Stock Market

As a beginner you are entering a brave new world of stock trading. Stock market education for a beginner can be daunting - and costly. Though I’m now a casual day-trader my experiences have allowed me to touch many aspects of the market.
I could have done with these tips when I was starting out.

EDUCATE YOURSELF

As a beginner you have choices. You can be impatient and buy a chimp to place pins in a list of stocks and throw money at those, making darn well sure you keep your fingers crossed and a rabbit’s foot handy.
Most people do this (not with the chimp and rabbit’s foot obviously!) and wonder why they don’t make any money. Essentially what you are doing is gambling, putting your stock investments at the mercy of the market.
You get round this beginners impatience by learning stock trading strategies, there is plenty of advice online about them some of it at my website, details below.
It’s a good idea to buy a book on the market or scour the internet to get familiar with stock graphs and the jargon involved and with stock trading strategies so that you take some of the risk out of investing.

KEEP UP TO DATE

The internet is great for information. Everything you need to make money is there. You can learn about trends, stock news, get tips and get archived share prices for most stocks. The difference between you and the next person will be that you spot the latest trends, read the stock tips and scour the accounts of companies to crunch numbers.
There are reliable places you can go to get free stock quotes just filter out the trash, as there is much on the internet these days.

NO SUBSTITUTE FOR KNOWLEDGE AND EXPERIENCE

The knowledge comes from the books and from the internet; the experience comes from going out there and investing.
Educate yourself until you get to the point where you can finger a stock and give detailed reasons to buy (trends, p/e, price study) it based on your research. Once you get this knowledge you will be confident enough to buy. Don’t be put off by losing money. In the long run those who learn and do their due diligence are rewarded - maybe. In short focus on a clear set of strategies you can employ at short notice once you finger a potential stock.

ALTERNATIVES

I realise that not everyone has the time and patience to study Fibonacci numbers, analyse charts and patterns and crunch numbers. The biggest problem with buying great stocks and doing your homework is that for some unknown reason they can go down even when the evidence suggests they should be rising. Check out my site to figure out an easier way of making money and picking what stocks to invest in, without the brain ache!

So, who want to make a great deal of money? Well, everyone would like to do this. However, not everyone knows exactly how to go about it. Here is the answer: the most tried and true method of amassing a great deal of personal wealth is the ability to trade stocks on the market.

To define trading on the stock market is rather simple

Trading is the art of buying low and selling high. In plain parlance, you earn a profit by selling the stock at a higher price than what you paid for it. Some individuals will buy and sell their stock in a rapid amount of time. Day traders are known for buying and selling within the same day or week. Then, there are those that buy their stocks and hold on to them for many years. That is fine as long as the stocks are appreciating in value.

The first step is finding a stock that interests you

Or, perhaps, interest is not the very best word to use. While there is nothing wrong with selecting a stock based on personal preference, you will also want to select a stock that has the potential to yield a good return. Remember, stocks not only go up. They can go down. Needless to say, you do not want to make a poor purchasing decision since you could end up losing a great deal of your initial investment. That means you need to conduct a little research into the market. Read the financial pages in your local newspaper or check out the online resources that track the market. Perhaps you could even subscribe to an analytics service that will present you will up to date information on what stocks have the potential to become hot. However you go about it, the key is to be as informed as possible so you have an insight into what stocks may turn out to be valuable investments.

Then, when you have decided what stocks to purchase you need to actually make the purchase. If you are buying stock in the company, you could simply make your purchase directly from said company. All you need to do is fill out a purchasing form and send a check in the amount of shares you wish to purchase. No, it is not a complicated process.

You could, however, have a stockbroker handle the purchasing as well. The broker also acts as a financial adviser and makes recommendations as to which stocks to purchase. Yes, the broker will charge a commission for any purchasing he does. If, however, the stock takes off (increasing in value a great deal) then the commissions will be more than paid for.

Learning how to trade on the stock market is not a difficult venture at all. Picking the right stocks, well, that can be a little tricky since there are no guarantees. However, anyone who makes safe and sensible buying and selling decisions will probably achieve the desired results. All it takes is a little self-study and experience. Again, it is not as tough as some initially assume.

Everywhere you look at the moment you see the headline ‘Crash In Stock Market’ followed by words of fear and uncertainty. Every news update on the radio and television opens with the latest updates from the days trading. “Share prices have been slashed” or “The Stock Market crashes again”. Never before in my life have I heard such out of control fear and reporting on a economic issue. The markets have crashed before and I can promise you that they will happen again but is this the worst crash in the stock market that we have ever seen? If you ask the media “YES” but to be honest I don’t really care. I think we should focus more on how to deal with it rather than just getting ourselves stressed and fearful.

When are we going to see the headline? ‘Crash In Stock Market - Once In A Lifetime Opportunity? Because in reality this is exactly what it is? There are two main way to take advantage of the current low cost of shares.

1. Understand how to make money from a falling market. You can pay for every stock market report etc. but I think you would all agree that for the past few months anyone could have seen that the market was in a severe down trend. So without any stock market advice you would have had a good idea that the share prices would continue to crash. What you probably don’t know is that it is very easy to take advantage of this and make truck loads of money. In fact professional investors love it when they see headlines such as ‘Crash In stock Market’ because the market moves so quickly. Professional investors make more money during stock market crashes than at any other time. Why because they know how to take advantage of a credit crisis.

I can hear you saying “how do you take advantage of a stock market crash?” Quite simply you buy ‘put options’ or as some people call it ‘insurance’. I like to describe it like buying insurance for a car that you don’t own - then when the car has an accident and looses half of its value the insurance company gives you half of the cars value in cash. I know it is a slightly weird concept but this is exactly what lots of people are doing. The best thing is that is completely legal and very easy. Could you imagine being able to buy insurance on a car that you don’t own once you already know that the person who is driving that car is blind and loves going fast? It is almost too good to be true.

2. The second way to take advantage of lower share  prices is to simply buy when everyone else is selling. Now this is slightly scarier because even though some shares are worth half of what they were last year they still might keep falling. So you must be willing to go through some short term pain. If you are willing to do this then the 2008 Stock market crash may truly be a once in a lifetime opportunity.