Stock Markets Exposed - Can I make good money off the stock market?

Can I make good money off the stock market?

I'm very young, 24, and don't even have a real job yet (won't until a year from now at the earliest) but when I do get some cash I'd like to invest it, wisely, in stocks. I'd be very active about it making sure to find out all the information and education on the subject and stocks that I can. Do you think this is a good idea?

Public Comments

you don't have the time, tools, or enough money to really 'play' the market. At your age, all you need to do is work hard at something you are good at and like to do... save money every month, and put it in an asset allocation mutual fund setup for someone who will retire in 30 years.
your enthusism is good; however, playing the stock market is not good for the average you and me unless you intend to be a stockbroker. your best bet is to open a traditional ira, 401k, mutual fund (ie vanguard), buy a house, start a business, educate yourself. read multiple streams of income by robert allen. don't get me wrong, the stock market is great for the long term but do it when you've finished everything else.
The earlier you get started, the better. It is not only a good idea, it is an outstanding idea. As soon as you get a job you may want to open a Roth IRA account and put1/2 your savings into it up to $4000. The other 1/2 you want to keep outside the Roth IRA in case you should need it. Why a Roth IRA? Because evey penny earned in a Roth IRA is tax free. But it is a retirement account and you can not really withdraw the money until you are 59 1/2 with certain exceptions. The reason I say "may" is because a young person might need money for certain things such as getting married and buying a house etc. that more established persons do not have to deal with. The only caution I have based on past experience I might add is to not invest too much in more speculative companies. They have a tendency to go south in a hurry during recessions. Actually, mutual funds are one of the best options for people just starting out in my opinion despite a great deal of negative comentary towards them in recent years. Just have to be somewhat careful in which ones you pick as with any investment.
Well, you certainly can make decent returns from stocks, the problem is if you "cash out" that money, you're power to earn is reduced. It's not passive income. Most americans seek to accumulate a large sum of money so when they're old they can cash it out and have enough so they can live on it until they die. However they don't realize that in order to retire, you simply need more money comming in then going out. I invest in stocks for my IRA myself, but I understand that it's just one source to park my money in and I'm learning myself about real estate. If you're willing to be active and find out information and education, you might want to consider real estate. There are lots of different ways to make money in real estate. If you don't have a lot of money; if you can simply find the good deals and do the work to find an investor, you should be able to receive a noticable stake of the profits. There are private money lenders that will give you money based on how good the deal is. Say you have 10,000 and invest it all in one company(not that I'd advise that). In the stock market if your $100 stock goes up 10% to $110 that's a 10% return or $1000+ any dividends In real estate you could find a $100,000 house for say $75,000 either by finding a house from a couple that's going through a divorce and/or bankruptcy and just needs the money, or a house that a family member inherited, or a foreclosed house through an auction, a preforeclosed house, or a house that went through the foreclosure process and is now owned by the bank. Now you could take that house and find a bank that loans you money based on the appraised value of the house. You can put 5,000 down, use $5000 to get it fixed up and get the house reappraised and if you increase the value the bank will give you that money back (although you will pay interest on this but if you're in the US the interest rates are near an alltime low). You then could rent out the house and have the tennants pay off the house and move onto the next one, OR you could sell it, pay off the loan and move on to the next one. Even if you paid $100,000 for the house including the mortgage payments and fixup without renting it out, and sold it for $110,000, since you were getting a loan and only using 10,000 of your own money, unlike the stock that went up 10%. In this example your house would go up 10%(after expenses) and you'd be paying 10,000 and you'd gain $10,000, a 100% return. You could even rent to own a house, fix it up and sublease it, and if you're going to college I think one of the best options is to buy a house near campus so you don't have to pay rent or live on campus, and find some friends to room with... If you do it right, you might be able to get enough rent from your roomates to cover your payment and you're living for free. Then when you graduate you can sell the property and use profit for future deals, or you can continue to rent it out. Even in a real estate crash, property by universities are still in high demand as they always generate cashflow for investors because there's never a shortage of tennants. It certainly requires more knowledge (and/or more assistence from professionals), but through the use of leverage your gain is larger. True, you can leverage stocks by trading on margin, but you can only leverage them times 2 and the instant your stocks go down you get a margin call and have to recoop their losses. In real estate the prices aren't defined that clearly and they are simply when a willing buyer meets a willing seller, and fixing up a house can improve the property by more than the cost to fix it giving you much more control over a tangable, not paper asset. If you DO plan to invest in stocks, I highly reccomend you learn to trade options sometime down the road. There are strategies which will return you 100% at http://terrystips.com/ This is a much more effective way to leverage as there's no margin calls, and the most you can lose is the price of the option if you let it expire, and you can even gain money if the stock goes down depending on your strategies. Goodluck!
