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-   -   Beginning to Invest (http://archives2.twoplustwo.com/showthread.php?t=273947)

bighomage 06-16-2005 01:31 AM

Beginning to Invest
 
I'm 18 and I've just recently decided to put some money in the stock market. I have about 1000 dollars invested in Walmart and I'm looking to invest another 1000 in something else. I was thinking about Best Buy, but I think I might have missed the boat by about a week for some of the biggest gains. I think I might wait for price to come back down.
Anyway, as young as I am, should I be investing in proven companies like Walmart, or should I be gambling on some smaller technology stocks hoping for big time gains.

Also, if you haven't figured out already, I'm pretty much a novice at this. I've read a couple of basic books, but I still don't know what to look for in a winning stock. Any tips and/or books, sites, etc. that I could benefit from would be greatly appreciated. I'm basically just asking for some help to get me started in the right direction. Thanks.

z80x86 06-17-2005 02:45 AM

Re: Beginning to Invest
 
I'm in a similar position. Are there any good books on how to invest in the stock market I could study?

My bankroll might still be too small to overcome the effect of commisions, but never to early to start learning.

MiguelSanchez 06-17-2005 05:09 AM

Re: Beginning to Invest
 
Great job starting young. While you do have the leeway to take a riskier investment approach, I would still focus on proven, stable investments for a while until you learn more about investing in small-cap stocks or growth stocks.

With that in mind, don't worry too much about whether you missed a stock by a few weeks. You should be looking long term, and in the long run a few percentage points just won't matter. When I was just starting out, I looked at a 5-10 year window that I would hold stocks unless something drastic happened. It's worked out well for me so far.

Look for stocks that provide dividends, especially if they look cheap. With only $1000, you don't want to be trading too much, so a direct investment plan would be a perfect fit. Check out http://www.dripinvesting.org/drips.htm for some good info.

Once you have some money ($5k or so) in some good proven companies or maybe an exchange traded fund or two, and have spent some time learning about how to read financial statements and do some number crunching, you can think about putting the next $1-2k in some riskier plays. That way you have a steadily growing portfolio with the possibilities of some really big gainers. Use Scottrade or something like that to get low commissions and start looking at 1 year time frames for those picks.

James Boston 06-17-2005 10:33 AM

Re: Beginning to Invest
 
[ QUOTE ]
any good books on how to invest in the stock market I could study?

[/ QUOTE ]

My library is as follows (although I haven't read them all yet):

One Up On Wall Street - Peter Lynch
Securities Analysis - Ben Graham
Intelligent Investor - Ben Graham
Essential Buffett - Robert Hagstrom
Expectations Investing - (can't remeber off the top of my head) check Amazon

michiganfan9 06-17-2005 12:13 PM

Re: Beginning to Invest
 
"The intelligent investor" by Benjamin Graham

michiganfan9 06-17-2005 12:16 PM

Re: Beginning to Invest
 
Expectations investing is written by Alfred Rappaport, Michael J. Mauboussin

gvibes 06-18-2005 08:31 PM

Re: Beginning to Invest
 
[ QUOTE ]
[ QUOTE ]
any good books on how to invest in the stock market I could study?

[/ QUOTE ]

My library is as follows (although I haven't read them all yet):

One Up On Wall Street - Peter Lynch
Securities Analysis - Ben Graham
Intelligent Investor - Ben Graham
Essential Buffett - Robert Hagstrom
Expectations Investing - (can't remeber off the top of my head) check Amazon

[/ QUOTE ]

This would be a good list if you want to pick securities - if average is good enough for you (like it is for me), check out:
Malkiel - Random Walk down wall street
bogle - common sense on mutual funds (and some others)
Bernstein - the four pillars of investing

tek 06-19-2005 09:43 AM

Re: Beginning to Invest
 
If your question is what individual company should you put $1000.00 in long term, I would say Medtronic (MDT). It's a solid company that plugs away and splits quite often.

Sniper 06-19-2005 12:16 PM

Re: Beginning to Invest
 
With only $1000 to invest, you might look into Dividend Reinvestment plans that allow you to buy shares directly from major companies, bypassing broker commissions.

You can find more info about this type of investing at dripinvestor.com

imported_bingobazza 06-19-2005 01:51 PM

Re: Beginning to Invest
 
When you say put some money into the stock market...do you actually mean that you want to learn to invest? There are bonds, property, commodities and derivative to chose from as well as other vehicles. Sometimes, stocks perform poorly for long periods, while other asset classes do well. Its great to start young, and my advice is not to limit your invesmtent universe to stocks. Other opportunities come up all the time. Read 'Tomorrows Gold' by Mark Faber, as a general overview of the investing universe. He also runs a superb website with an monthly newsletter that will educate you well over the years. Also read 'Extraordinary popular delusions and the madness of crowds' by John McKay I think.

www.gloomboomdoom.com.

good luck

Bingo


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