The stock market rules the economy in the United States. Smart businessmen have made hundreds of thousands of dollars off of their investments while the unfortunate find themselves sorely in debt. That being said, learning the ins and outs of how to invest is an extremely profitable skill. The purpose of this article is to give you the insights and knowledge that you need to successfully navigate the stock market.
When to Invest
If you’re just starting your investments, you’ll feel nervous about messing it up. Start small–invest just a little. But start now. Start whenever you have extra funds. Make sure that you save enough to cover your own basic needs but don’t be afraid to put the extra into stocks.
Many experts will say, “Buy low, sell high”. They suggest putting your money into the stock market only when the stocks are in the red and selling only when they’re in the green. The idea is great in theory. If practical, you would be capitalizing on stock at their lowest and selling at optimal points. It would allow you to get the greatest benefit from the market. However, the stock market is up 70% of the time and down 30%. If you bide your time and wait for the 30%, you lose on a lot of the gains that you could have made. That being said, the right time to start investing is whenever you can.
The experts are right when they advise to only sell when it’s red. If you already have stocks invested, don’t sell when it’s dropping. Beginners would argue to sell once the stocks drop and run away with the money that you can salvage. But instead, if you buy more stocks while the market is dropping you will get more high-value stock for much less than you would have originally. Trust that the market will rise–as it eventually always does.
What to Invest In
This topic will encompass the bulk of the article because this is what will bring you the most income. Try to avoid investing in single stocks. They are considered high risk. As an investor, your portfolio will be severely affected if the single stock that you happened to buy drops. Never put all your eggs in just one basket.
Instead, think about it like this: if you had $1000 to invest, would you invest it yourself or would you give it to the top 500 CEOs to invest it for you? The obvious answer is that you would allow the top 500 CEOs to invest it for you. It’s like allowing ClickFunnels to give you a headstart in business. They are already successful businessmen who have an eye for the game of Wallstreet. Let them do their job. This analogy is the S&P 500. It is the top 500 companies rolled into one easy investment. You are betting on their success as a whole rather than narrowing your options down to one. The safest bet is looking into index funds or mutual funds which diversify your portfolio and mitigate losses.
How to Invest
For easy investing, look into finding an investing app that works for you. Here is a list of the top-rated apps for 2018. Explore each of them and find what you like and what you don’t. Some have benefits that would be lost on a beginning investor but that would be helpful for an experienced investor. If you are still hesitant, try a free app that allows for free transfers between the stock market and your bank account.
Most importantly, start as soon as you can. You’ll find that the market is more forgiving than you might originally think.If you enjoy the content at iBankCoin, please follow us on Twitter