Which stock should I invest in with only 5,000 dolars?

Question

I have saved 5000 dollars in the past two years and I am a college student. I have refused to buy expensive clothing and I rarely go out. I am trying to save money because I basically support myself by working in a retail store which does not pay very much. I need a stock, or stocks that I can invest in to make my money grow because I want to have a secure future without counting on mommy or daddy. I can't seem to find a decent job that pays atleast 30,000 dollars a year. Someone gimme a solution

Answer 1

Its important to hold a diversified portfolio of stocks - not just hope for one winner. Stock markets have an expected return that pays higher then cash to offset the riskiness of the market. This premium assumes you hold a diversified portfolio of stocks. If you hold one or two stocks, you are taking on additional risk, but there's no expected benefit.

$5000 isn't enough for you to buy individual stocks and achieve diversification. I'd suggest you buy two mutual funds, given your age: A US equity fund, and an international fund. You can research and choose what you like, but since you have a frugal nature, I think you might like a passive fund. These funds attempt to generate the market return at the lowest cost possible. The average mutual fund that attempts to beat the market does - but not by enough to cover its higher costs. Vanguard is a well known provider of passive funds in the US, you could look into others as well.

As for your job prospects, I don't know what you're studying in college, that certainly would have a big impact.

Answer 2

Yes, the stock market is risky but there are some stocks that are
stronger and safer. You can get good gains on a stock but be careful. Listen to advise but also do your own research. Do some reading and look on yahoo.com-finance. I recommend ebay. It is a strong company, growing and making billions of dollars. You might have to wait a few years but you might double your money. They have had stock splits and will probably have another one. Get an online broker, the commision is a lot cheaper. $5,000 is a good amount to invest. Of course, nobody knows for sure about the stock market but ebay is so big, strong and successful, I sincerely doubt that you would lose money if you hold on to it for at least one year. You can diversify if you know 5 good stocks and put a little less than $1,000. on each because of comission. It is safest to do value investing- buy a strong company at a low price. Ebay is lower than usual, if you look at the graph on yahoo finance.

Answer 3

Invest in 1 or 2 good mutual funds. Do some research and find out what has good a good projection for the next 10 years or so. That's not enough money to safely invest in single stocks unless you dont care if you loose it, and you have a very good knowledge of investing. By the fact that you are asking the question, I would stay afay from single stocks with that amount.

Answer 4

If you are going to buy individual stocks get a scottrade account as it will literal save you over a hundred dollars a trade than when you go with a regular broker. Second mutual funds are more safe than individual stocks. i suggest something like going to a place like A.G. Edwards and asking there advise as I have made money via their suggestions.

But if you are resolute on individual stocks i would buy oil in about a weeks time or so. People are freaking out that the oil prices are dropping and will over sell their positions. I personally like a company called Strata oil (SOIGF) which I have made up to 400%. Wait till it hits 4.5 to 4 dollars a share. I'm willing to bet it will go back up to 8 dollars in less than a years time.

Now there are no guarantees in the stock market and it is a little bit like gambling. Be as educated and diverse as you can be and chances are you will do OK.

Best of wishes on your new investment venture.

Answer 5

if I were you I'd forget about the stock market - too risky, look for a really good interest rate. ING has 4,35 on a savings account and I have seen some banks with 5% on CDs. It's a sure way to make money and not lost your hard earned savings.

Answer 6

Oil companies or companies in the Defense Industry.

Examples:

Mobil
Shell
Lockheed Martin
Northrop Grumman
General Dynamics

Answer 7

My advice is that if you don't have much investment experience, invest in a name brand mutual fund. With a mutual fund, you get an array of investments to make it lower risk. For more financial advice. check out my website at http://www.easymoneyadvice.com
Thanks
Cory