what stock should i invest in and why?

Question

i ve never invested in any thing before im not sure how to do it please help

Answer 1

Your question reveals the fact that you are a complete newbie with very weak basic, fundamental knowledge in the stock markets and is about to do something you might regret for a very long time.

Listening to free, off the street advice is an EXPRESSWAY to DISASTER. Read more good books and articles on investments to expand your vision and horizon before you decide to go deeper into the subject. For some of the best investment books that I have ever read, please visit http://www.bestoptiontradingbooks.com

Investing or trading the stock markets never start from asking how to buy a certain stock ... it starts from adequate investment and trading knowledge. There are quite a number of things you need to learn before you can even start thinking of the stock markets ...

1. You need to understand how the stock market works and what it is exactly about.

2. You need to know what are the different styles of trading in stocks and shares.

3. You need to read about why so many people lose their shirts in the stock markets so that you can avoid their mistakes and also decide if this is a risk you want to take.

For all these issues and more, you can read about them from some of the articles that I wrote at http://www.mastersoequity.com/articles.htm

After you are adequately armed with the basic concepts and ideas, you need to know how to find profitable stocks to trade or invest in. You can do that the easy way by subscribing to stock pick services (example http://www.stockpickmaster.com ) or you can learn to use charting tools and softwares to find stocks with parameters that you can pre-define. (example http://www.worden.com )

All in all, investment and trading is a lifelong education and non stop learning. No one is ever done learning and catching up with changes in the markets.

If you care to read about how I went from completely broke to retired millionaire trading stocks and options by 28 years old, you can go to http://www.mastersoequity.com/

Remember, the slogan "Just Do It", Just won't do for the stock markets. If profiting in the stock markets is as simple as buying a single stock , then why are so many people still poor?

After you have all the above mentioned knowledge, you need to ask the following golden questions before you can decide whether a stock is worth buying or not :

1. Why are you of the opinion that this stock will rise?

2. Is your opinion valid in the first place?

3. When are you expecting it to rise? Can you hold on for that period of time or longer?

4. What is your expected entry price? After what price would your expected profit margin be too thin to enter upon?

5. Where is your expected stop loss point? What is your stop loss point based on? Where will you tell yourself that it is time to take a loss and get out?

6. Where is your expected profit taking point? What is your profit taking point based on?

7. Does the way you are buying the stock allow you to hold on until your expected profit taking point?

8. How much of your money should you dedicate to this one trade?

9. What is the level of primary, secondary and idiosyncratic risk you are undertaking when deciding how much of your fund to use?

10. What is your cashflow need? Does your cashflow needs allow you to hold the full lifetime of the stock?

After you are able to answer all these questions confidently, THEN you are ready to... PAPER TRADE your stock strategy. Yes, even at this point, you are NOT READY to trade for real. You should trade on PAPER for at least 6 months and become consistently successful BEFORE you take your stock strategy into real life.

Then.. you are ready to start... but there is still no guarantee of success as paper trading is very different from real trading. You will need another maybe 1 year or 2 trading very little money and be consistently successful BEFORE you are ready to increase your stakes.


So, as you can see, success in the stock markets is not easy at all the the less knowledge you have, the more risk you undertake. I lost hundreds of thousands in the stock markets before I become successful.

Take heed and good luck.




http://www.mastersoequity.com

http://www.optiontradingpedia.com




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Answer 2

If you are asking that question in this forum, you are obviously a naive investor. You should avoid buying individual stocks and put your money in a no-load mutual fund.

The fact is that if anyone knew of a stock that was undervalued, they would buy it & that would bid up the price, making it less likely to be undervalued for later investors.

Academic studies show that new information gets imbedded in prices almost immediately. This means that if someone tells you here that there is good news for a company, then that good news is already priced in.

The only way to beat the market on a regular basis is to have private information. There are three ways to get private information. One is to have insider information (which is usually illegal to use in trading). One way is to pay for it -- taking away the advantage. The third way is to gather up all public information on your own & glean information from it -- leading you to realize the private information that causes the public information. In other words -- use fundamental analysis. Since there are other people doing this analysis on big firms -- the payoff isn't going to be high, since they will probably get the information before you.

All of this means that profits can be made in smaller firms where no analyst is covering the company. You can be the first to learn what the public information means. Unfortunately, doing this involves a skill and knowledge that most people don't possess. And it is certainly a knowledge that you aren't going to learn asking here.

No load mutual funds are your best bet.

Answer 3

I like the homebuilders.

For Homebuilders across the country, 2006 could be viewed as the year the housing bubble finally released some hot air. Similar to the 2000 dotcom bubble, these homebuilder stocks have dropped 50% or more from their all time highs. While the media loves to report on how terrible the housing market is, I believed this is the best opportunity for investors. In some parts of California, new homes that were once selling for 400K is now having hard time moving at 340K. Despite incentives such as free upgrades and cash back, buyers are not willing to commit.

Answer 4

This is the worst place to ask this question. Spend a year reading on investing. Understand "asset allocation". Never (ever) use stock tips. Always understand what you're investing in.

Answer 5

Check out http://www.smartmoney.com and review some recommendations from there. You should pay special attention to their Stock Screener tool which has some preloaded search criteria that helps narrow down the thousands of stocks to a few good picks.

Answer 6

Invest in India, its hot right now, good momemtum and strong growth. Here are two internet picks for Indai: REDF and SIFY. Go to etrade.com and sign up for an account. Make your despoit per the web site's instructions. within a few days you will be ready to go.

Answer 7

There used to be a research performed with monkeys, kindergardners and inventory agents. kindergardners picked the shares they knew: Disney, toys'r'us, and so forth. Stock agents did it their approach. Ststistics, and so forth. And the monkeys picked shares by way of throwing darts at a wall.. lengthy tale quick.... inventory agents got here in final. monkeys moment, and kindergardners got here in first... Pick shares you realize of and purchase merchandise from.

Answer 8

You could start with the New York Stock Exchange. (NYSE:NYX)