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  • Stock Market Investing for Beginners















    What is the stock market?

    The stock market is simply a gathering of people exchanging shares of companies. Shares of companies are issued to raise money for the company.


    Traders vs. Investors

    Traders: Wall Street traders look to make their profits in very short periods of time. Usually in under two weeks.

    Investors: Investors, on the other hand, are willing to hold an investment as long as it continues to be a prosperous and viable investment. This could be years and even decades.





    How do I buy stocks?

    The easiest way to buy stocks is through an online brokerage like Ally Invest, TD Ameritrade, eTrade, and Scottrade. All of those brokerages are pretty good but we always suggest Ally as a more professional broker if you want to invest in the stock market.

    After you have created a brokerage account you'll need to add some money to the account just like you would a new bank account. You can transfer funds from your bank account to your brokerage account via check or ACH wire transfer.

    After you've funded your account you need to get familiar with actually placing an order. It may seem a little difficult at first but this is the easiest part. There are a few basic order types you need to be familiar with when trading/investing in the stock market:

    Market Orders: Market orders are the easiest order type you can use. When a market order is placed, your broker attempts to give you your shares as quickly as possible. They will fill your order at whatever price is available. This method has some downsides like slippage(paying more for the stock than you intended to). This method is more suited for investors who don't have to hassle over a few cents when entering/exiting a stock.

    Limit Orders: Limit orders give you the ability to specify how much you actually want to pay for your stock. This method is more suited to day traders and swing traders
    because every cent matters with these purchases



    Invest in your education

    I am a proficient trader and investor. I did not become proficient by guessing my way through the market or by having "god-given" talent. I studied every resource I could get my hands on. Some free and some paid. I bought every book I could get my hands on from Amazon. I watched hours on end of YouTube videos and read every article and blog about Wall Street. All of those things required an investment of time and money.

    You have to approach Wall Street seriously. One of the things I've noticed about newcomers when it comes to Wall Street is they oftentimes are unwilling to invest in themselves. They sort of think it will all come rushing to them in the heat of battle. That will never happen. Take courses, read books, sign up for newsletters, and read articles. Treat Wall Street with the proper respect and it will show you a clear path to success.

    A Wall Street education is the best education you can get in this day and age considering how most colleges just overcharge and underdeliver.

    Here is a short list of some of the Wall Street books I read when I first began trading and investing:

    Market Wizards: Considered the bible of Wall Street. The author interviewed several top traders and investors and picked their brains to find out what makes them successful. A few of the people interviewed in this book are billionaires. You may not understand all of the terminologies the first time you read it but it will start to make more sense as you get more experience.

    Pit Bull: This book is more for traders than investors. It was written by Marty Schwartz. He is a day and swing trader who has made an absolute killing in the markets.

    How I made 2 million dollars in the stock market: The title of this one is a little hokey but it is a good read. My mentor suggested this book to me so I picked it up. I read the book from cover to cover then quickly put it to use. I bought some shares of Foot Locker using the method described in the book and I quickly made $500. Keep in mind this was in the early days of my career and I had a very small account!

    Those are three of my favorites but you can go on Amazon.com and buy any Wall Street books that catch your eye. There's no such thing as a Wall Street book with 0 value. Even if its just one sentence in the book it can still help. I've read books that only had one line of useful information in them but that information saved me money and headaches over the years.



    Free Resources

    The internet is full of absolutely free information about everything! Wall Street information is no different. I'll give you guys a list of all of the FREE resources you can use when trading and investing. Keep in mind I still use all of these resources on a daily basis.

    WallStreetForum.net - I'll start with our own website because the site is filled with TONS of FREE advice. The forums are free to sign up for and once you've registered you can start asking questions and engaging in discussions with other traders and investors. You can even message me personally if you have any questions.


    FINVIZ - Finviz is a great FREE service that lets you do as much research as you want to. There is seriously nothing you can't research on this site when it comes to Wall Street.

    FreeStockCharts.com - The name says it all.

    Investopedia - Bone up on your financial terminologies


    How do I know which stocks to buy?


    There are two basic ways to approach the stock market. Fundamental and technical analysis.

    Fundamental analysis: Fundamental analysis is a method of determining a stock's value by looking at complex factors like
    a company's financial statements, the economic climate, and global impact of the world issues on the industry that company is in. This method is used more by long-term investors than traders because fundamental factors can rarely be acted on in a short-term position. Fundamental analysis is the method employed by Warren Buffett, the most famous investor in the world.


    Technical analysis: Technical analysis takes a simpler approach to Wall Street. It basically assumes that every known factor about a stock or currency is known at the time that you are looking at it. I would say this is the most popular method of determining a stock's value but that doesn't mean its the best. The best method is what works for you.

    Learning to evaluate stocks on your own can be extremely difficult in the beginning so I oftentimes tell casual traders and investors to sign up for stock picking newsletters. Stock picking newsletters are a great way to boost your confidence when trading and investing.

    Here are a few good stock picking newsletters that you can sign up for today:


    Beat The Market Analyzer
    Trader HR




    Dividend Stocks

    Dividend stocks are the most passive way to approach the stock market. Dividend stocks basically pay you an extra amount on top of the traditional gain that you would get from any stock.

    Top Dividend Stocks is a great service that researches the best dividend stocks and recommends them to subscribers.





    Can I make a full-time living from Wall Street?

    Yes. Everybody has a different objective when they enter the world on finance. Some people just want to be secure for retirement. Some people are looking for a little extra income and some are looking to buy a Lamborghini and a penthouse in Miami. There's nothing wrong with either of those objectives but if you're looking for the full-time income you'll have to approach the market like you would any job.

