Stock Markets Exposed - I am totally new to stock investing and I need to start how can I satrt?

I am totally new to stock investing and I need to start how can I satrt?

Public Comments

lucky guesses. type in random names in etrade and pick one you fell that is going to go up
if your time horizon is 5 years, and have $500 spare money, check EZM, buy and hold. A true winner.
Try no load mutual funds, or an online account like Sharebuilder. If you are unsure about stocks, stick with things you are familiar with, Coke, Walmart, Nike, Home Depot, etc..
If you want to invest in stocks, open an account with a discount brokerage firm like Scottrade. You want low fees! You can read the investment columns for stock picks, but individual stocks are the riskiest form of investment. For a beginner, I recommend stock Mutual funds. They pick the stocks, buy and sell for you. Use a No load fund! Foreign funds, especially Latin American have been hot, as well as precious metal funds. Check on funds rating through Morning Star or Schwab online. You can find what the typical return is vs, the risk. If you want to start small, try penny stocks!
Wow. Some incredibly terrible advice so far. Buy a no-load fund because they're free? Would you go to a barber that gave out free haircuts? How about a doctor who gave free colonoscopies? Just because they're FREE doesn't necessarily mean they're any GOOD. Loads (commissions) work like this: If you're going to someone for advice, you're going to compensate them for their time and expertise. If you're going to do all your own research, and put in the time, then by all means, consider no-load funds--if and only if they meet your particular objectives. And if you ARE going to go it on your own, make sure you have the tools, time, and talent to stay the course. And of course the discipline, which might be the hardest one. Minimizing expenses is definitely key, but there are many, many super-high quality "load" mutual funds that have lower fees than "no-load" mutual funds. Oh yes. And better returns too. Check the fund's annual expenses, which yo udon't pay out of pocket and hence can fly under the radar. That's the money they deduct from your return whether they've made money or not. Ideally, what you want is a combination of low expenses, a proven track record of beating the index, and a well-founded expectation that they will continue to do so (not just because you "feel" they will). Of course, there are very good offerings no matter which camp go with, and MANY more terrible ones. So do your research, either way. As far as buying certain sectors because they're "hot", wow, perhaps even worse advice. Gold was at $250 an ounce and more than doubled to $660, a price unseen in, like, forever. So where do you think it's more likely to go? Up or down? Gimme a break. As a matter of fact, let's say you don't even have a crystal ball, and so you have no opinion on where gold is going. Or stocks. Or real estate. Or bonds. What's a sensible investor to do? Buy a diversified series of QUALITY mutual funds. The one good advice I saw was that owning individual stocks is just way too risky. In many cases, it's more akin to gambling than investing. So go with funds, which are much more diversified, and therefore spread the risk among many, many more holdings. The key, of course, is buying quality. So make sure you hit ALL the asset classes, like Large cap stocks, small/mid cap stocks, international stocks, emerging markets stocks, government debt, corporate debt, hi-yield debt, foreign debt, emerging markets debt, real estate, commodities, and precious metals. That's 12 categories right there, so with $1200, you're talking about $100 each. This is called asset allocation, and it's a step beyond simple "diversification", which most idiots think is buying a hardware tech stock AND a software tech stock. Add systematically on a monthly basis. Soon you won't even care what any of the markets are doing. They're up? Great! Some of my investments are worth more. They're down? Great! Now I'm buying quality investments at an "on sale" price. Then sit back and re-balance each year, back to your original percentages. Again, this is called asset allocation. It's is very important, perhaps the most important thing you can do with your money. The thinking being, what's BEEN hot is more than likely not going to STAY hot. All markets are cyclical. There's hundreds of years of data to back this up. Yet some people still think they can ride the next hot wave. They usually wind up begging on the street for beer money. Now, this sort of portfolio should average 8-12% per year, so just split the difference and say 10% on average. Will it do 10% EVERY year? Of course not. I'd be surprised if it ever did EXACTLY 10%. That's an annual average. With that average, your money should double roughly every 7 years. So, if you're starting with $1200 or so like I said in my example, then in 7 years , even if you added no more money, you should have about $2,400 in 14 years you should have about $4,800 in 21 years you should have about $9,600 in 28 years you should have about $19,200 in 35 years you should have about $38,400 in 42 years you should have about $76,800 in 49 years you should have about $153,600 in 56 years you should have about $307,200 in 63 years you should have about $614,400 in 70 years you should have about $1,228,800! Of course, if you keep adding money in that $100 a month, you'll become a millionaire MUCH sooner. The key is discipline, and sticking in when markets are up OR down. Don't try to time the market--you'll NEVER get it right. By the way, here's a handy formula: $100/month x 12% x 20 years = $100,000. So if you need $300,000 in 20 years and have no idea how to get it, just save $300 a month and you're there. If you don't get 12%, you'll wind up with less naturally. But IF you still wind up with $250,000, I'd call that one hell of a failure. Oh, and if you qualify on income limits (generally, if you're a single filer and make under $90,000/yr), and do this all in a Roth IRA? Then every penny will be 100% TAX-FREE. That's a deal that's too good to pass up. That's why I tell anyone who's under 30--if you make under $90,000, and therefore qualify to do a Roth, you'd be a fool not to. Just having the power of youth (and therefore time) on your side is such an advantage, to squander it would be such a waste! Hope this helps! --J.
First, I would make sure you have at least 3 months salary saved up in the bank or in a money market fund for an emergency fund. Financial disasters like getting layed off or sick happen to all of us. Second, I would pay off all high interest debt. Pay off everything you can except the house mortgage and student loans. Paying off debt is one of the best investments you can make. You will have more money in the future because you won't have credit card bills to pay. Third, if you have money left, start investing 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 conservatively, in money market funds and bond funds, and part aggressively in stock funds. Vanguard.com has an on-line questionnaire which will give you an idea how aggressive you want to be. Investing in a mutual fund IRA for retirement may give you an income tax break. Talk to your tax adviser. You may also be able to invest in a stock mutual fund via a 401K plan at work. Believing someone you met over the Internet and know nothing about is risky. Read these websites for further information.