child's higher
education costs.
The stock market never perfectly operates as you might
expect. While many investors have great plans of holding
stocks for exactly ten years, the market doesn't always
function according to plans. Following general rules about
the stock market does help in an investor know when to make
a move; however, expecting the market to be exactly on your
schedule sometimes leads to unnecessary panic or wrong bets.
Some general rules that help you decide when to hold or sell
involve simple math. For instance, the price-earning ratio
(when the price which you paid for the stock is less than
the current market price) is one way to tell if you should
sell for a profit.
Sometimes an investor just has to ride with the tide.
Deciding when to sell or buy a stock isn't as easy as it
sounds; hence, many new investors decide to purchase and
sell their stocks through online brokers such as
Ameritrade.com and E*Trade. Joining an investment club is
another way to feel better about your trades and a place to
discuss stock performances. If you plan to trade a large
sum of money, you should consult a big investment firm like
Charles Schwab to handle your investments in a highly
attentive way. Lots of information about starting in the
stock investment world are available online at places like
Yahoo!Finance or WallStreet.com.
Submit An Article
|
|  |
