So, I need help in the Market?

Question

What are some tips (or links) for novice investors in the stock market.

such as different types of markets, intrest rate changes, news sources, diversification plans and such

Do keep in mind, we're novices, not experts

oh yeah freedomrocks.com/ works without the numbers!!!!!!!!!!! punk. trying to sell stuff for himself. jeez the nerve

Answer 1

You should invest in stocks, bonds, and money market funds. You want to buy a diversified portfolio of stocks, as individual stocks are too risky. For most folks this means buying mutual funds. I like Vanguard.com, other people like Fidelity, TIAA-CREF, and DFA. Buy no-load, low cost funds. If you are like most people you will invest part of your money aggressively in stock funds, and part conservatively in money market funds and bond funds. Vanguard.com has an on-line questionnaire which will give you an idea how aggressive you want to be.

If your company offers a 401K plan at work, try to invest the most you can. The money grows tax free, and some companies will match your contribution. Investing in a mutual fund IRA is also a good idea.

I like index funds. Because of their broad diversification, you are less likely to have a dramatic drop in value. They also have the lowest expenses. For stock funds, I would suggest putting ~70-80% of your money in the Vanguard Total Stock Market Index Fund. and ~20-30% in a foreign stock index fund. However, there are many different opinions out there on what the best mutual funds are. Read the links below and form your own opinion

Buying a house instead of renting will save you a lot of money in the long run. You don't have to pay rent and you build equity in your house instead. Buying rental property can also be a good investment. However, being a landlord can be hard work, and many people are not good at it. If you don't know how to handle deadbeat renters, you can have trouble.

If you have high-interest debt, like credit cards, it is best to pay this off first before trying most of the investment ideas above. You should also have 3-6 months of salary saved up as an emergency fund in a bank or money market fund before trying more risky investments.

Believing advice you get on Yahoo answers can be risky, so read these websites for further information. If you find it too confusing, contact a professional financial advisor. They will charge you significant commissions, however.

Sources:

http://www.vanguard.com/VGApp/hnw/planningeducation
http://www.dallasnews.com/sharedcontent/dws/bus/scottburns/columns/2007/vitindex.html
http://www.fool.com/school.htm
http://sec.gov/investor/pubs/assetallocation.htm
https://flagship.vanguard.com/VGApp/hnw/FundsInvQuestionnaire?cbdInitTransUrl=https%3A//flagship.vanguard.com/VGApp/hnw/planningeducation/education

Answer 2

My tip to you would be to read, read, and read some more. Read the Wall Street Journal. Talk markets with people that know them, online or otherwise. Watch CNBC, Bloomberg, CNBC World, and other news programs. News sources online are great-Im sold on Bloomberg but there are a million of them-most info. is free if you know where to look. Look at charts. Eventually, as with politics, religion, sports, etc. you will hear people saying things that you might not agree with. Thats good, it means you are thinking on your own. As far as investing, start small, stay positive, and don't worry if things don't seem to go your way right away-the only way to learn is by doing!

Answer 3

Forget trying to trade "individual" stocks until you learn more about how the markets work. Trading "individual" stocks takes a lot of practice and knowledge.

Instead I suggest visiting Vanguard.com and learn how mutual funds, index funds, and exchange traded funds work. These are less risky to trade for a beginner. Listed below are some other websites for beginners.