Buying Stocks for Beginners: A Guide

Published on: 26 April 2018 Last Updated on: 31 May 2022

Investing your money wisely is one of the best things you can do for yourself and your future. It’s never too early to start investing your money so that it will grow.

Buying stocks for beginners can be scary, but there is plenty of guidance available. This is especially true if you are looking to buy US stocks outside of the United States, in which case you´ll need the help of a broker to access those markets.

If you are new to the world of stocks and investing, you will undoubtedly have lots of questions and will need to take the time to learn some basic concepts.

Buying Stocks for Beginners: A Guide

Check out this guide to buying stocks for beginners.

Why Invest?

Investing is a way to make your money work for you. Rather than sitting idly in the bank, investing your money in stocks is one way to help achieve your financial goals.

Though the stock market may have its ups and downs, it has historically averaged a 9% return on investments.

How Much Should You Invest?

How much to invest depends on your goals. This is something to discuss with your financial advisor or brokerage firm, but a good rule of thumb is to contribute about 10% of your income to your investment portfolio.

Basic Types of Investments:

There are many options to invest in, but the basic types of investments include Stocks, Bonds, Cash, Mutual Funds and ETFs.

We recommend you consult with a reputable financial advisor for suggestions on how best to distribute your funds.

How you choose to invest will boil down to how conservative or aggressive you feel most comfortable regarding your finances.

For more information on investments be sure to check out thinkorswim vs tastyworks.

Investing Actively or Passively:

Active investing means selecting investments that are actively managed by professionals, with a goal of beating the market and achieving greater returns. Whereas passive investing is to simply try to match the market’s performance.

The choice of whether to invest actively or passively essentially boils down to how much time you want to spend studying the market. Active investing typically requires a potential investor to do extensive research into individual stocks.

Choosing the Right Stocks to Invest In:

For a beginner, it might be wise to consider certain types of stocks that are good long-term investments. It’s important to take your time, learn the basics, and to research into the ways stocks are valued.

Another thing to educate yourself on is the difference between investing and speculating. While investing is typically designed for sustained returns over the long haul, speculating is a dangerous way of chasing fast money.

Getting Started:

Once you understand the basics of buying stocks, you’ll want to open a brokerage account. Shop around and study the various brokerages to learn about their services and fees.

As a beginner, you will want to find a brokerage with features to guide you through the stock selection process.

Buying stocks for beginners can be an exciting process, and watching the return on investment as your money begins to grow can be a source of great satisfaction.

Click here to see more great business articles.

Read Also :

Ariana Smith

I enjoy writing and I write quality guest posts on topics of my interest and passion. I have been doing this since my college days. My special interests are in health, fitness, food and following the latest trends in these areas. I am an editor at Content Rally.

View all posts

How To Become A Successful Cryptocurrency Trader In 5 Easy Steps

In the last few years, cryptocurrency trading has picked up in a major way. The rise of cryptocurrency exchanges and trading platforms has meant that normal people, like you and me, can earn handsomely from cryptocurrency trading. The first cryptocurrency, Bitcoin emerged into the scene in 2009. Over the last decade, the cryptocurrency has traded to record highs of $20000 USD to lows of $4000 USD. However, investors and traders have been able to make millions by doing the right kind of trade. In this article, we look at 5 easy steps that can help you become a successful cryptocurrency trader. How To Become A Successful Cryptocurrency Trader In 5 Easy Steps: 1. Choose the right Trading Platform: The first step toward success is also the toughest one. If you want to be successful, you need to work on the best crypto trading platform. This is because successful trading is all about the cryptocurrency software, which platforms use. The best trading platforms use the most sophisticated and advanced software. This software helps you see trends, show future projections, and make informed decisions. It is essential that you do your research and evaluates how good a platform really is. 2. Make Low-Risk Trades initially on the trading platform- Most people who are too eager to get into the cryptocurrency trading game create one cardinal mistake. They make high volume and high-risk trades very early on. If you are able to pull off a high-risk trade, you stand to make greater profits. However, this is a strategy, which should usually be followed when you are experienced as a trader. When you are starting out, it is best to go slow when it comes to making trades. This will help you get an idea about the dynamics of the trading platform and gain experience. 3. Let the Trading Software do the bulk of the work for you- The best cryptocurrency trading platforms invest millions of dollars in securing the right tech for their platform. This software uses complex algorithms Artificial Intelligence and Machine Learning to bring you the best trades. If you want to be successful in this trading ecosystem, it is best to make informed decisions. The software is powerful, user-friendly, and will guide you at all times. Yes, the final decision rests with you. However, inexperienced traders should pay attention to what the software suggests. 4. Be informed of Global Happenings and keep yourself updated: While you do not need to spend more than a couple of hours every day on the trading platform, you can always keep yourself updated. This means reading up credible journals on cryptocurrency and doing your own research. Many global happenings alter the valuations of cryptocurrencies. For example, if countries start legalizing Bitcoins and other cryptos, it usually leads to a massive hike in valuation. (When Xi Jinping took a favorable stance on Bitcoin and Blockchain, the valuation soared by over 30%). 5. Be Safe, Secure, and Protected at all times: The world of cryptocurrency attracts cybercriminals. This means that you have to ensure security on two levels- on the trading platform, as well as your own system. Choose a trading platform, which has a strong firewall, great encryption, and password protection. On your end, you can choose an industry-leading antivirus solution to help you protect yourself from phishing, malware, spam, and other dangers. Conclusion For a very long time, the general population could not take part in earning from cryptocurrencies. Mining is very expensive and requires strong technical knowledge. However, trading platforms are a great way to earn from cryptocurrencies. By following all the above-mentioned steps, you can rest assured that you are well on your way to become a successful cryptocurrency trader. Read Also: 4 Business Leadership Skills for Business Success Exciting Facts About Cryptocurrency And Crypto Wallets

