Online investing - tips?

 
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mike_dee23
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PostPosted: Mon Jul 24, 2006 10:42 pm    Post subject: Online investing - tips?

Being from a 99 percent Mexican neighborhood, I learned very little about things like the stock market, bonds, IRA, 401Ks, etc. I read a book called "Generation Debt" - a must read for college students - and decided that since I'm relatively young, nearly 30, not married, no kids, maybe it's time to begin investing in the market.

I plan on starting a 403b or an IRA come September when I begin my new teaching job, but I also want to invest a couple of thousand in the market. E-trade looks like it'd be easy, but I just want to know how to begin without hiring an expensive financial advisor. Anyone know any books or have any tips?

Thanks!
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Muad'Dib
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PostPosted: Mon Jul 24, 2006 10:48 pm    Post subject:

Buy low, sell high.



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mike_dee23
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PostPosted: Mon Jul 24, 2006 10:51 pm    Post subject:

Muad'Dib wrote:
Buy low, sell high.





I should probably watch Trading Places, huh?
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Muad'Dib
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PostPosted: Mon Jul 24, 2006 10:52 pm    Post subject:

Classic flick.
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Muad'Dib
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PostPosted: Mon Jul 24, 2006 10:56 pm    Post subject:

There are just as many ways to make some lana in the market(s) as there are to lose some. There are tons of systems, schemes and methodologies re: speculation and investment, all of which promise to deliver.
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The Dagger
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PostPosted: Tue Jul 25, 2006 7:52 am    Post subject:

Invest all you possibly can into a retirement account - this is your most important investment. The first five years are critical. Invest as early as you can, preferrably at the age of 18. But it is never too late.

If you're going to invest in stocks and are into short-term trading, NEVER lose more than 10% on any individual stock. If it went down over 10% it will most likely keep going down. You can always buy it back when it starts going back up. To many people refuse to sell because they do not want to admit defeat, those are the people that fail in the market.

If you go long look for under-valued stocks in strong companys.

NEVER buy penny stocks. If they go south, you may be stuck with it.

Read the business section of the newspaper. Subscribe to Investor's business daily or the Wallstreet Journal. Read it everyday. Take a stock trading class or read some investment books.

Learn how to sell short.

Oh, and never fall in love with a stock.

Good luck.
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Socks
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PostPosted: Tue Jul 25, 2006 8:30 am    Post subject:

I personally find Fidelity a lot better than E*Trade as far as online accounts go.

Anyway, if you're interested in investing in individual stocks and want to learn how, you can do lots of learning online about methedologies. A good place to start there would be: http://www.aaii.com/ and http://www.investors.com/howToInvest.asp.

Anyone can learn the basics and everyone has their own favored methodologies for picking individual stocks. With so many stocks out there, the trick is going to be, how do I get ideas for what stocks to look at? I'd recommend starting off with something like Motley Fool (www.fool.com) that can help spawn ideas. You might want to eventually pay to subscribe to one of their newsletters, but up to you. Bottom line is they do some good real world education to help you learn to fish, and it's a decent place to get some ideas. You'll start to find other idea sources from there. You'll also want to diversify and get into basic strategies like dollar cost averaging.

Sounds like you're also looking at other investment tools like the retirement account, which is good thinking. Good luck!
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Lakers_2000
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PostPosted: Tue Jul 25, 2006 11:59 am    Post subject:

The best advice anyone could give you right now is to invest in no-load, low-cost mutual funds. And until you know the markets upside-down, stay in mutual funds, or at least until you've educated yourself enough to know what you're getting into when you try to pick individual stocks.

Realize that most of the experts fail to beat the market. Until you can explain to yourself why you'll beat the market when most experts don't, stick to low-cost mutual funds. My 2 favorite companies to invest in are Vanguard and T. Rowe Price. Both companies have a wide selection of good mutual funds at low costs.
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Socks
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PostPosted: Tue Jul 25, 2006 12:21 pm    Post subject:

Lakers_2000 wrote:
The best advice anyone could give you right now is to invest in no-load, low-cost mutual funds. And until you know the markets upside-down, stay in mutual funds, or at least until you've educated yourself enough to know what you're getting into when you try to pick individual stocks.

Realize that most of the experts fail to beat the market. Until you can explain to yourself why you'll beat the market when most experts don't, stick to low-cost mutual funds. My 2 favorite companies to invest in are Vanguard and T. Rowe Price. Both companies have a wide selection of good mutual funds at low costs.


I'd agree with the post, but add that you need to know what your risk levels are and what your goals are. Sounds cheesy, but absolutely helps. Mutual funds are a great addition to an overall portfolio to bring balance, diversification, and steady gains. You might want to make this a part of your overall portfolio, but realize, while mutual funds are less risky, they also tend to be less rewarding. If you're young you may want to take more risk with individual stocks where you have a chance at higher returns. Again, all depends on your goals and how averse to risk you are.
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mike_dee23
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PostPosted: Tue Jul 25, 2006 12:39 pm    Post subject:

Definitely bookmarking all those sites... in that book I mentioned, it said it's good to have a mixture of stocks, mutual funds and bonds. Is that what you guys do?

Any good books I can buy so I can read while on a 5-hour flight?
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Muad'Dib
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PostPosted: Wed Jul 26, 2006 7:02 am    Post subject:

^ "Get a Financial Life" is a good, super-easy-to-read, financial book intended for people just starting out on their own. Covers a little of everything and you can finish it w/in a couple of hours.
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