I am thinking of investments like funds or stocks. Do you know any good readings or information that can guide me on how to invest money. I'm thinking of trading online but i'm thinking on how i can assure returns or how i can know the ins and outs. I also want to try mutual funds or anything related to it.
So any valuable information or guide will surely help me. Thanks! I am thinking of investments like funds or stocks. Do you know any good readings or information that can guide me on how to invest money. I'm thinking of trading online but i'm thinking on how i can assure returns or how i can know the ins and outs. I also want to try mutual funds or anything related to it.
So any valuable information or guide will surely help me. Thanks!
I'm still young (early 20's) and i want to practice saving as early as now with the money i'm earning. Can you also tell me which to prioritize in investing? funds, stocks, bonds? which should i go invest into first? I admire your thinking. If you start young, passive income producing investment vehicles is an excellent choice. Most currently have favorable tax treatment and if you reinvest the distributions over the next 20 to 30 years, you will be looking at some big bucks when you retire.
Personally, I would subscribe to a few financial magazines. Kiplinger's is my magazine of choice. Fortune and Forbes are good as well. I've never read Money magazine, but most serious investors I know don't really care for it too much (not sure why as I haven't read it). I'd recommend subscribing to at least two of the magazines. If you are new to investing, I'd just read for about a year to get various investment ideas and develop a stragegy before dumping all your money into the market.
Anyway, there are essentially three paths you can go:
1. Private investment: I assume you are not a mutli-millionaire with a ton of cash you can afford to lose, so I wouldn't recommend private investment. This is where investors place money in businesses (usually start-ups) that are not publically traded. The risk is high, but so can the payoff
2. Pick your own stocks and bonds: You could do your research and choose a few stocks and/or bonds that appeal to you. Some stocks have very high dividend payouts (some in excess of 10% of the stock price). Currently, some companies that make money off of the energy industry have some great payouts. Coal companies seem to be an overlooked sector (especially with the large number of planned coal electric plants that are under review to be built over the next decade) that are offering some very attractive dividends. Oil tankers is another industry that is making a ton of money due to the high demand for crude that are offering some great dividend returns. The problems with choosing your own stocks or bonds is that most people don't have enough money to get a nicely diversified portfolio. Also, there are multiple stock analysists for each stock in America. Chances are you are not going to outguess Wall Street and do better than the professional stock traders (which brings me to choice 3).
3. Mutual Funds: As I mentioned, America is full of stock analysists and they have access to information and tools that you and I could only dream of. Unless you really know what you are doing, I'd advise you to go the mutual fund route. Personally, I am a fan of Vanguard and T. Rowe Price as they both offer competitive funds with low costs, few fees (if any), and usually with no-load. There are mutual funds that whose strategy is to invest in only high dividend stocks. You can also invest in an income or a growth and income fund (income funds aim to provide a stable fund that provides passive income, usually for retirees. Growth and income looks for dividend income as well as try and grow your principle). If you want to have a more stable investment, you could invest in high-yield bond funds. These are funds that invest debt of companies (or goverments) with questionable credit ratings. The funds have a higher risk of the borrow defaulting on the loan, but the passive income from the fund can easily be between 5% and 7%. High-yield fund can either be corporate (taxable) or municiple (the distributions from the fund have prefered tax treatment. Typicially the distributions are tax-free on the federal level. The state tax laws determine how much of it is taxed on the state level).
Like I said, if you are new to investing, subscribe to a few investment magazines and read for awhile to get a feel for investing. I advise most people to go the mutual fund route. There is nothing wrong with choosing your own stocks and bonds, but it is a ton of work and most people are doing nothing more than guessing.
Good Luck to you! real state is the way dude Well established companies that pay dividends and have a history of dividend increases could fill your bill.
If you want to do more research I suggest
http://www.morningstar.com/
Another thing, I recommend the book by Jeremy Siegel, "The Future For Investors."
