How to invest?

Question

I'm going to have extra money to put away each month. Besides an IRA or Real Estate how should I invest my money? (I don't want to be able to access it too easily, either...it doesn't have to be liquid, but I want it to be not too-high risk)
Any websites, books, info?

Answer 1

Mutual funds is an excellent way to start your investing career. After you gain experience and start to understand the lingo, then you may want to consider individual stocks. In the meantime, here's my recommended reading for this summer and maybe next summer too. Most of these books can be found in your public library.

Technical Analysis of Stock Trends by Edwards and MaGee. This is a classic.

Stock Market Logic by Norman Fosback. Another classic.

Jim Cramer's Mad Money: Watch TV, Get Rich by James J. Cramer and Cliff Mason

Real Money: Sane Investing in an Insane World by James J. Cramer

Stock Investing For Dummies by Paul Mladjenovic

How to Make Money in Stocks: A Winning System in Good Times or Bad by William J. O'Neil

The Motley Fool Investment Guide, by David and Tom Gardner

Beating the Street by Peter Lynch

7 Chart Patterns that Consistently Make Money by Ed Downs (you can get it for free at Omnitrader)

A Random Walk Down Wall Street by Burton G Malkiel

Secrets for Profiting in Bull and Bear Markets by Stan Weinstein

Stock Market Miracles by Wade B Cook

Money Game by Adam Smith

Getting Started in Options by Michael C Thomsett

The Predictors by Thomas A Bass

Answer 2

1

Answer 3

To get greater returns, you may settle for greater danger. do not initiate buying guy or woman shares. you're competing against investment specialists, and you will not win. purchase a maket index ETF like QQQ, which invests in an index and has very low expenditures. you're making an investment interior the marketplace as an entire. Or, purchase a mutual fund, and you pay a fee (a share of your cash) to the managers for choosing your shares. in case you think of which you will % the expert which will %. shares extra advantageous than all the different specialists, then purchase a mutual fund, and the extra desirable return would be nicely extremely worth the extra desirable expenditures. do not fool your self into thinking which you will %. shares extra advantageous than the specialists. If there became a intense-return, low-danger investment, the specialists could have already got jumped on it, bidding up the value till the expeected return matched the predicted danger. Open a Roth IRA. positioned funds into it. you will not get a tax deduction now, however the money will strengthen tax-unfastened, and once you're taking the money out, you will not pay tax on it. Your tax value once you retire is exceedingly much extremely going to be greater than your tax value now, so this could nicely be a stable deal. (in case you think of your tax value would be decrease in retirement, positioned your cash right into a usual IRA, which provides a deduction now, however the money is taxed as usual earnings now once you're taking it out at retirement.) positioned the money into an index ETF like QQQ. do not sell each and each time the marketplace drops. you prefer to purchase low and sell intense, and advertising whilst the marketplace drops is the different of that.

Answer 4

1. Open a 401(k) account if you can, especially if you can get an employer match.

2. Invest in a lifecycle or target date retirement fund. These funds are managed by professionals, who allocate your money into a diversified portfolio, so the risk levels are moderate. That means you don't have to do any money management yourself. Mutual funds like these are easy to invest in through payroll deduction, if that's something you'd want to do. Other types of investments, like ETFs or individual stocks and bonds, can't easily be bought through payroll deduction.

See the webpages below for more info.

Answer 5

I'm making good profit with penny stock, check here http://penny-stock.keysolve.net
Many new investors are lured to the appeal of a penny stock due to the low price and potential for rapid growth which may be as high as several hundred percent in a few days.
Similarly, severe loss can occur and many penny stocks lose all of their value in the long term.
Accordingly, the SEC warns that penny stocks are high risk investments and new investors should be aware of the risks involved but you can even make very big money. These risks include limited liquidity, lack of financial reporting, and fraud. A penny stock is a common stock that trades for less than $5 a share. While penny stocks generally are quoted over-the-counter, such as on the OTC Bulletin Board or in the Pink Sheets, they may also trade on securities exchanges, including foreign securities exchanges. In addition, penny stocks include the securities of certain private companies with no active trading market. Although a penny stock is said to be "thinly traded," share volumes traded daily can be in the hundreds of millions for a sub-penny stock. Legitimate information on penny stock companies can be difficult to find and a stock can be easily manipulated.

