3:02 am on January 28, 2010
Hi, I am 20 years old and am looking to start investing into the stock market. I have been told that I am too young to invest and that I will end up broke. I am going to be an accountant, so I know how to handle my money. Also, I was curious if there is a minimum to invest at a time or if I can invest a small amount now and invest more once I have established myself? And finally am I too young to invest?
Donald F 3:02 am on January 28, 2010 Permalink
I am glad that you are asking this question at your age. Like in everything else in life, there’s nothing like starting early. You are studying to be an accountant, so you already know the power of Compounding, and what it can do. Consider this excellent article about the benefits of starting early and what Compounding can do for you, when you start early.
Power of Compounding
http://www.valueresearchonline.com/story/h2_storyView.asp?str=4007
Next, I would recommend you to first get solid grounding in Investing. 3 must read books. If you haven’t heard of these, buy them NOW, today. They will be your invaluable guides to safe & prosperous investing and future wealth creation.
1. Intelligent Investor -Benjamin Graham
Considered the bible of all investors, this will foremost teach you the basics and most importantly, how not to lose money. Thats the first lesson you need, believe me
2. One up on Wall Street -Peter Lynch
This is another classic. Tells you how to spot winners from what you see around you. successful products, companies. Practically shows you how you do not need to be a hot shot financial analyst to be able to spot good moneymaking opportunities in stocks
3. Common stocks Uncommon Profits- Phil Fisher
As you dabble for 1 or 2 years, make some money and also make some small (hopefully) mistakes, you will start itching to catch the multi-baggers, the ones that go up 4x-10x in a couple of years! This book show you how to sift out probable winners
As you start reading the books, start an online trading account like someone mentioned e-Trade, use the principles in the first book to buy a few good stock at a reasonable price. Start listening in on the financial channels, start reading a business daily, daily. Check out great investing basics websites like
http://beginnersinvest.about.com/
http://www.investopedia.com/articles/basics/
http://www.kiplinger.com/moneybasics/
And ask questions to the more experienced investors at popular forums, hang in lurk at some of the great investing forums for pearls of wisdom and when you have a query that you have to have answered post a quick one. Consider Chucks Angels -a nice yahoogroup for wannabe investors too http://finance.groups.yahoo.com/group/chucks_angels/
Good Luck. You are not too early by any standards. I would say just about right time. Get cracking, boy!
Eka A 3:02 am on January 28, 2010 Permalink
When the stock market have got into bullish.But it up to the economics,although perhaps economics slow down but you can get profit in bearish.it up to your skill.I will show you and example that present you about the US recession can’t effect to everyone,thus you can make progit on this situation. here this link
http://finance-fantasy.blogspot.com/2008/05/us-financial-crisis-has-not-had-bad.html
cashing 3:02 am on January 28, 2010 Permalink
Try <— http://earn-cash-today.com/stock
Good luck!
jjunit 3:02 am on January 28, 2010 Permalink
"I have been told that I am too young to invest and that I will end up broke."ha ha ha thats funny im 16 and i invest in stock options
Liz A 3:02 am on January 28, 2010 Permalink
You can invest at any point in your life and start with small amounts if you like. There are alot of different investment options out there so study up on it first and see what fits for you. If you go with stocks, remember the old saying "buy low – sell high"
To start, go to you local bank and talk to an advisor. They can give you some good option advise for free, that’s their job. Of course they would like you to invest through them, but you don’t have too.
andy 3:02 am on January 28, 2010 Permalink
When I was in the Navy, there were people your age investing in the stock market and making money. If you have spare money and can handle the risks go for it. I would start with an online stock trader such as e-trade to get your feet wet. It usually takes a few hundred dollars to get started. Good luck and happy investing.
Ray 3:02 am on January 28, 2010 Permalink
Anytime is good to invest. Your age is NOT a factor if you understand the marketplace and it’s ramifications.
There is no minimum – but you need to understand you pay commission per trade and buy the stock at it’s current market price.
And hope the price goes up. Then you sell it for profit.
However, there are also stock options you can trade as a tool to hedge your investments.
You should also look at futures trading as a tool for investment and hedging.
In the futures market (also called "commodities"), you can buy OR sell without ownership. You are "betting" or speculating the price of gold, or crude, or sugar, or wheat will go up OR go down. Much riskier than stocks, but you can make a lot of money in a short period. (you can also loose it just as fast!)
