Can someone explain a few things about the stock market to me?

Question

I have semi-knowledge of it from asking people, but there are still things I'm not entirely sure of. First, how old do you have to be to start stock investing? Whether it be alone, or with adult permission, please specify. Also, I sorta know how it works, but can someone also give me a breif overview again just so I know I'm right?

Also, is there any site I can go to where I can use pretend money on a pretend stock server to see first-hand without the risk of how it works?

Thanks.

Answer 1

When you own a stock, you own a part of the company. A very very small part, but still a part. As an owner, you share in the profits, which are called dividends. If the company does well, people see that and they're willing to pay more for the stock, so it goes up. If they think it will do well, they still bid the stock up.

You can get your parents to help you buy stocks through a stock brokerage account for a minor. Any brokerage will set it up. They can also buy the first share for you and you can buy more through Dividend Reinvestment Plans.

If you look up The Rule of 72, you'll see that the best way to make money is to invest early and keep investing. Congratulations, at your age, just buy starting early, you can be on your way to becoming a millionaire!

Answer 2

You will need a stock broker - someone who buys and sells commodities on your behalf. Read newspapers like the Times / Guardian to see which commodities and shares are doing well. The stock market works on the basic economic theory of supply and demand. If demand for something is high, more people will buy and the price goes up. If demand is low, the price will drop in order to start selling again. Commodities such as gold and successful companies will normally always increase in value. If you work, ask the company if they have a share scheme. You will usually be offered a reduced rate (like £30 pounds worth for £20) and its a good a place to start as any. Best of luck.

Answer 3

I think the best way to learn about the stock market is to first see what the best traders are buying and selling and why. This is the idea behind the site http://www.top10traders.com - this is a free site that lets you create a portfolio of stocks with $100,000 in "play" money. Each day the site ranks the best performing portfolios, so you can see how your picks perform compared to other investors. You can also read posts on investing from the best traders, as well as share your own investing ideas. There is also a charting feature , so you can see how your portfolio performs compared to the S&P 500.

Here are this month's best traders:

http://www.top10traders.com/Top10Standings.aspx

I would also suggest the great short book "The Little Book That Beats The Market".

Good luck.

Answer 4

It is possible for a minor to own stocks ( I did. ) You will have problems selling them as a minor, and will probably need an adult to open an account with one of the trading firms.

The listed price for trades is applicable for a "lot" of shares - 100 or more. There is an additional fee for an "odd-lot" There are market orders and limit orders. A market order is to buy at whatever the current price is. A limit order executes only if the price reaches your threshold. If you place your price too low on a limit order, you will not necessarily actually purchase the stock, since it was never available at that price.

Welcome to the wonderful world of investing! Remember to factor in your trading costs, frequent trading destroys returns on your investments.

Answer 5

The age to have your own brokerage acct is 18, but you could have a parent or relative open an acct in your name w them as the guardian of the acct.

Another good site to "play" is investopedia.com , you get $100,000 in your acct to invest as you see fit.

Investing for your future plans is a GREAT thing for you to be doing, & the stock market is fun, interesting, & can be very profitable.......it is also very dangerous for someone who isn't well informed, or using money they may need soon for other purposes.

There are many different strategies for choosing the right stock & how long to keep it, etc. There is not one correct answer...many approaches have been equally successful. Have fun!!

Answer 6

You can start investing when your born. As long as you have a documentable income you can start a ROTH IRA. You may need a custodian to open the account however.

Answer 7

18 in most cases and here are soem starter sites for you to enjoy.

http://www.hsx.com (hollywood stock exchange free and FUN!)

http://www.marketocracy.com nice site good challenge too

Answer 8

As soon as you are born you can trade stocks. I am sure you have hear the term "Trust Fund Baby"

Answer 9

www.virtualstockexchange.com is free, not bad