Money Forum World

Abel Watson · Joined: 08 Nov 2007 Posts: 2070

I wish to start testing the stock market waters because I know being a young investor may be useful.

At this point, Im only somewhat familiar with volume, the three types of stocks penny, growth, blue chip, and the two general techniques of earning money dividends and stock prices increasing .

But everything else particularly in depth researching is very foreign to me. Im tempted to just take internet advice, but I know that isn't the most secure way to choose where to place my money.

Yet besides reading opinion articles, I dont know which pieces of info about the company to search for, and also, I don’t have idea about how to put these pieces of info together to form a complete opinion about a stock.

Any info about researching stocks particularly how company history etc plays into the mix are welcome.

Thank you all in advance.

Fredric Richards · Joined: 08 Nov 2007 Posts: 2112

I hate to bring you the bad news but, it's hard to effectively research stocks by yourself. Unless you have a degree in finance, like I do. The best thing you may be able to do is to invest your money in a DIVERSIFIED PORTFOLIO. Dont attempt to purchase one stock because youve heard some news of it and it seemed interesting, or if the stock was recently upgraded by big name investment banking companies like Goldman Sachs, Morgan Stanley, or Bear Sterns.

The fact of the matter is that it's high risk to do that. you may be able to lose lots of money that way. Its too high risk and not worth it. Imagine how you could feel if you invested $5000 in a stock, then it drops down to $2500 in a week.

Best thing to do is to build a portfolio of stocks using some number of industries which are diversified and carry a low risk. There should be at least 14 stocks in your portfolio. Ideally, there should be 30, but few people can have enough money to purchase 30 different stocks.

However, if you really want to learn how to research stocks, then I propose studying applied equity valuation techniques like the EP or the DCF models.

Abel Watson · Joined: 08 Nov 2007 Posts: 2070

go to . Finance lots of great stuff there.

Elliot Pena · Joined: 08 Nov 2007 Posts: 2103

new york times

$$$Guru · Joined: 08 Nov 2007 Posts: 2084

I personally use Sharebuilder. Quite lots of info on that site.

Good luck.

Importer · Joined: 08 Nov 2007 Posts: 2161

Read, Read, Read. and listen to others. finance really has a lot of great articles. Most articles will have to links to businesses, from there you may be able to check out their financials which start out greek, but seem right after awhile. you may be able to set up practice portfolios on and tract stock performance to see if you have what it takes, and it's better than learing the hard way.

In every business there are winners, so find something you like, and concentrate on that area. you'll most likely know more about that business, and have a better Idea of where the next moves will be.

Burton Burns · Joined: 08 Nov 2007 Posts: 2167

Learn technical analysis. Then youll be able to recognize the general trends in prices, you have to be able to understand the charts before you start investing. News is just a marketing tool. The price doesn't lie.

Check out this ugly guys blog to get an idea of what im talking about. blog.fallondpicks.com/

Issac Lindsay · Joined: 08 Nov 2007 Posts: 2082

Since you're young you dont need a get rich fast thing, so look for the Blue Chip stocks big businesses that have been around a long time and will be around when youre old. Dividends are a good thing. There are stock money that invest in a large range of businesses which minimize your chance of losing money. Then you dont have to watch your stocks everyday just sit back knowing that, barring a depression, history is on your side.

Olga · Joined: 08 Nov 2007 Posts: 2182

There are stock investment clubs which are good in your local community who study stocks. Also the NAIC has a great magazine and non profit organization that teaches people how to invest. Good luck.

KevN · Joined: 08 Nov 2007 Posts: 2020

First gather some general idea as to what is happening in the markets, the macro economic situation and all other related business information, for all that you have to read a good business paper.

Next could be learn more abt what kind of businesses and sectors you want to invest in. you may be able to do that by reading the Cos financial yearly reports, its filings with the SEC, etc, then understand the trend of the share, its price, volume and related information.

More imp keep your eyes and ears open, remember in the stock markets, info is money.

Mathew Velasquez · Joined: 08 Nov 2007 Posts: 2131

There are lots of books that will tell you about investing. You may start at your library or go out to and check out what they have. If you open an account with Fidelity, they have lots of research material on businesses. A great deal more than TD Ameritrade as an example.

There is the choice of investing in mutual money. That way you don't have to do so much research. You just have to find out which mutual money are good and the universe is much smaller. you may be able to purchase mutual money directly from the fund company or many through a stock broker like Fidelity or TD Ameritrade. Some you may be able to purchase like stocks.

But 1st things 1st. Get a couple of books and begin reading on investing in stocks. there's a Investing for Dummies book and it's greatly thought of.

Lorene B. · Joined: 08 Nov 2007 Posts: 2039

Ugly Eh???

,

Thanks for the reference link I have a site which features stocks with listed stop, target prices and annotated charts.

fallondpicks.com/Members/Breakout.

Best wishes,
DJF