how doi purchase stocks
i don't have a lot of money to invest, but if i start at small, then i can i increase my shares of stock, or buy different shares of stock?
Answers
2775 points
Oldman answered one year ago …
You need to determine if you can open an account at some brokerage or mutual fund company. Fidelity, T.RowePrice, Vangaurd, and many others that mostly have mutual funds, now also have brokerage accounts , from which you can trade stocks. If you do not want to invest their minimum amounts to open an account, Please se the response to the question about buying only 1 or a few shares, via Sharebuilder.com from Mr. Sundarkambam, in answer to Shamus' question about buying 1 or 2 shares for his son's account (about 2 days ago).
Now,to a more pertinent bit of advice, before getting into stocks, have you considered funding an "emergency reserve" of 3-6 mos. expenses; have you considered paying off any credit card or high interest charges (that's an imediate 10-20% return!); have you considered if stocks/ETFs or mutual funds are the places to start investing?
321 points
charlo answered one year ago …
The first thing I would suggest is are you ready to get into the market?
There are a few things one should consider before risking personal capital into stocks. Make sure that this isn't play money, because personally I don't think money should ever be looked upon as "play". Just like Oldman pointed out, making sure you don't have any material debt outstanding, making sure you continue to save and not subtract your savings amount.
But the most important thing you should consider before even shopping around for online brokerages, is to have a sound investment plan, time horizon, and most importantly, doing your homework when investing, rather than just buying the hot tip you heard or read somewhere (don't worry, I've gone through this plenty of times). There could be numerous things to consider so tread carefully. Don't get me wrong, it's a great journey and loads of fun, but it is money.
www.fool.com has a great starters page for anyone who's interested in investing. make sure to check it out. good luck!
3963 points
MNSL answered one year ago …
Some of the points made by Oldman and Charlo are very good for investors who new to the markets. I think if new comer wants to invest in stocks he should learn stock market thoroughly. This is not a time to enter stock market if you are new to the market. Some new investors who entered stock market at the wrong time lost their entire holding. Now we see market fluctuations almost everyday. Those days we were able to see market direction as there was less fluctuations. Please remember stock market, commodity market and real estate markets don’t go up continuously. Through out the history, we have seen bubble, crash, correction etc in the stock market etc. Examples are: 1987 crash, recent housing crash, and recent market corrections through out the word etc. Experienced and intelligent investors know how to minimize their risk and how to pick outstanding stocks during events like above.
I think If you a new to the market it is better to learn as mush as you can now. There are plenty of websites and plenty of books. Fidelity is a good place to start because their record is good and they will give you good return. Don’t depend on research reports, advisors alone. If you like to invest in a company Pl look for fundamentals, consistent earnings in the future, higher demand for their products and services, less competition, with outstanding management and strong balance sheet. Try to understand ratios like P/E ratio, earning per share, return on equity etc at the beginning. You can compare companies. I think new investor should enter the market when P/E ratio is low. Then he can avoid paying higher price for stock. Greater the earning per share it is good. If you see stock with higher return on equity (more than 20%) Pl keep it under your radar.
If you don’t have lot money make sure you are not over paying for any stock. Present bull market started 05 years before and most stocks are now overpriced. However still there are stocks, opportunities all over the world. There are some stocks and commodities will do very well in 2008 and 2009. We are in final stage of this great bull market.
127 points
dnce answered one year ago …
All of the above are great points. It deserves repeating that before beginning to invest in equities, one should become familiar with the vernacular, etc. I'm in the process of doing this myself by reading the huge amount of information available free on the web at places like investopedia, fool.com, tycoon report, etc. When ready, and above all, able to begin investing, open an account with a brokerage. I use Ameritrade, but there are several others from which to choose based on their fees and your goals. Once you have decided, based on objective criteria, which stock you wish to invest in, you need only tell your broker how many shares you want and voila! you're an investor.
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nicon1957 answered one year ago …
I am a new investor. I made the mistake of taking the advise of a telemarketer type stock broker with a large Wall Street firm. He got me into Advance Micro Device (AMD) and Edge Petro. (EPEX) last summer. Both these stocks have lost about 50% of their value. Since then I've been reading everything I can get my hands on to understand the game better. One of the best tools I've used is the simulator stock market game on Investopedia.com. It gives you 100k of play money to invest, then tracks the performance of the stocks you pick as if you invested your own cash. It allows you to ask the right questions and practice what everyone preaches before you commit your hard earned dollars. I got a couple of friends into the game and now we compare notes on a daily basis. Its nice getting the feedback from people that you know, plus we are all learning together. I've found that I now pick stocks better then some of the so called experts. Good luck in your investing.
Read more from nicon1957120 points
bomo answered one year ago …
All I can say is please don't do what I did. Someone told us of a stock that was going to make them millions...yep, you guessed it. We took ourselves and refinanced our home to get the money. INvested in it and little movement occurred then when big movement (up a dollar) happened we did not know to sell it for that was the high, not ever going to the $20 mark as we were told. From there, I learned about chat boards ie raging bull, ihub, etc.,. While I thought everyone was there for honest chat and to help me in my dilema, they were actually shorting the stock, of which I had no clue. Right now our bills are higher than the value of our portfolio and I just keep hoping things will rebound for us. It has been four years and we see no end in sight for the misery that our ignorance of investing has caused us. Practice before you pay your money down for any stock. Do not listen to Cramer, and put all your faith in yourselves to learn before you can ever expect to earn a dime. glty and do not leave yourself ever "hoping for the stock to rebound.:
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