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Help me get started investing online
Treeloot
Registered User regular
Registered User regular
I want to get started buying stocks. For various reasons I don't want to deal with a real life broker. I want to use the internet to purchase and sell stocks, but I'm not sure what site to use.
The only site I know of for online investing is E*Trade, but it can't be the only one out there. Are there any better sites out there? Is there anything special I need to know before I get involved in stocks online?
The only site I know of for online investing is E*Trade, but it can't be the only one out there. Are there any better sites out there? Is there anything special I need to know before I get involved in stocks online?
Treeloot on
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Get a subscription to the Wall Street Journal, and start reading. Cover to cover, every day. After about a month, you should be ready to start investing.
Don't trade with anything you can't afford to lose. Expect the money you invest like this to be going down the toilet, because at least your first few investments are likely to come out that way. If you're playing with less than $10,000 or so, you'd be better off sticking it in a savings account, where trading fees aren't going to eat it all up. And really, $10,000 is a ridiculously small amount to be trading stocks with on your own; $50,000 is a more reasonable figure.
Or, you could just talk to a financial planner, and stick your money into a mutual fund, or an index fund, and not have to go through all that.
Many mutual funds (read: professionals who are paid to pick stocks) do not beat the market
Amateurs who pick stocks in their free time tend to do even worse
I've been reading through books on investing, so I already know a bit about stocks. I'll definitely consider a Wall Street Journal subscription.
I've got about $5000 want to stick in stocks instead of in my savings account, because in the long run stocks are usually the most profitable investment.
Index funds take an index (like the S&P 500) and invest equally in every stock in that index, then sell shares in the fund which move exactly like that index does. They're a type of mutual fund that's great in a market that's going up.
With $5000, realistically speaking, you aren't going to make any money trading the market on your own. Hell, the Wall Street Journal subscription is going to eat into your investment considerably.
Probably around 6 percent from a savings account, some bonds, or CDs. If it's government bond or FDIC insured, I think your money is pretty much guaranteed safe. Once inflation is figured in your money isn't worth 6% more every year though.
While stocks can be riskier, in the long run they usually give better returns which is why I want to buy some.
Even in the unlikely event I lose all my money buying stocks, I've got plenty of backup money.
they're saying you have too little spare money to make it worth bothering with. better to watch from the sidelines.
I was just pointing out that while you might have 6% more money, with inflation it's not worth quite as much.
I don't see why $5,000 is too little to start investing in stocks. I'm not going to pulling get rich quick trades all the time, I'm going to make a few initial investments and leave them be for awhile. Trading fees shouldn't hurt me too badly.
But if you really want to do it, just do what I said in the first post. Start picking up the Wall Street Journal. Read some of the myriad books on investing in stocks that are out there (though most of them will tell you exactly what I have, here).
Guaranteed investments don’t pay off enough to make it worthwhile. Hell, usually they won’t beat inflation.
$5000 isn’t bad if you plan to buy and hold for a long time, especially since you aren’t trying to get rich and you don’t plan to trade often. I encourage you to go for it–I can’t tell you how many $5000 chunks I wish I had dropped on stocks to hold onto. Christ, I knew what Apple and Nvidia were really worth when they were $10 a share, and if every $10 worth of beer and wine had just gone into Apple and Nvidia I’d be retired already. So keep your wits about you, invest the money, batten down the hatches and you’ll appreciate it later.
Cheap trades can be found at Scottrade.com and they’re happy to handle small sums like yours.
Yeah, and for every Apple or Nvidia, there are 100 Pets.coms, or Enrons. And Scottrade, in fact, charge $7 per transaction, just like my above post.