    I am a full-time professional stock trader and investor. The stock market occupies at least 10 hours of my day, every day. I do market research every night including weekends. Every Friday night I look at a few thousand stock charts. I'm looking for anything that may be promising for the next week's trading. That scan usually narrows the list of stocks down to under a thousand. That entire process takes a few hours. That's just my Friday scan. I also do a shorter version of that Monday through Thursday.

    The point is I treat my trading like what it is. A job. My job is better than most people's job because I do it from home and on my own terms. Plain and simple.







    What are my tax implications?

    Paying taxes on your Wall Street gains is actually pretty simple. All online brokerages issue their customers a 1099 tax form around tax time and you can give that form to any local tax prep place like H&R block & Jackson Hewitt. If you feel like you want a tax prep person who specializes in trader taxes you can try Mann & Company CPA's.

    No matter what route you choose please make sure you are dealing with a reputable preparation establishment that offers liability protection.







    If you guys have any questions or need clarification on anything in this article please respond and I and the other members will do our best to help.
    Platinum Swing Trade Alerts (FREE 14-Day Trial)

    Best Stock Picking Services


    Sign up for the forum to reply to this post!!!


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    Stock Market Investing For Beginners

    "Step into the arena and hold on to your hat. Don't get discouraged if you don't make 8 trillion dollars in your first month. Trading is not a get rich quick scheme. Realize that trading is a skill and just like any other skill it takes time to learn. Have convictions in your decisions in life and trading. Ignore the comments and "advice" of those that have never traded a day in their life."


    Terms Of Service

    DISCLAIMER:
    This website provides information about the stock market and other investments. This website does not provide investment advice and should not be used as a replacement for investment advice from a qualified professional. This website is for informational purposes only. The Author of this website is not a registered investment advisor and does not offer investment advice. You, the reader, bear responsibility for your own investment decisions and should seek the advice of a qualified securities professional before making any investment.

  • #2
    Thanks so much for this. I just started a couple months ago and its a lot to take in. I'll be hanging around the site too! Thanks again.

    Comment


    • #3
      Originally posted by Craig Lewis View Post
      Thanks so much for this. I just started a couple months ago and its a lot to take in. I'll be hanging around the site too! Thanks again.
      Welcome to the site!
      Platinum Swing Trade Alerts (FREE 14-Day Trial)

      Best Stock Picking Services


      Sign up for the forum to reply to this post!!!


      Best FOREX Signals Software

      Stock Market Investing For Beginners

      "Step into the arena and hold on to your hat. Don't get discouraged if you don't make 8 trillion dollars in your first month. Trading is not a get rich quick scheme. Realize that trading is a skill and just like any other skill it takes time to learn. Have convictions in your decisions in life and trading. Ignore the comments and "advice" of those that have never traded a day in their life."


      Terms Of Service

      DISCLAIMER:
      This website provides information about the stock market and other investments. This website does not provide investment advice and should not be used as a replacement for investment advice from a qualified professional. This website is for informational purposes only. The Author of this website is not a registered investment advisor and does not offer investment advice. You, the reader, bear responsibility for your own investment decisions and should seek the advice of a qualified securities professional before making any investment.

      Comment


      • #4
        great read. how have I not found this site until now?

        Comment


        • #5
          Thanks for the article. I'm still new to this whole wall street thing but I've been reading all I could and studying everyday

          Comment


          • #6
            welcome maggie
            Platinum Swing Trade Alerts (FREE 14-Day Trial)

            Best Stock Picking Services


            Sign up for the forum to reply to this post!!!


            Best FOREX Signals Software

            Stock Market Investing For Beginners

            "Step into the arena and hold on to your hat. Don't get discouraged if you don't make 8 trillion dollars in your first month. Trading is not a get rich quick scheme. Realize that trading is a skill and just like any other skill it takes time to learn. Have convictions in your decisions in life and trading. Ignore the comments and "advice" of those that have never traded a day in their life."


            Terms Of Service

            DISCLAIMER:
            This website provides information about the stock market and other investments. This website does not provide investment advice and should not be used as a replacement for investment advice from a qualified professional. This website is for informational purposes only. The Author of this website is not a registered investment advisor and does not offer investment advice. You, the reader, bear responsibility for your own investment decisions and should seek the advice of a qualified securities professional before making any investment.

            Comment


            • #7
              Good read. Thanks for posting

              Comment


              • #8
                Nice article.

                Comment


                • #9
                  It is always nice when you see the money rake in. Don't get greedy because that is when you will find yourself holding the bag.

                  Comment


                  • #10
                    Very true Cindy. Welcome to the site!
                    Platinum Swing Trade Alerts (FREE 14-Day Trial)

                    Best Stock Picking Services


                    Sign up for the forum to reply to this post!!!


                    Best FOREX Signals Software

                    Stock Market Investing For Beginners

                    "Step into the arena and hold on to your hat. Don't get discouraged if you don't make 8 trillion dollars in your first month. Trading is not a get rich quick scheme. Realize that trading is a skill and just like any other skill it takes time to learn. Have convictions in your decisions in life and trading. Ignore the comments and "advice" of those that have never traded a day in their life."


                    Terms Of Service

                    DISCLAIMER:
                    This website provides information about the stock market and other investments. This website does not provide investment advice and should not be used as a replacement for investment advice from a qualified professional. This website is for informational purposes only. The Author of this website is not a registered investment advisor and does not offer investment advice. You, the reader, bear responsibility for your own investment decisions and should seek the advice of a qualified securities professional before making any investment.

                    Comment

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