Yes you can. And don't listen to the people who say that you shouldn't buy stocks because you don't have the time, money, effort, experience or because you are too young. Also, do not put money in a mutual fund. Well you can put it in one, but only temporarily. You should learn how to pick long term stocks. It is not as hard and complicated as you think it is, especially if you are investing for the long term. And don't listen to the people who say that you have to be rich in order to invest. No matter how much or how little you save, a certain % of your savings should go the stock market. The younger you are, the more stocks you should buy, as you get older, you should buy more bonds. The reason is because you have so much time to recover the money if you lose some or all of it. And by the way, if you avoid some stupid mistakes such as putting all the money into one stock or putting all your money into speculative companies, then you definitely won't lose all your money and you will minimize the risk of losing money. A lot of people realize that this is a mistake. But they don't realize that NOT putting your money into any stocks is also a big mistake. A lot of people avoid putting money into stocks because they think it is gambling and they think that hard work is the best path to being rich. Well they are wrong. Hard work, saving and investing are the best paths to prosperity. If you want to learn more about stocks, then go to investopedia.com, they have some good tutorials. Also, watch CNBC as much as you can. After you've got a decent sense of what the market is and are past the beginner's stage, then I suggest you buy "The Intelligent Investor" by Benjamin Graham which is one of the best books on long term investing, according to Warren Buffet. Also, I've found that talking to people who know how to invest also helps a lot. But make sure that you are talking to the right people; people whom you can trust and have confidence in. Remember one thing - every investor loses money at one point or another, it is common. Good luck and don't be scared and don't be stupid. "The greatest risk is not taking any at all"
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.
Won't hurt. You may also want to join a stock picking group to talk to experienced traders: http://finance.groups.yahoo.com/group/TradingZoom/
Can you make money in stocks? Yes. Two examples: During the 20th century the Dow Jones average went from 43 to 12,000 (ie a 43 dollar investment in 1900 would now be enough to buy a car). And the returns are impressive even over a shorter timeframe: I'm only a year older than you and I can remember when the dow first got above 2,000 (its now well over 13,000). It's also very easy to start investing: 1) Open a brokerage account (www.zecco.com, www.tradeking.com, www.scottrade.com are examples). Look for a broker that charges low fees for buying and selling stocks (zecco is apparently free) and that doesn't charge you a fee simply for having an account open. 2) Buy Exchange traded funds that track the market as a whole-- for example the SPDR fund (SPY) and the iShares fund (IVV) hold the 500 stocks that make up the S&P 500, a listing of the 500 most significant US stocks. Buy either fund and you'll effectively own stock in 500 companies (which means you won't need to worry about accidentally purchasing the next Enron.) And really that's it. You can look into investing in individual stocks as well, though I only really recommend it if you find the stock market interesting and have enough free time to do research on companies. Also if you have only a small amount to invest initally, funds are probably the way to go (owning stock in one company is inherently riskier than owning stock in 500). Good luck.
If your time horizon is long and you have a good understanding of stocks, then yes they can make good money. Let's get you started on some basic investing knowledge. Please read at least one of the following before you place your money into the market. A good investing book may be the greatest investment you'll come upon. Any of the following will help: 1) Mutual Funds for Dummies, by Eric Tyson 2) http://www.invest-for-retirement.com has a free PDF book. My personal favorite, because I know the author. In fact, the author is the guy staring back at me in the mirror. 3) http://www.investopedia.com has some good tutorials 4) Boglehead's Guide to Investing For a more advanced read, check out - A Random Walk Down Wall Street - The Four Pillars of Investing The two key phrases in long-term investing are: asset allocation and costs. When you focus on these two aspects, your investing will be quite successful. Hint, check out Vanguard (www.vanguard.com), because that's where all the smart investors wind up anyway.