. Online trading can be risky. I have dabbled in this for fun and I never really got ahead. I invested a couple thousand dollars and after fees, I think at best I broke even. You really need 10 or 20 thousand dollars to turn a decent profit after fees and taxes.
Another thing is to remember that you will never be assured returns. There are no guarantees in investing. The few you find come with a price tag. Take a Certificate of Deposit for example:
You get a 5% return annually
Inflation is generally around 3%
Now your 5% return is only worth 2%
You still have to pay taxes on the 5%
At the end of the year your investment grew by less than 2%, this is not a good return. But if you want a guarantee, this is about as good as it gets.
Savings bonds are even worse. They have a less than 4% return. After figuring inflation in, they earn you less than a 1% return.
Stocks and Mutual funds are the way to go for any decent rate of return. While you are just beginning, consider sticking to index funds. They rise and fall with the market. What wall street does as a whole is what you do. Over the long run they have always gone up.
Morningstar.com has been a good resource for me. They have useful information there.
If you are say in your 30's or younger you should strongly consider aggressive growth mutual funds. They are more volatile, but have proven to be very worthy investments as long as you are young enough to roll with the ups and downs.
Also remember that fees kill. You will be much better off researching a bit and buying for long term gains. If you keep moving your investments you will be eaten alive with fees. It depends on how much risk you are willing to take. Also, it sounds like you want liquidity, being able to get your hands on the money quickly. However, in most cases, you're better off in the long run if you hold on and don't sell.
I suggest that you invest in high quality individual stocks or in No-Load mutual funds.These are least risky of any in the stock market. First, learn all you can about the stock market. Look on the internet and in your local library for information. Set some goals.
Avoid "penny" stocks, and "high flyers" and the latest hot mutual funds. These are too risky and there's less than a 5% chance of any reward. go to subjex.com check it out, tell them dad sent you. If your goal is income I recommend buying mutual funds which pay a monthly or at least quarterly distribution. Gabelli has several funds which meet this criteria. Most fund family's have several funds which meet these goals.
Another option to explore is Closed End Funds. I'm not a huge fan of closed end funds but some of them pay very nice dividends. For closed end funds I would only buy well managed funds and when they are trading at a discount. (The market price of the fund is less than the NAV (Net Asset Value)). Closed funds can be illiquid hence I would plan on holding them for sometime. i had invest in stock for years now and will share with you what i think is important. first of all, you need to understand what and how the stock market work. by then at least you have the general picture the way to go in stock.
secondly, it is very important to define your ultimate goal. there are nothing wrong either investing in bonds, stock or real estate as long as it fits your needs. otherwise, you'll regret back to where you are now after spending money and time down the road. strategic asset allocation is very important as it helps diversify your money within acceptable risk but profitable return (e.g 50% for long-term, 30% for medium-term, 20% for short-term)
some consider to invest for long-term while others prefer to only trade the stock. well, i did both cos both has it own strengths. i love the feeling of buying things out of short-term stock's profits which is not found in long-term investing. of course i don't have the crystal ball, but as long as you master the techniques, you'll be able to reduce the losses if not making more money. the key is, take advantage of any opportunity that you see made available in the market as both bull and bear are benficial and profitable especially to individual investor; if you know how to act.
last but not least, train yourself for an investors mindset and behaviour. you can read all succesfful investors like Buffet or stock traders like Soros have high very high mindset and behavior. but before investing, remember not to be greedy. greed is the utmost enemy for investors. and secondly, do not invest just because you have the money!! sometimes it is better to just keeping your money under the pillow than putting it in stock and losing it the next day. i found this is the major problem of new stock investor cause they get tempted very easily after listening others making much money in stock market.
hopes it helps, and good luck. Open a brokerage account at Zecco and invest in Altria. Hi, here is a collection of informative articles about investing. a free online investing tutorial for you.
http://www.investingtutorial.info/
good luck !
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