Stock Market In Todays Economy-Search Engines For Advice

Monday, December 3rd, 2012

When you go to the search engines to do research on the term “stock market in todays economy” you will get a lot of advice about what you should invest your money in and what stocks you should avoid.

Much of this is traditional type advice, it’s the same thing you have been hearing for years from the self proclaimed “experts” of the day. The problem is that much of that information is wrong.

Recently I have started to educate myself about investing. I knew absolutely nothing about investing while I was married. We went to an adviser and we were told the same thing everyone else is told: to stay in for the long haul, that the market always tends to gain back any losses over time, etc.

After some painful, both financially and emotionally, losses I decided that maybe the information that most of us get isn’t complete or even accurate.

That is why I decided to look a little more closely. I started reading books about two of today’s top investors both of whom seem to have become extremely wealthy only on their own investments.

I like that idea. The guy we used to go to only made money when he got us, or any of his other clients, to invest in a certain stock or bond. He didn’t just live off the income he made with his own investments.

This is one of the first points I remember learning when I started doing my own research – why take advice about how best to invest my money from someone who isn’t “good” enough to live off their own investment?

I think that is a valid point and one you should carefully consider. Both of the investors I studied had similar outlooks on their money and how they invest. They have their own criteria that they use to decide what to invest in and what to steer clear of.

It is based on their own research and not what some talking head says. If the investment doesn’t meet their criteria they don’t invest in it… period.

When the market is too hot and all the stocks are overpriced, they don’t invest in it. Instead they will pull their money out and put it someplace safe. Perhaps they buy gold or perhaps they invest in Treasury bonds but they don’t leave it in the market.

They will stay out of the market as long as it takes to rebound. When a good stock, one that is undervalued and meets their criteria, becomes available they will buy it.

All of these things can be learned by any of us if we are willing to take the time. Here are a few things you need to take away from this article:

1. Knowledgeable investors don’t just “ride out” a bad economy. They get out early so they don’t lose any, or as much, and put their money elsewhere until the market provides more opportunities.

2. They don’t take advice from people who are paid only to give advice. Instead, they do their own research and make their own decisions.

3. They don’t follow the herds or the trends. They have learned from experience that most people get into the market right as it is heating up, which is the time these successful investors tend to get out.

Follow the winners, continue to educate yourself, learn from your experience and create your own criteria for when to buy and you can’t go wrong. If you build a solid foundation you will never have to ask yourself what to do with the stock market in todays economy, you will already know.

Online Trading In The StockmarketToday

Monday, November 26th, 2012

Today, thanks to the internet, online trading in the stockmarket is open to pretty much anyone with the cash to invest and access to the internet.

With this new found ability for even the average person to get involved in the stock market comes both pros and cons.

In this article I will go over a few of the pros and cons as well as some ideas of what you can do to make sure you are protected from making costly financial mistakes when you get involved with online trading in the stockmarket.

PROS:

1. Easy access 24/7. Even though the stock market isn’t trading around the clock, you will have access to many of the tools and resources of an online trading platform. This means that you can do research or continue to learn how the various interface works whenever it is convenient for you.

2. The ability to make trades for a very small commission. Many places will advertise trades for as low as a few dollars. This can help out the small investor who is just getting started.

CONS:

1. There are various trading platforms offered by the online brokerage houses, some of them are more complex than others. Even though they claim to be easy to use some people may still have trouble figuring it all out. It really depends on the individual and how comfortable they are with learning in general and technology in particular.

2. It may sound silly but it can be easy to forget that you are dealing with real money. In cyber land it’s easy to start thinking of everything as only “digital”. If you lose sight of the fact that you are dealing with real money you may just end up taking gambles you wouldn’t normally take.

3. Depending on the firm you choose, you may have limited access to a professional. While I always advocate learning all you can about investing and being a partner with your broker, there will be times when you have questions. If you don’t have anyone to turn to for the answers you need you may end up making a bad decision.

None of these things are insurmountable obstacles and they can be easily overcome if you are willing to invest the time. Here are a few things you can do to turn these cons around:

1. Before you sign up for any brokerage account, take some time and learn the basics of investing. Even the worst advice in the world may sound good to you if you don’t know any better.

2. If you aren’t particularly good at all things technology related, find an online brokerage that offers a full service plan. That way you can have someone accessible to answer any questions you may have related to investing or just how to use their software.

3. Carefully compare a few different online sites to figure out which one works best for you. Don’t just go with the cheapest costs for making trades. Consider other factors like the trading platform they use and whether or not it is a full service brokerage or a discount brokerage (which usually means a lot less help will be available if you have questions).

As long as you do your part and do your homework, online trading in the stockmarket can be a great way for you to take more control over your finances. Just don’t ever go in blind, educate yourself first and you will increase the odds of making more money.

Beginners Guide to Investing-Invest Beyound The Old Coffee Can

Tuesday, November 13th, 2012

Does your idea of investing involve an old coffee can with a slit in the top or a cute little pink piggy bank that oinks when you insert a quarter? That was okay when you were eight years old, but now that you have an eight-year-old, it might be time to start thinking about what to do with your money to help secure a future for yourself in your old age and your children as they mature.

First of all, that piggy bank is a way of saving money, not investing money. Saving money means you let it accumulate by your own hand; in other words, you make it and you put some away. There is definitely nothing wrong with that. Too many of us dont have enough savings to do much with, but if you want to really make your money grow, you need to invest it that is, put your money in places where it will grow even without your having to break your back to add more to it. That is the difference between saving and investing money in savings accumulates while money invested goes to work for you and makes more money for you.

The Stock Market

When you invest in the stock market, you are actually buying a small piece, or share, of one or more companies. A share of stock, even a single share (if your company sells shares in such a low quantity) makes you partial owner of the company. Therefore, you become invested in the performance of that company. If a store shows a profit at the end of the year, that stores owner has more money, right? Same thing with the stock market. If your company shows growth (makes money), you make money because you are part owner of that company. Of course, most shareholders dont get involved in the daily operation of the company in which they purchase stock; you simply try to buy the stock while it is relatively low-priced and sell it at a higher price.

When you add numerous shares of stock into this equation, the potential to make a bigger profit increases exponentially. The more you have to invest, the more you can make with the same amount of effort. That is not to say you must have millions of dollars to be able to invest in the stock market, of course.

Most investors, unless they come from a background of wealth and have grown up observing the ins and outs of investing, necessarily have to start small. And surely there will be mistakes along the way, but unless you want to endure long hours of toil to get money, you must start an investment portfolio.

It pays to do your research on a company before making a purchase of their stock; the more you know about what a corporation actually does, the more you can feel confident in your decision to buy into it. In addition to your own research, it is also wise to get a stockbroker in whom you have confidence. Stockbrokers are experienced in reading the trends and dealing with the daily fluctuations of the market, so they can be a valuable tool to both novices and professionals alike.