| What is investing? | | | | help you get a basic idea of stock investing. OK, so |
| Investing is a broad term that can mean a lot of | | | | you got some basic info about investing in stocks. It |
| things. You can invest in stocks, bonds, real estate, | | | | is time to learn how to buy shares of a stock. |
| cars, education, etc. There are investments that | | | | Buying a Stock |
| appreciate (gain value over time) or depreciate (lose | | | | Let say that you decided you wanted to buy some |
| value over time). I am referring to the ones that | | | | shares of Microsoft (MSFT). The first thing you |
| appreciate over time. These are the investments | | | | would want to do is find out how many shares you |
| that will create wealth for you. The perfect definition | | | | want. Then you take the current share price of the |
| for this is taken from dictionary.com, "To spend or | | | | stock and multiply it by the amount you want to buy. |
| devote for future advantage or benefit". We want | | | | There are many places you can look to see what |
| to invest in things that are sure or most likely going | | | | the share price is. Did you know that Google will |
| to bring us future gains. Still with any investment | | | | recognize most ticker symbols if you just enter them |
| comes risk, and we will talk about that later. | | | | in the search box? Try it! Ok, so now you know the |
| Investments That Appreciate | | | | amount you need to spend to buy the shares you |
| Real Estate - History has shown us that real estate | | | | want. The next thing you need to do is place a trade |
| tends to gain value over time. You can be pretty | | | | with your online broker. |
| sure to get a return when investing in real estate as | | | | IMPORTANT NOTE: Most stock markets are only |
| long as you take care of the property. | | | | open between the hours of 9:30AM and 4:00PM |
| Stocks - Stocks are probably the riskiest of the 3 | | | | Monday through Friday. |
| but stocks can be safe if chosen wisely. | | | | When you place a trade with your broker they will |
| Education - Education is risk free. You always get a | | | | do all the paperwork in the background to purchase |
| return on learning more. If you study which berries in | | | | the actual stock from the company for you. This is |
| the wild are poisonous, then you will probably never | | | | why there are broker fees. Fees differ between |
| die from poison berries. Getting a degree can get you | | | | brokers. Shop around. The trade will usually go |
| into better jobs, etc. | | | | through in one day and you will now have a partial |
| Investing In Stocks | | | | ownership of that company. If the company does |
| The main investment focus of this blog is about | | | | well you will do well. If they don't do well then the |
| online things. You can invest in product websites, | | | | value of your shares may fall. Not to fear, there are |
| advertising, blogs, stocks, domains, and more. I would | | | | a whole bunch of stocks that will go up and down in |
| like to go into a little detail on how to invest in stocks | | | | a short period of time but will do well over the long |
| online. Owning stocks is literally buying partial | | | | term. |
| ownership of a company. To buy stocks online you | | | | The Risk |
| need to open an account with an online broker. I | | | | I mentioned that we will talk about risk later on well, |
| personally use Sharebuilder. The reason being is | | | | the basics of risk are simple. High risk means there is |
| because it is very simple, cheap and focused on long | | | | a higher chance you will lose money from the stock |
| term investing. There are no fees and minimums and | | | | and low risk means there is less risk you will lose |
| there is no penalty for non activity. With Sharebuilder | | | | money. Controlling risk is a very key element in |
| you can also purchase partial shares of stocks and | | | | investing. There are various different strategies for |
| have the dividends invested for free. I have been a | | | | minimizing risk. The most common and easiest one is |
| member of sharebuilder for a few years now and I | | | | to diversify. To diversify, means to buy a mixed |
| like it. | | | | group of stocks with different levels of risk. This will |
| Basic Stock Terms. Here is a list of basic terms | | | | decrease your chances of losing money. |
| involved with stocks and their definitions, in plain | | | | A Personal Note Regarding Risk |
| English. | | | | When people hear "risk" they think "loss". I try not to |
| Ticker - The unique symbol used for a company on a | | | | think about it that way when investing in stocks. It is |
| stock exchange. For example, Microsoft's ticker | | | | not like gambling. You are not just betting on a |
| symbol is MSFT. | | | | number. You are betting on a company. This fact |
| Share Price - Price you have to pay to buy 1 share | | | | makes me think differently about risk. I think about |
| of stock. | | | | risk as a potential for gain. Don't be afraid, if you do |
| Shareholder - A person who owns shares of stock in | | | | your homework you will have little to worry about |
| a company. | | | | when investing. |
| Commission Fees - The fee you have to pay to | | | | * THE MOST IMPORTANT THING TO KNOW |
| place a trade to buy stock. | | | | ABOUT STOCK INVESTING * |
| Dividends - A cash payout from a company to its | | | | There are many resources out there to help you pick |
| shareholders. This payment is based on the amount | | | | stocks. Don't listen to any of them unless you do |
| of shares you own, the price of the stock and the | | | | research for yourself first. Luckily for me when I was |
| dividend amount. The payment is usually every | | | | in college we had a class on E-commerce which |
| quarter. | | | | talked about the best online business models to |
| Risk - The probability of losing money from owning a | | | | follow. They mentioned a company of self made |
| stock. Risk is usually classified as Low, Medium and | | | | millionaires called The Motley Fools. They went in full |
| High. Or Conservative, Moderate and Aggressive. | | | | detail of how they were successful in their online |
| Volatility - The amount of price activity of a stock. A | | | | business of picking stocks. I have been using them |
| stock, whose price goes way up or way down daily, | | | | ever since and trust their advice. Their philosophy is in |
| is volatile. You can guess what not volatile is, right? | | | | long term value investing, which is a much less riskier |
| Prospectus - A detailed financial document a | | | | style of investing. |
| company publishes, for shareholders to see what | | | | Conclusion |
| they are getting their selves into. | | | | Well there you have it, the basics in stock investing. I |
| Bear Market - A time when the stock market | | | | hope this page gives you a basic understanding of |
| consistently drops. | | | | stocks and how to buy them. Please feel free to |
| Bull Market - A time when the stock market | | | | contact me with any questions about investing or |
| consistently rises. | | | | comments on this page. Let me know if there is |
| There are many more terms used but these should | | | | something I missed or should add. |