how can a 14year old invest in stocks?

Question

i have about $700.00 how can i invest it?

Answer 1

i think your parents should do that for u

Answer 2

Well, there's a couple of ways to go. You can pick a good mutual fund and just add to it as you go. That's probably the smartest thing to do because you get instant diversification (meaning you'll effectively own a whole pool of different stocks, which improves your odds of success and lessens the odds of loss). For that small an amount, a mutual fund makes sense.

But if you'd really like to hand pick your stocks, check out http://www.sharebuilder.com. They are the only broker that lets you buy into fractional shares of stocks. For example, you can buy say $20 of IBM, instead of having to buy a whole share which is roughly at about $75 at this point. Plus they keep the fees very low.

One of the problems with smaller investment dollars is that trading fees will make a HUGE dent. Places like Schwab are going to charge $30 for each buy and sell. Losing $60 off $700 sets you at a huge loss before you can even break even, let alone make a profit.

That's one other reason a mutual fund makes a good choice. There are several companies that offer low minimum purchases that do not charge a sales load or fee. http://www.troweprice.com is one of the few no loads with a low minimum and decent funds.

The important part here is that you do some homework first. It would make sense to go get a good beginning investing book so you can learn how to choose the right stocks. Picking stocks can be very time consuming if you wish to do a good job. Again funds are less work, but you still have to pick the right fund. Usually a beginner starts with a fund that holds large cap (big companies) stocks.

You can walk it into a brokerage firm, but you'll have to pay a commission and quite frankly learning how to do it yourself is fun.

You will need one of your parents to be custodian of the account because you're under 18.

Also you need to know that in a custodial account, short term trading, options and other high risk investment choices are ILLEGAL. There's something called "prudent man rule" that applies that is meant to keep kids from losing all their money. so if your hope was to get rich quick, note that you can't do that legally. That's actually a good thing because most amateurs that try short term trading lose much of their money.

Have fun...and starting young is the best way to eventually end up very, very wealthy.

Answer 3

I was once 14 years old, and soon I started thinking of investing.

You never should use every last dollar you have for any type of investing.

You should sit down and map out a plan.

Every good investment plan works when you invest at small increments.

For working people, that is usually when they add money to their pension accounts so that one day they can retire and hopefully live off of what they saved when they were working.

You have a long way to go, so start slowly and gradually.

Learn all that you can about good corporations like Microsoft or McDonalds.

And when you feel that you are ready, then make a small purchase of some stock in one of these good companies and watch what it does...learn from what it does.

Life is a learning promise and I applaud you for wanting to learn at your young age.

Also, remeber what the Chinese people say...A journey of 100 miles starts with the first step.

Take that step and don't look back. Learn from it. Think always that you are a success. And above all..

Best of Luck!

Answer 4

Have your parents buy it for you. If your parents are thinking of buying a stock that you like, ask them if you could piggyback on top. Investing $700 by youself is not a good idea, since the transaction costs would be very high compared to the principal amount. Discuss with your parents, see what they are thinking of buying.

I don't think you can open your own account, stock or mutual fund.

Answer 5

skrew the financial advisors. You can buy stock by direct investing in companys like Disney, Heinz, Ford, AT&T, Walmart, XMSatellitite, and many more by using UTMA accounts under your SS# on the application.
(Universal Transfer to Minor Accounts) . You can not cash/sell it until you are 18 or 21 though. You can let the dividends re-invest and then pay the taxes when you sell.

go for it.

Answer 6

Ask your parents to make a meeting for you with a financial advisor or find out through your school whether there is a stock trading club or group. As you have no experience, I do not advise you to buy stocks at this time. The market is very volatile and a lot of money is being lost.

Answer 7

i dont think u can.... at 14 i mean u can invest in other ways... but stocks i dont think u can but u can open an account on like www.ameritrade.com with your parents info... and u can buy and sell stocks but it will be under your parents name... but of course ask them before you do this.... and if u do do this when your 18 u can get the stocks placed from their account to your account... but when i signed up about 3 years ago ameritrade had a $500 min and i think it went up to $1500 but they recently joined with another company so i dont know how much u need to start but good luck!!!!!!!

Answer 8

First off let me say congradulations on taking the first step in wanting to start investing...

I would recommend something like this if you had $700.00 to start investing:

Open up anaccount at www.sharebuilder.com with $200.00... to by stocks... in opening up and account there you should get a $25.00 bonus after your first trade... Stick with blue chip companies that pay a dividend...makes little sense too buy stock that don't pay you to buy there stock.

Second I would open up an account at www.ing.com with $250.00... now with that you can divide your account into subaccounts that you can use for specific purpases....but first thing there is to set up a safty net account.... money that you will have sitting in there that you can use if needed to pay for something with out tapping your investments...also with opening an account there with the $250.00 you should recive a bonus of $25.00.

And last with the remaining $250.00 go to Edward Jones or nearest investment place of your choice and have them open up a Roth IRA for you... chose something like American Funds with have a minimum investment of $250.00 to start...

Following something similar to this will give you a ballanced starting plan for investting... Remember that if you make future contributions regualrly and try not too skip or delay...

Rule of thumb: Pay yourself before you pay someone else.

You can also log on to sites like www.smartmoney.com for research into things as well....

Best of luck and happy investing...

When I started investing I had $500.00 to start with, I invested that into something like I outlined here for you, and when I got my first job I took a minimum of 10% of my gross pay and invested it...and now I am sitting on an account vallued at around $16,000.00

With you being 14 years old you may need your parents too help you set up the accounts but it shouldn't be much of a problem.

Answer 9

ask your parents or a financial advisor