Best Investment?

Question

Newbie here to the investment world. I just had a simple question to kinda get me started on the right track ..and I was hoping people that have invested in stocks before could give me thier best insight and opinion on what they would do . My question is simply this . If you have 5grand to invest and bascially wanted to pull out in 6mos to a year , where would the best place to put it in terms of comming out ahead.... thanks in advance for your answers *smile*

Answer 1

newbie,
U need to decide what risk you want to take before attempting to come up with an investment strategy. With regard to stocks there are some aspects u should bear in mind, these are important points which most uneducated investors fail to grasp. there are 2 ways a stock price moves (1) new information coming available and (2) irrational behavior. Assuming that the fund managers with access to the largest funds have perfect information (valid assumption given empircal evidence) the price can only justifiably move when new info comes available i.e. profit, economic data etc. People who have a hunch about a stock can drive a share price too through fads (eg dot com companies). Now the informed fund managers (if they are good) will realise when irrational strategy is pushing up a price and act on that inflating it further but eventually exiting to make a profit. My advice to you is shop around for mutual funds until u have the basic principles comprehended. Also there are some exciting capital guaranteed investments out there that give u access to different stock markets. Speak to a professional

Answer 2

Be very, very careful!!! I have made a lot and lost a lot. Do not invest in anything that someone tells you is a great deal. Do your own homework and invest in a company that you think will do well. Historically, December is always a good month to invest because there is a phenomenon known as the Christmas rally, where all the stockbrokers try and make their year end portfolios look positive and drive the prices of stocks up. But yes, they come back down in January. Your 6 month time frmae is considered 'short term', so again, be very careful. Study the Dow Jones 30 industrial stock averages, as these are the companies that are least likely to go bankrupt. Disney is on this list and is currently a highly rated stock, up over 30% last year. There are also what are called "index" stocks, one in particular is called a SPYDER, which is a stock made up of the top 500 companies on the NASDAQ exchange. This is also a safe place to put your money. The irony is, the safer the investment, the less the potential return on investment. The greater the risk, the greater the reward. Can you afford to lose the $5k? then take a big risk. Can you not afford to lose it? Then perhaps a short term T-Bill or certificate of deposit. Do your homework!

Answer 3

Good luck with your investments--better make your own money that rely on social security later on!

Unless you are looking for high risk, investment strategies should be considered long-term. A six to twelve month approach is not a best fit--consider a CD instead. Although it's not 10%+ return, 5% gets you $250 on your 5-grand in a year.

Answer 4

SPY is S&P500 ETF, or go with a no load mutual fund. U can research and pick a stock for urself.

Answer 5

Money Market = works like a bank account.
CD's = you have various time frame to invest.
Check with your bank, they will give you different options.

Answer 6

open a sharebuilder.com account and buy VTI and then forget about it till you are ready to retire.