how do i get into buying stocks?

Question

any info would be great

Answer 1

Investing in "individual" stocks takes a lot of knowledge and practice; so I would not suggest doing this until you understand completely how the stock markets work.

Instead visit Vanguard.com and learn about mutual funds, index funds, and exchange-traded-funds (ETFs). Trading funds is less risky than trying to trade "individual" stocks.

Unless you plan on spending everyday of your life looking at stock charts trying to determine the best time to get in and out of "individual" stocks, I would look into some sort of fund.

Also be very careful about asking for stock tips online. Most are probably worthless or contain unethical motives. Do not fall for any Pump-and-Dump scams.

As far as books go, I actually started out with the Investing for Dummies books, and they definitely pushed me in the right direction. To many other books have their own agendas in my opinion.

The websites below all contain plenty of FREE information to get you started in the right direction.

Answer 2

Learn before you place money into the market.

For mutual funds:

1) Mutual Funds for Dummies, by Eric Tyson
2) http://www.invest-for-retirement.com for a free book in PDF format
3) The Boglehead's Guide to Investing

For info about stocks:

1) Morningstar's "The Five Rules for Successful Stock Investing", by Pat Dorsey
2) A Random Walk Down Wall Street, by Burton Malkiel
3) All about Stocks, by Esme Faerber

Any of those should get your pointed in the right direction.

Answer 3

Take some time to set up an online account. You can do this for a small amount of money, usually 100-200. Go to some of the sites such as www.motleyfool.com and watch cnbc and other cable channels talking about stocks. Another great site to go to would be www.mn1.com There you will be able to listen to people who have been in the market for many years.

Do your homework on companies before you invest. Read up on how to properly disseminate a balance sheet, cash flow, and profit and loss statement. This is the key to finding profitable, yet undervalued companies to invest in.

Answer 4

When you're investing in stocks (or in anything,) you should ask yourself "What's my reason for investing this money?" If you're investing for a short-term goal, like something (college, car, house, whatever) less than 3 years in the future, you're probably going to do better sticking your cash in a high-interest savings account or a money-market account, rather than individual stocks. You can get those at lots of places (try searching for "savings account" and see all the places happy to pay you 5% or better on your money.)

If you've thought about this and you're sure you want to invest in stocks, figure out what you want to buy. Stocks are supposed to be a long-term investment, so you're going to want to pick companies which are going to increase in value over (at least) the next 5-10 years. Check out sites like the Motley Fool (fool.com) and Morningstar (morningstar.com) for research into which industrial sectors, and which stocks within those sectors, have positive outlooks for the future. Everybody's got their own "secret formula," but some good general advice is to look for companies that have a history of being increasingly profitable (their reported earnings are going up.) You can get basic financial stats (earnings, stock analyst ratings, etc.) on finance.yahoo.com. You're going to run into a lot of financial jargon -- if you run into a term that you're unfamiliar with, my favorite site for definitions is investorwords.com. Don't be intimidated; that's why I like fool.com -- they have discussion boards and a "fool's school" section explaining the basics.

Once you've done some research, picked out your Morningstar 5-star rated stocks or whatever, and you're ready to buy, don't assume that you have to go through a stock brokerage. Many companies offer a direct stock purchase plan, where you buy stock through the company's transfer agent. Check out the company's corporate website -- they usually have a section called "investor relations" or "stockholder information" which will tell you if they have a "direct investment plan" or a "dividend reinvestment plan" and how to sign up if they do. 9 times out of 10, that's cheaper than buying the stock through a brokerage firm. (That said, make sure you read the small print about fees and such.) If your favorite stock doesn't have a direct registration plan, shop around for a cheap brokerage firm. (You've probably heard of a few, they advertise everywhere -- TDAmeritrade, E*Trade, etc. I can't say I recommend one over the other.)

OR, you could open a less-cheap brokerage account and get a financial advisor to tell you what stocks to buy. You don't have to spend all your time researching, but you're basically paying someone else to do that for you. It can be really costly if you don't watch out. Another way people end up spending money instead of spending time is by buying a mutual fund -- it's the same idea as paying a financial advisor; you're buying shares of a fund and trusting that the fund's manager will buy the right stocks.

One final word: remember all that research you did? Don't forget why you bought a particular stock in the first place. One good tip is to write down your reasoning (e.g. "I think this company has a good product and everyone will want to buy it" or "I think the new CEO will be able to cut the company's costs and make it much more profitable") and review your reasons every so often (every month, or every three months -- do it too often and you'll either get bored and forget, or you'll pay too much attention to short-term price movements in what's supposed to be a long-term investment.) Keep up-to-date on news about your stock. DON'T sell in a panic, but DO sell if you're SURE that your reasoning was wrong.

Best of luck!

Answer 5

First you need to choose a broker. You can choose an online broker like firsttrade.com or scottrade.com, or go to your local bank. Once you pick your broker, you open an account with them and put money in the account. then you can buy whatever security (stock, mutual fund, bond) you like. Some securities, other than stocks, have minimum investment amounts you will have to buy. In order to know what to buy, you need to do research. A book called "getting started in stocks" is a great resource. or you can enlist a broker to handle everything, but this is generally pretty expensive. That's all to it. you need to be willing to do a lot of research or research some mutual funds you think yo u can trust with your money. Online brokerages are cheaper than a bank or some more established brokerages.

Answer 6

I see you are interested in investing in the stock markets. Start trading stocks is as simple as opening a trading account with no minimum investment amount and then picking a stock for as low as $100 and then buy. However, that simplicity is truly the wolf beneath the sheep's skin.

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://worden.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.


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/


In conclusion, what I am saying here is that trading stocks and investing for profit is a professional game that takes years and a lot of money to learn, so it is not something that someone in need of college fees should do ... now.... but you should certainly start to learn about it right now.

Hope these information helps.


http://www.optiontradingpedia.com/

http://www.mastersoequity.com/

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Answer 7

I've been short on a company since early May. The price has gradually come down and I still like the short position I hold

Answer 8

The stock market eats people and money to keep itself alive. Most of the people involved have years of schooling and experience and still they get burned once in awhile. If you don't know the market don't dabble. If you have to play it get a professional to guide you. I know a lot of people that have lost everything in the market don't you become one of them!