You can use a broker who will offer advise or trade yourself online- like schwab online.
However, it is the your responsibility to do the research.
What type of stock and the companies you invest in will determine your chances of success.
Dump it all on one stock or smaller amounts in a few different stocks? These are some things you will have to decide.
Also- DO NOT listen to people who give you TIPS. Chances are, by the time you hear the "hot tip", it’s too late. Someone else has already cashed in.
Watch the movie Boiler Room. IT will teach you a good lesson- how you can get scammed by what appear to be legitimate brokers.
DO YOUR HOMEWORK FIRST before you give anyone a cent.
Good Luck-
Sheri Dev 3:02 am on January 28, 2010 Permalink
Ziggy,
Investing in direct equity market without proper knowledge is risky. Till achieving the required knowledge, you can select mutual fund path by applying SIP (systematic Investment Plan) with best available funds today. that is recommended.
Still, you want to know about the time buy stocks, please read further.
There are two types of activities with share and stock. 1. Stock trading 2. Stock Investing.
Stock traders commonly buying stocks today and selling immediately the same day or next day to get small profits. This is dangerous for someone doesn’t have proper knowledge. The method most of the traders using to analyze a stock called Technical Analysis using trend and historical performance charts. It is a kind of speculation that can give you money or cost you money.
Stock Investing also same but, investors throughly analysis companies using various fundamental analysis tools and once they found a good one, the will invest on that. compare with the above, stock investing have long term investment perspective of 5 to 15 years. This will give them proper profits time to time from there in vestment.
Now about the time to invest:
There is a basic approach seeing that, buy stocks in low and sell at high. This is OK but you have to watch a lot and have skills to identify the stock moves.
The best time is to buy stocks is "Any Time" you want. But if you buy stocks at any time, you have to follow some criteria.
- First, you should have a long term investment perspective of 5 to 10 years.
- Second, you should study and analysis companies to know whether the stock of this company is suitable to invest or not. to analyze a company, great investors like Benajamin graham and warren buffett provided some valuation methods. read the same here: http://uliponline.blogspot.com/2008/05/ten-points-ben-grahams-last-will-and.html if the company is suitable to this valuation methods and your investment horizon is long, buy the shares at any time not considering the market status and hold the shares. You will certainly get handsome profit.
Best wishes and go ahead.
gampublic 3:02 am on January 28, 2010 Permalink
Two things first: Generally, I’ve found accountants great with tax forms/laws, not so hot as investors, so beware of overconfidence. Second, you’re asking how to time the market, and history and study after study shows no one is worth a darn at it over time.
So the short answer is "A soon as possible *when* you know what you are doing". Here’s my stock answer to investing rookies. Two suggestions:
1. Get professional advice from a fee only financial planner. Someone who sells advice – NOT products on commission like a stockbroker does. Fee Only Planners have no reason to give you anything but their best advice, since they want you to be happy and refer friends. And their compensation isn’t tied to what you invest in, eliminating conflicts of interest as much as possible. I think this makes sense in the same way it makes sense to hire a mechanic to fix your car – you just don’t want to spend the time and effort to figure it out for yourself. This is the most expedient method, but is more expensive out of pocket, than DIY, much like a mechanic. It still should be much cheaper than a stockbroker’s loads, fees and commissions however.
Full disclosure, I am such an advisor.
-or-
2. Do It Yourself – Read Books – for investing, my favorite authors are Larry Swedroe, Rick Ferri, William Bernstein, and John Bogle. Basically, they skip over the “pop finance” garbage (most media) that’s simply a distraction, and get down to real professional quality investing while still being accessible to most reasonably intelligent people. You will find this has nearly nothing to do with accounting as you study it. If you don’t mind spending the time to figure it out right, and are interested in the topic, this is a perfectly good choice, and less money out of pocket.
Your Call. Good Luck.
brckr1 3:02 am on January 28, 2010 Permalink
best time was about 2 months ago, or when the market was low. your not too young to invest, just talk with a brokerage firm or your bank…do alot of research first…..then wait….you may not make money fast but if you invest in good companies and look to the future………look at alternative energy stock, wind, solar, fuel cells, companies thet reclaim waste and those that turn waste emissions into energy…GRGR.PK on the NYSE….TMG.V,APV.TO and SBX.V all on the TSX………read what T. Boone Pickens has announced………
http://investing.hirby.com/when-is-a-good-time-to-invest-in-the-stock-market/
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Have a good day.
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