“MY NAME IS ED BURKE.I WON HALF A MILLION DOLLARS IN THE CNBC MILLION DOLLAR PORTFOLIO CHALLENGE.
CLICK HERE TO FIND OUT HOW I DID IT.”
There are many ways that a person can invest or trade in the stock market. Some screened for stocks based on criteria that they set up or they follow those set up by investment gurus. Having done that there will be some who will buy and hold those stocks for a short period of time or for a long time. Then there will be those who called themselves traders. These are the people who, based on their own analysis of the stock, will zoom in to buy those that they think may go up in price. When proven correct, they will allow their profits to run till the day that they think the stock had run up too much. That will be the time they sell their stocks.
The following article which I found on the internet, however, talks about investing in stock funds. For those new to trading and who are not sure how to go about investing, it will give you some basic understanding on stock funds (some may even use index funds, but that is another topic). Those who already may have some experience in investing, it is good to just have a read too.
Article: Stock Investing Guide For Beginners By James Leitz Platinum Quality Author
Stock investing is where most investors make most of their investment profits. If you are new to the stock investing game and have not yet honed your money management skills, this simple investing guide will help you make your first stock investment by simplifying things for you.
A stock investment can take more than one form. You do not need to open a brokerage account and pick your own stocks to invest in. Instead, you can invest in stock mutual funds and leave the money management and stock picking to investment professionals.
Stock funds offer diversification and professional money management at only a moderate cost to you. To keep costs low, invest in no-load stock funds.
Now, you'll need a basic investing guide to assist you in picking stock funds to invest in. To broaden your diversification, you may want to invest in 2 or 3 different funds. There are basically 2 main criteria for picking stock funds.
First, does the fund invest mainly in large-cap, mid-cap, or small-cap stocks? Second, does it emphasize growth stocks, value stocks, or invest in both (this would be labeled as a "core" or "blend" fund)?
You now have 9 basic stock investment categories (3X3, above) to chose from. For example, you might start investing with a LARGE-CAP, BLEND stock fund. Then, you might add a MID-CAP, GROWTH fund for diversification.
Now, some definitions. A large-cap stock is one like General Electric or Wal-Mart. To get a stock's market capitalization (cap) you multiply the number of shares a company has outstanding times the market price of each share. This (the market cap) gives you the total market value of the company. Mid-cap stocks are stocks in companies with a smaller total market value, and small-cap stocks have even lower total market value.
Growth stocks are a stock investment in companies that are growing sales and profits at a faster than average pace. Investors buy growth stocks for price appreciation (hoping the stock price will rise significantly) ... not for dividends.
Value stocks are a stock investment that is more modestly priced (lower P-E ratio) and/or pays a higher dividend vs. most other stocks. They are often bought because they appear to be under-valued (maybe a bargain).
Thus, a LARGE-CAP BLEND fund invests in stocks with large stock market values ... both growth and value stocks. A MID-CAP GROWTH fund invests primarily in growth stocks of smaller companies (in terms of market cap).
In picking stock funds, here are your 9 basic choices for general diversified stock funds: large-cap blend (core), large-cap growth, large-cap value, mid-cap blend, mid-cap growth, mid-cap value, small-cap blend, small-cap growth, small-cap value.
Generally speaking, large-cap blend or value funds are safest. Small-cap growth funds are the riskiest, but can have excellent growth potential in a roaring bull market.
Parting words from Tompreneuer: In order to be successful in the stock market, an investor or trader needs to know what his objectives are when they invest or trade. This particular area will be followed-up in a later blog posting. As usual, I would like to caution those new to investing to be cautious until they are sure of what they are doing. By then, by all means invest in the stock market. For more information on stocks investment visit Quick and Easy Guide On Investment. Good Luck
“MY NAME IS ED BURKE. I WON HALF A MILLION DOLLARS IN THE CNBC MILLION DOLLAR PORTFOLIO CHALLENGE.
CLICK HERE TO FIND OUT HOW I DID IT.”
Article Author Background:
A retired financial planner, James Leitz has an MBA (finance) and 35 years of investing experience. For 20 years he advised individual investors, working directly with them helping them to reach their financial goals.
Jim is the author of a complete investor guide, Invest Informed, designed for average investors or would-be investors of all levels of financial background and experience. To learn more about investments and investing and his new financial guide go to http://www.investinformed.com
Article Source: http://EzineArticles.com/?expert=James_Leitz
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