How do you go about investing in Stocks????

Question

How do you buy a stock?

What are the steps and procedures needed to be done about investing in stock.

What are some of the things needed to know about stocks and investing in them?

Answer 1

My wife and I have a good system. She picks stocks based upon economic logic and fundamentals. Her criteria includes why a stock is doing well and what trends are making money. She is familiar with the products and personalities involved.

I am the technical analyst. My criteria is based upon things like P/E ratio, revenue growth over 1, 3, and 5 years, market share, profit margin, number of employees, dividends issued, moving averages, beta, and similar indicators.

Any stock that passes both of our tests usually does at least as well as the market.

60% of investment success comes from how the market does, 30% is by sector, and no more than 10% by pure stock picking.

Recently, we have moved money from stocks to bonds. Wal-Mart bonds yield better than 6% and we see no risk.

Answer 2

You had three questions, and actually the first two are one question.... buy/ steps/ procedure...log on to E-trade ( just 'cause it's one of the easiest)...fill out an application, send them a check for the amount you want to invest...when they get the check...you will be notified on-line and you will get an ID and a password for your account....you begin to construct a " portfolio" by purchasing some shares of stock or a mutual fund...once you make a buy, you will then have a portfolio in front of you... ( with stocks or ETF's, your buy is almost immediate....if you buy a mutual fund , you buy it at the price at " end of day"...it will not show up on your " portfolio" 'til the next day)
Your THIRD question is the Tough One !! Probably 50,000 books have been written about that! The ideas, thoughts, opinions are wide and varied....but it boils down to something like: try NOT to lose money...try to make the best return for the money you are investing.....the ways to do that are...be cautious...know what you are buying...find places to get your info...about stocks, companies, funds, different markets... you will have to figure out how YOU want to go about it.... moneycentral/msn has a web-site that has two things I use... they post articles from different " financial" papers and mags....you can go up and down lists of fifty diff articles for about four or five sources...'til you see an article about something you've been looking into....a certain stock...a certain country..sector news ( mining? agriculture? energy? shipping? dividends?)
Another tool there is something called " Strategy Lab"...see and read about six different investors ..their style..their picks...results..and WHY they think something might be worth investing in.
If you get some little idea that you know what to do, try this site: http://top10traders.com/
There you can buy/sell/trade in a fantasy portfolio...and see how you do BEFORE you put your hard-earned money on the line. ( ...and, again, look at the portfolios of 1600 other investors...how are they doing? how did they get there?
It's interesting, it can be quite profitable...but it takes a little work...but if you don't try it you're missing some enjoyment and some rewards.

Answer 3

I buy my stocks using ShareBuilder. They have what is known as Dividend ReInvestment Plans (DRIP). DRIPs are good because they encourage you to hold your stocks.

If you have enough money, you can open a brokerage account on a number of websites, or even at a local brokerage. Check with your bank, because they often have a brokerage they work with.

Remember, investing in stocks is risky. You can loose what you invest, so never invest more than you can loose.

As for strategies for investing, there are shelves full of books on different strategies. The one thing I will suggest is invest in things you know and use.

Answer 4

1) get a broker (suggest several of online discount (for example e trade )
2) have investment plan ( decide what risk you are OK with)
3) have money ( if < $500, don't bother)
4) pick stocks (start with analysts reports as found on broker sites, look at areas you are personally most familiar with, follow gurus with good track record)
5) Invest (fill out the brokers application send them a check or wire money from a bank and start rolling the dice)


before all this get a book on investing if you have no clue at all

Answer 5

open an account (etrade, schwab, sharebuilder) fund with some cash but as many or as few shares as you like! BUY and HOLD undervalued stocks trading for less then cash value.