Answer 6

Hi. I challenge you to read up on the differences between Mutual Funds and Exchange Traded Funds. The data show that the majority of mutual funds cannot beat market returns. I would recommend simply purchasing an ETF which represents the S&P 500. VV or SPY are good choices.

If you would like to learn about investing, morningstar's investment classroom is hands down the best resource
http://www.morningstar.com/Cover/Classroom.html

Answer 7

ETFs are cheaper than mutual funds. ETFs have very low annual expenses, nearly 20 basis points or 0.2% less. As against this, actively managed mutual funds show average expenses exceeding 135 basis points (1.35%). This does not include the extra 2% - 5% as loads, 12(b)-1 marketing fees, transactions costs, and soft dollar expenses mutual funds, passed on to you but never informed, except in very fine print that nobody cares to read.

Answer 8

I recommend you start with mutual funds. Perhaps the T. Rowe Price family of no load mutual funds. They can recommend some conservative stock funds. Call their 800 number or check out their web site. Its something like troweprice.com.

Answer 9

There are 2 great sources of info to help you:

1) http://www.invest-for-retirement.com has a free book

2) Mutual Funds for Dummies, by Eric Tyson is a great starter book. This is where I started.

The good news is that you can pick a portfolio that has the amount of risk that is right for you. Your time horizon and personal risk tolerance will determine how much risk you want to expose your money to.

The basic way to adjust your risk level is by setting your stock to bond ratio in a way that is appropriate for you. In general, the further away you are from retirement, the more stocks you will hold. As you move closer to your retirement date, you will reduce your stock percentage and replace that with more bonds. Here's an excerpt from my book:

All this talk about non-correlated funds and how many to hold, it can be easy to lose sight of the most important choice in your asset allocation: the stock to bond ratio. Remember those old radios that had two tuner knobs? The big knob was for making big changes in the station tuner, moving the needle by large degrees. Then there was a small knob to fine-tune your setting once you got the needle close enough to your desired station. With your portfolio, your ratio of stocks to bonds is the big knob, determining most of the risk and gross return of the whole portfolio. The specific funds you choose (foreign, domestic, small-cap, large-cap, etc.) adjust your risk and return by only a small amount. Many investors want to overweigh their portfolio with small-cap value stocks, but have no idea what their stock to bond ratio is. They should first adjust the big knob before messing with the small knob.

Several landmark studies, summarized in these links, show just how important asset allocation is:

- http://www.nomonkeybusiness.org/articles/the90rule_or40_or100.pdf
- http://www.ifa.com/media/images/investmentpolicy.pdf
- http://www.fpanet.org/journal/articles/2006_Issues/jfp1006-art6.cfm

First, these studies show that the majority of risk in a portfolio (measured by its volatility) was determined by the stock to bond ratio. The specific funds, the individual securities within the funds, and timing of the purchases played only a minor role. Second, the studies showed that almost all of a portfolio's gross return depends on the asset allocation, most of that determined by the stock to bond ratio.

The studies also found that within funds of the same asset allocation setup, the low-cost funds beat out their high-cost counterparts. The study by Ronald Surz found that "costs were the major culprit in subtracting value" from the gross returns. Or, consider the words of Yesim Tokat, "Our results show that policy return [asset allocation] contributed more than 100 percent of actual returns, and therefore, that the contribution of active management to actual returns was negative." Also, "We find that, on average, active management reduces a portfolio's returns and increases its volatility compared with a static index implementation of the portfolio's asset allocation." In other words, active management had a negative impact for investors. But this should be old news by now. We already know that most actively-managed funds fall short of the market index by the same amount as their expenses.

Asset allocation determines the volatility and gross return of your portfolio, most of that from the stock to bond ratio. Costs then determine how much of that gross return you retain. Past performance, Morningstar ratings, manager's stock picks, and market timing yield no benefit.