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I want to know because, I too want to start investing. But I don't know the first thing about investing in stocks. How do you earn? What companies to choose? When can you withdraw your money? etc.
Any advice out there?
First bit of advice ... read. Then read some more. And read again. Read many different perspectives.
Then come to your own conclusions.
Your local library likely has an entire shelf devoted to investing advice and information. The best book I ever read about investing was a 1/2 size book and was about 50 pages long. It had 5-page chapters with maybe 1-2 charts per chapter explaining what stocks, mutual funds, ETFs, options, IRA's, 401(k)'s, and all the rest are.
Another good website I like is the Retire by 40 website. It's run by an engineer who did it - he retired just recently actually. How To Retire By 40
Wikipedia actually has good explanations on what all those are, but of course you won't have advice on there. You will find theory, but no advice.
First bit of advice ... read. Then read some more. And read again. Read many different perspectives.
Then come to your own conclusions.
Your local library likely has an entire shelf devoted to investing advice and information. The best book I ever read about investing was a 1/2 size book and was about 50 pages long. It had 5-page chapters with maybe 1-2 charts per chapter explaining what stocks, mutual funds, ETFs, options, IRA's, 401(k)'s, and all the rest are.
Another good website I like is the Retire by 40 website. It's run by an engineer who did it - he retired just recently actually. How To Retire By 40
Wikipedia actually has good explanations on what all those are, but of course you won't have advice on there. You will find theory, but no advice.
You can't go too far wrong with some stocks like Coke, JNJ and others that do not move a lot very low beta. I buy what I see as good solid stocks like Con Ed, no one in NY is going to start saying we just don't need electric anymore. It does not move a lot but it does not drop a lot either.
I'll have to look it up ... I saw it, caught my eye at the library, and I just picked it up.
I suggest doing the same ... get lost in a library and read read read.
There is no easy way. There is no 10-minute hidden secret to investing, there's nothing anyone on here will be able to tell you that will solve all your questions about it, and definitely anyone claiming to know such things is lying and/or has a hidden agenda.
That's why you have to read. It is easier than you think, but humans are not natural investors, so it's harder than ou think.
I'll have to look it up ... I saw it, caught my eye at the library, and I just picked it up.
I suggest doing the same ... get lost in a library and read read read.
There is no easy way. There is no 10-minute hidden secret to investing, there's nothing anyone on here will be able to tell you that will solve all your questions about it, and definitely anyone claiming to know such things is lying and/or has a hidden agenda.
That's why you have to read. It is easier than you think, but humans are not natural investors, so it's harder than ou think.
^^This^^. Temperament is definitely more important in investing success than IQ.
I want to know because, I too want to start investing. But I don't know the first thing about investing in stocks. How do you earn? What companies to choose? When can you withdraw your money? etc.
Any advice out there?
Since you ask kindly, I will recommend 3 books for you:
It's good to note that the stock market has a long tradition - it's been around for centuries in America alone. So, as you can imagine, much has been written, rewritten and will continue to be written about it. Be prepared for years of learning and trial and error. It's a long journey, but one that can be exhilirating. Good luck.
This is just my opinion and many will disagree. Unless you have a large sum of money to invest and hold into reliable good time, you may as well swing trade until you get a chunk of money to buy good companies at good prices. For instance, JJ, coke, are all good companies, but they are high priced.
So how much money do you have to invest in stocks, thats the first question? If its less than $5k, I would say, IMO, to save your money and wait for a market crash to get better returns.
Another idea, is to trade the futures (ES emini, Forex, sugar contracts, etc.) The margin is only $500 per contract for day trading. Which means you only need to depoist future trading account. I use Apex. The commisision is low, the capital gains is low, and the returns of profit is faster than buy and holding stocks. But this requires discipline and strategy to future contracts. But the risk vs rewards is worth it if you just have extra cash to invest. This allows me to hedge my stocks picks.
My stock picking strategy:
I been investing for 4 years. I loss some and made some money as well. I made more than I loss.
Here is my receipe:
1. Find about 50 stocks/companies with good fundamentals. Find more if you like.
2. Open a google finance portfolio and put each stock in the portfilio.
3. Every day you watch these stocks. Pull up a chart and define the support and resistance of the stocks. Draw the lines. Including the 52 week high and lows.
4. Whenever price comes to the support or 52 week high or low, you simple buy a certain amount of shares.
5. Closely monitor why the price drop to support and if price is turning back up from this support. Determine how much you will lose incase this support breaks down and price continue to fall. I stick to $300 per trade, depending on market context. Define a resistance point to sell when price reverse. Sell and take your profit. Once you up by $200 to $300 set stop loss to break even. Move on to the next stock on your list.
6. Keep up-to-dates with market news (ie, fiscall cliff, qe3, recession news. etc)
7. Sign up for Zacks daily commentary for free as a edge to keep you in the know whats going on.
8. Find a stock picking services for one year to see how professionals trust with good track records.
All in all, there millions of good companies out there to buy. What matter most if buying them at good prices. JJ can be the best stock in the world, but if you buy at the wrong price, you are starring at a loss. So timing plays a roll as well. You have to be cheap. This is why I say to find about 20-50 stocks you like and wait for price to fall and then buy. Simple as that. Wait for price to drop, determine why the price drop and make decision. There is no rush. Also, find you a service like below that provides market context and direction based on statistics so you have an edge in this game.
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