7 Wise Financial Choices That Will Help You Follow Your Budget

Spending is an obvious thing in life. Inasmuch as someone is alive, he or she cannot just avoid spending money. To keep living, we need money. We cannot access some basic necessities such as food without money. Spending money is a basic fact in life. But the manner in which you spend can determine the quality of life you live now and in the future. Proper spending behaviors will protect you from incurring too many costs on an item. In fact, good financial habits will help you not overspend and use your finances in an appropriate manner instead. It is very important to take time and examine your spending habits. Make the necessary changes and see yourself succeeding financially. The key to financial health is to always stop and think. Before you make a purchase, it is important to ask yourself if the purchase is really necessary. But the most significant thing you can do is to budget. Through budgeting, you can save a lot of money and help you have extra cash to spend. Put differently, your budgeting style along with healthy financial decisions will determine how successful you will be. You need to decide how much money you will regularly spend on some items and stick to that decision. In this blog, we are going to address two things; the wise financial choices that will help you stick to your budget and the best way to outrank bad spending habits with good ones. A good housekeeper will always know when the home is organized and when it is not. This should always be followed by a remedial course of action. The same thing happens with your budget. You know when it is not effective and then you take steps to redesign it. When it comes to budgeting, you control everything. One way of appreciating your hard work and efforts is to remain true to your budget and even seek help where necessary. The following tips will help you follow your budget always: Make it realistic and practical. Let us take an example of what you set aside for entertainment monthly. If your budget is $80 every month but you spend a total of $240, something is wrong somewhere. The best thing to do is to get to the middle. Increase the allocation to probably $160 and lower your spending down to that level. The more real your budget is, the more you are likely to go by it. So make your budget real and be true to it. Plan how you spend on meals: Do you go for grocery unplanned, not knowing how much you are going to spend at the store? That is like taking a financial poison and you might get overwhelmed with time. The point is, you should plan for your meals, breakfast, dinner, and lunch. You do not have to pick whatever appears to be good in the stores. Just visit the stores with a list of the things you are going to pick along with how much you are going to spend on them. Pick all you need and leave the store right away. Stop using credit cards: Recent studies show that about 83% of Americans prefer credit card payments to cash. This is because credit card postpones the pain that comes with payments until later in the month. This is a temptation that can make you spend too much money that what is worth for an item. Avoid this problem by sticking to your debit card or cash. Do not allow the challenge that comes with delayed payment to force you into incurring more costs on items than their worth. People even seek loan online as it’s convenient moreover for you to be sure that your lender is legit, they need to explain the loan terms clearly like A1 Credit a trusted financial institution. Learn to wait: If you out for window shopping with no desire to make a purchase, then you come across a very nice t-shirt but nothing is left on the money left set aside for clothing, just walk away. Breathe in and convince yourself that you will actually buy it but only next month. By that time, you have accumulated enough cash to make that purchase. Consider social events: You perhaps like celebrating events with friends. This could be on events such as weddings and anniversaries. But the problem is that you fail to include the associated costs in your budget. Draft a social calendar and always consult it. Note your necessities: Your basic necessities may include food, housing, and medication. If you commute to work, transport cost may also be included in your basic wants. Do not spend too much on luxuries. But note that a basic a luxury to you may be a basic want to someone else. Just define your basic necessities and prioritize them. Restrict to your budget: Prioritize your needs and how you spend on them. Set goals on your money. Try to restrict yourself to the provisions of your budget. Do not live beyond your means. Accept to live within your abilities. It can be quite challenging to stick to your budget. However, it is possible if you fully determined to do that. The seven tips discussed will help you in this regard. What about your financial habits? Well, let us briefly see how you can break them. It can equally be challenging but you can be successful if you use the following tips. Cut spending on clothing. You don’t have to visit a store on a weekly basis. If it is necessary that you spend, but let it be at a thrift store and you will save money Eat at home. Incontrovertibly, eating out is expensive. Learn to cook your meals at home. Besides, if you have a family, it is only good to share meals as a family. Reduce entertainment costs. Consider free entertainment alternatives around. Avoid credit cards. They postpone the pain that comes with making payments at a cost. Learn to use cash or your debit card instead. Repay debts in time to avoid extra charges. At whatever cost, do not use funds from your retirement account. Conclusion: Making a budget and sticking to it are two different things. But if you follow the tips discussed in the first section of this blog, you will be successful. Nevertheless, sticking to your budget can be senseless if you have the same bad spending habits. We have discussed six tips that will help you outrank bad spending behaviors. We wish you the best as you shape your financial life. Read Also: Debt Consolidation Plans For Your Debt Relief Ways That You Are Wasting Money On Marketing How To Become Financially Stable Before Age 30 How Financial Trading Can Give You The Life You Want How Artificial Intelligence Is Helping Banking And Financial Institutions? The Importance Of Saving: The Bedrock Of A Bright Financial Future

