Considering investing in stocks

[Wolfnox]

Right now looking at pros and cons. Could use advise.

 

[Shamar]

Right now looking at pros and cons. Could use advise.

True story. Some years ago they did an experiment where experienced stock and financial analysts picked stocks, compared to a chimpanzee picking stocks. The chimp did better. Need I say more?

 

[Misery]

True story. Some years ago they did an experiment where experienced stock and financial analysts picked stocks, compared to a chimpanzee picking stocks. The chimp did better. Need I say more?

So, dont throw darts with a blindfold on- er, I mean, dont buy stocks.

Got it.

 

[GadAbout]

How much money do you have to invest? Often you will need several thousand just to get started.

The stock market always goes up, in the long run; the problem is people try to play it in the short run, or they don't have sufficient liquid assets to cover an emergency, and may have to sell when the market's down.

If you put some money into a well managed stock index mutual fund, preferably with no fees, and then LEAVE IT THERE A LONG TIME, you should do well. Try Fidelity.com for an investment firm.

 

[puzzlingbill]

How much money do you have to invest? Often you will need several thousand just to get started.

The stock market always goes up, in the long run; the problem is people try to play it in the short run, or they don't have sufficient liquid assets to cover an emergency, and may have to sell when the market's down.

If you put some money into a well managed stock index mutual fund, preferably with no fees, and then LEAVE IT THERE A LONG TIME, you should do well. Try Fidelity.com for an investment firm.

I'll second that - I was about to post something similar. If you have the impression you can trade from your PC and get rich ... you can't. You can't beat the guys on Wall Street on a regular basis. Much better for a beginner is to put your money in a fund that is managed by one of those guys on Wall Street.

And, as was mentioned, you need to treat the money like it's been put away for awhile. I had some IBM stock that cost $1200 in 1970. I sold it in the mid-90's for $35,000. The key is being patient.

 

[SolarPoweredNightOwl]

Do your research. I recommend dividend stocks (stocks that pay shareholders a portion of the company's profit every so often), so you can get passive income. Don't think you'll get rich quick, think of long term investing. Stocks are massively overpriced right now, we're long overdue for a market correction (read: crash). Do like Warren Buffett, make sure you have plenty of cash on hand, and snap up quality stocks for cheap during the market downturn.

 

[Judge]

Timing is everything. Wait until the next recession to buy quality stocks at undervalued prices. The market has been overbought for some time. No point in getting into the market only to pay more than a stock is worth.

And if you aren't sufficiently capitalized, don't bother. It really does take money to make money. You don't want to be in the market for peanuts where risk always outpaces rewards.

I'm glad to have gotten out when I did. Spent some nine years in the market, from 2009 to 2018.

A shorter answer? - Don't. Trading equities isn't for just anyone. I used to underwrite business finances and solvency for insurance purposes, so analyzing various market metrics and key business ratios weren't all that difficult to me.

Though just knowing the basics in this regard is only part of the equation, especially with consideration to a global economy with so much turmoil happening on every continent. Where doing proper research can potentially become a full-time job. If anything, bide your time and wait for the economy to take a dump.

 

[unperson]

I could use some investing advice too, used to just put it in a term deposit, but with interest rates so low, looking for something else.

 

[NothingToSeeHere]

I recommend an Index Fund, low fee, low risk, low effort, and as others have said the stock market always goes up in the long term. However only do it if you are in the long term i.e. at least 10 years, preferably much longer. Short term investment in stocks is stupid as your money is just as likely to reduce as increase. Invest while the market is low (if you have the chance, you may in the near future! Recessions are great for first time investors!) or spread your investments out over a period of time (such as investing a few £100 a week for a few months) to reduce the impact of market changes.

If you are in the US (??) I have heard good things about Betterment.

 

[Bolletje]

I read that you were considering investing in socks. I’m not opposed to the idea.

 

[Judge]

I read that you were considering investing in socks. I’m not opposed to the idea.

Point taken. Nothing like an investment that leaves you all warm and fuzzy.

 

[Bolletje]

Point taken. Nothing like an investment that leaves you all warm and fuzzy.

Plus pretty much everyone wears socks!

 

[Kirsty]

They are speaking about stocks; not socks.

 

[SolarPoweredNightOwl]

If you find a good clothing manufacturer, you could always buy stocks in socks.

 

[Graphin]

I didn't trade stocks for 30 years, but:
Several global (important) businesses may have stocks more stable than national currencies.
With inflation, your savings lose value, but with stocks you often ride on the wave of inflation and general economic growth.
This is at least true in the larger picture on average.

 

[Progster]

Stock values rise and fall in five year cycles, so it's often a good long term investment, but short short term investment.

 

[Johann]

Right now looking at pros and cons. Could use advise.

My suggestion would be to learn as much about money as possible within reason while living a frugal life. Then worry about traditional investing. In all honesty, it is often best to invest extra income into yourself as a way to get a higher paying position or enter a new field that pays more if you are looking for just an increase in $.

There are various asset classes you can invest in other than stocks. These financial instruments include bonds, commodities, real estate, commercial paper, etc. Stocks are just one option. You will learn these financial instruments are bought on primary and secondary markets and are issued by financial institutions. Continuing from smaller to larger systems, you will find that these investments live in a larger macroeconomic context. But...you asked about stocks...

Stocks are financial assets(opposed to a real asset) that represent your investment in a company. You in a sense buy a portion of the company with the hope that the company becomes more profitable. So, you should understand general business ideas, the specific industry/sector the business is in, the actual business you are investing in, its competitors, and the larger environmental forces(social, political, cultural, etc) it lives in. Of course there are other philosophies and trading theories like:

Technical Analysis
Portfolio Theory
Macro Fundamental Analysis
blah blah


Basically (active-which means you are picking your own stocks) stock trading is a full time job..most people put their money into the largest companies and hope they dont fail(passive trading)..or put them into ETF's(indexing/passive trading) and bet the market/segment/etc., doesnt fail.

If you have to start somewhere, start researching the companies who products and services you like.

If you want to learn more about business or finance specifically, you can visit http://www.quickmba.com. It covers some of the overarching ideas in an MBA program.

This youtube page will cover business/investments/money and banking/financial institutions/etc:
Krassimir Petrov (these video lectures are taken from real business courses and the book used in the course is provided in the first video of each course)

 

[serebrina]

Your profit will depend on the shares and companies and the amount invested. Investments in stocks were profitable. But you understand that these should be shares of developing and popular companies. The amount of investment will not be $100. If, for example, to invest in Apple shares then so it makes sense. 1. Sales are growing. 2. Apple has by far the coolest development of Swift vs Objective-C . 3. The company constantly surprises its users.