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Investing for Beginners
1 Comment | Posted by cashschool in Quick Cash School Success Steps System, Stock Investing
Being as intimidating as it may be, I’ve decided to create a guide about investing for beginners. Now, in no way, shape, or form am I a stock market expert. Rather, stock investing is a very big hobby of mine that I started off knowing nothing about and taught myself through reading and experiencing the ins and outs of stock investing. If you’re here, you’ve probably thought about investing but may have had no idea where to start or what to do. I’m going to give you the basics and resources I used to make me money through investing and hopefully you’ll have some fun with it, because it does get fun when you see your share prices rising.
Now as I mentioned when we started the Quick Cash School Success Steps System, you want to have a bunch of revenue streams bringing you in money. With that in mind, you need to keep updating your sites by adding keyword optimized and related content to it, submitting articles, and participating in blogs and forums.
Investing for beginners can be a very intimidating thing. Just look at any clip of Wall Street, a million things going on, people running all over the place, its organized chaos. On the other hand, it can be the greatest thing to ever happen to you. I remember reading somewhere, and don’t quote me on the statistics, that if you invested $5,000 in Walmart 20 years ago, it would be worth millions today. I’m here to tell you, it is not as bad as it seems and understanding the basics of the stock market can really boost your confidence and understanding of how to invest.
Investing for beginners basics:
This book gives you a great understanding of the basic entities of investing. Once you’ve read that, there are a couple books I’ve read that I’ll mention later. I don’t want you to go out and buy all these books right now and then decide you don’t like investing, now you’ve wasted extra money you could have used for something else.
Investing for beginners basic terms
These terms will be useful in the first part of this Investing for Beginners guideline. We’ll add more terms as we advance, but these will be enough to start off with.
AMEX: American Stock Exchange
Ask: The lowest price that the stock seller is willing to accept for a share of stock.
Bear Market Investor: An investor who believes the stock market is in the decline.
Bid: The highest price a stock purchaser will pay for a share of stock.
Blue Chip Stock: A stock with a long standing history of being a solid earner with increasing dividends. (Berkshire Hathaway & Coca-Cola come to mind)
Bull Market Investor: An investor who believes the stock market is rising.
Dividend: You could consider this a companies bonus to its shareholders. Certain companies give their shareholders a portion of their earnings to its stock holders. Some companies do it annually, some quarterly, and some (mostly small companies) don’t give out dividends at all.
Dow Jones Industrial Average (DIJA): Started by Wall Street Journal editor Charles Dow. It is comprised of 30 of the largest companies that reflect the American economy the most at the time. It is subject to change at any time to accurately reflect the American economy.
Market Capitalization (market cap): Multiply the outstanding shares of a stock by the price a single share. This is one of the key ways to determine the strength of a company you’re planning to invest in.
NASDAQ: National Association of Securities Dealers Automated Quotations. Approximately 3,800 companies compose this mainly technologically based stock sector.
OTC: Over the counter. Trades occur directly between two parties as opposed to exchange trading.
P/E Ratio: Price to earnings ratio. The ratio of the amount of a company’s earnings a stock earns for each share of stock. Divide the stock price by the amount of the company’s earnings per stock. For example, if the share price is $40 and the company earns $4 per share, the P/E Ratio is 10.
Penny stock: A stock that is priced under $5 per share and is traded on the OTC.
Wall Street: The birthplace and home of the American Stock Exchange. Located in Manhattan, New York and is considered the most important Stock exchange in the world.
Once you’ve gone over all of the basics, you’ll be ready to get started!
Investing for Beginners: Conducting your research
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