Investments 101: How to Choose a Smart Stock

There are less than 4,000 publicly traded companies in the US today, down from the 1997 high of more than 7,000. Such a limited pool doesn’t make it any easier to pick stocks these days, though. In fact, one of the first questions new investors ask is about how to choose stocks. The stock market is a big gamble, and if you choose right, you can win big time. In this guide, we’ll go over the steps you should follow to pick a good stock. You may not be the next Wolf of Wall Street, but selecting the right stocks will put you on firm financial footing. Assess Your Goals: It’s easy to ask how to find good stocks. The problem is that “good” is relative to what you want from investing. The very first thing you need to do is to take a look at your own goals. Why are you investing? What do you hope to get out of buying stocks? Answering this question will provide the underlying “investment theory” for your stock-picking strategy. If you want to maximize your returns and get out of the market, you’ll need one strategy. If you plan to be in it for the long haul, you’ll likely use a different strategy. Start with Index Funds: Index funds, like mutual funds or exchange-traded funds (ETFs), are a great place to start. First, they make good beginner investments. You can buy into one of these funds to gain exposure to the market. With mutual funds or ETFs, you don’t need to buy every individual stock in the fund. They also have low management fees. For those of you wondering how to pick a stock, they're also a great place to start your research. These funds contain most of the large companies in a given industry. They also collect information on the performance of their holdings. You can then narrow down the list to the individual stocks you’re interested in. The index fund can tell you that industry is on the rise. It can also tell you which companies are outperforming others in the same industry. Evaluating Financial Health: After you’ve picked some individual companies, you’ll want to evaluate their financial health. The next question you should ask is what to look for when buying stock. Information about performance and profits is easy enough to come by. You’ll also want to look at more intangible factors, such as the company’s staff. What makes them unique? A good way to collect some of this information is to look at investor presentations. They often share details that will help you learn how to pick good stocks. Another thing you can do is check forecasts. For example, you can look at the Valeant stock forecast to see how a certain company is recovering from a major scandal. No Magic Formula for How to Choose Stocks: Keep in mind that there’s a human factor involved in the stock market. You can do careful research and invest in what you think is the best stock. Key personnel could then leave the company, and the stock underperforms. The long and short if it is there’s no magic formula for picking good stocks every time. Understanding your goals and doing careful research will help you make better choices. Start Building Your Financial Future: This quick guide should give you some more ideas about how to choose stocks that support your goals. As you continue to invest, you’ll be able to refine your strategy. Interested in diversifying your portfolio? Check out our blog for more informative articles. We have advice that can help you work toward a brighter financial tomorrow. Read Also: Buying Stocks For Beginners: A Guide How Businesses Can Use Stock Trading 5 Awesome Facts About CryptoCurrency Main Factors That Affect Trading Decisions Top 9 Forex Trading Tips For Beginners That Save You Money

Buying Stocks for Beginners: A Guide