Investing in the stock market for beginners
" NYSE- Euronext, NASDAQ, and the American Stock Exchange are the popular equity trading exchanges in the U.S. "
" Names of companies are not recommendations. "
" Asset allocation, aggressive 75%(1)-25%(2) Vs balanced 50% (1) -50% (2) Vs conservative 25% (1) -75% (2) "
If you are going to buy your own stock, you'll need to find a company to invest in.
There are thousands of companies listed on the popular exchanges for you to consider.
But stay a way from Enron and WorldCom kinds of companies. Getting tired of hearing that?
This is a very important message, that you do the homework in choosing a company to buy. If you are concerned about choosing the right company, look at funds. Or look at what funds have in their portfolio.
If you cant make the time to research these companies on your own, then maybe you would be better off with a fund and a fund manager that can manage the risk on a daily basis.
There are several ways to go about buying stock.
You can buy shares direct-- direct buy DRIP (Dividend Reinvestment Plan) programs - from the company or from its authorized agent. Examples could be Intel, IBM, Exxon, GE.
You can buy stock from a discount brokerage, like ShareBuilder or ETRADE.
You can buy stock from a brokerage firm, like
If you haven't heard of a company and can't immediately identify with it, then it is your responsibility to research.
Even if you can identify with a company name, you still need to become very comfortable with the choice.
Until you get very comfortable with investing, you probably should stay away from non-domestic stocks, global markets are very tricky with geopolitical events and Dollar conversion.
If you have to diversify globally, and that probably is a very good idea, get a fund manager to do that for you by buying in on a global fund. But do your homework and read the perspective of information before investing.
The big question is, when to buy and more importantly when is it the right time to sell.
Do you sell when you make a profit, or when the stock sinks and you're losing a lot? Remember goals? That's why you are investing. The "when" can be anytime based on the goal.
-long term- -short term-
Find a company or fund that you want to invest in. How?
The Internet is full of places for you to do just that. All the brokerage firms have tons of tools. Other market news sites have tools.
-MSN- -CNBC- -CNN- -Bloomberg-
The Internet is a great place to find information.
Once you have found the company or fund to invest in, determine how much money for that goal you want to invest.
As a rule of thumb, you might invest a portion of the money. That is, If you have $10,000 for the goal, take a portion of it, lets say $2,000, and make an initial buy.