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Online Stock Investing

Online Stock Investing

Next Generation is going to lead a better life than the previous generation - Warren Buffett

Investing Idea

Want to Invest like the Greats? Take a look at the Strategies these Big Guys used to Earn their Names:

Warren Buffet



Warren Buffet is considered a value investor. Essentially, he selects stocks that are priced at a significant discount to what he believes is their intrinsic value. When Buffett buys stocks, he buys them for keeps. This requires a lot of discipline: it’s hard to resist buying or selling when the market seems perfectly ripe to act.

Buffet views the stock market as temperamental. He doesn’t panic when stocks plummet, or celebrate when they skyrocket. Instead, the Oracle of Omaha maintains the “keep calm and carry on” mantra, only buying stocks he intends to hold indefinitely, if not forever.

Peter Lynch



Lynch is also a value investor who stresses fundamental analysis . Lynch’s bottom-up approach involves focusing on an individual company, rather than the entire industry or the market as a whole. The idea here is that what really matters is the quality and growth potential of a specific company, regardless of whether the industry is underperforming or even in a tailspin.

Here are 3 additional Lynch stresses when looking at a company from the bottom up:
:- Good research pays off
:- Shut out market noise
:- Invest for the long term

Philip Fisher



Philip Fisher was a growth investor. He consistently invested in well-managed, high-quality growth companies. He would hold on to these for the long term. His famous "fifteen points to look for in a common stock" were divided up into two categories: management's qualities and the characteristics of the business itself.

When Fisher found an investment he liked, he wasn’t afraid to take an outsized position of the stock within his portfolio. In fact, Fisher sometimes downplayed the value of diversification. He often found himself scouring the tech sector because the pace of c hange there creates an environment that is ripe for disruptive innovations.

finding-good-stocks-for-investing-online-stock-investing

Finding Good Stocks for investing

Finding Good Stocks for Investing



Within each stock sector, the ultimate goal is to find the stocks that are showing the greatest price appreciation. In the same way that one would pay attention to sectors, multiple timeframes should also be examined to make sure the stock in question is moving well over time. There are two main things to keep an eye on when selecting stocks:

:- Liquidity - It isn’t smart to invest in a stock that has very little volume. What if quick liquidation is required? Selling it at a fair price will be extremely difficult if not impossible. Unless you are a seasoned trader, invest in stocks that trade at least a couple hundred thousand shares per day. Save yourself the headache.

:- Price - Trade in stocks that are at least $5. Don’t shy away from a stock just because of its high price. Don’t buy a stock just because of its low price.

Investing your money for the first time is a big step. In this guide, our experts will help you get off to the best start.

Consult with us today

Tips for Stock Market Investing

Here are several tips that should be followed by beginning investors.



Set Long-Term Goals

Why are you considering investing in the stock market? Will you need your cash back in six months, a year, five years or longer? Are you saving for retirement, for future college expenses, to purchase a home, or to build an estate to leave to your beneficiaries?
Before investing, you should know your purpose and the likely time in the future you may have need of the funds. If you are likely to need your investment returned within a few years, consider another investment; the stock market with its volatility provides no certainty that all of your capital will be available when you need it.



Avoid Leveragee

Leverage simply means the use of borrowed money to execute your stock market strategy. In a margin account, banks and brokerage firms can loan you money to buy stocks, usually 50% of the purchase value. In other words, if you wanted to buy 100 shares of a stock trading at $100 for a total cost of $10,000, your brokerage firm could loan you $5,000 to complete the purchase.
The use of borrowed money “levers” or exaggerates the result of price movement. Suppose the stock moves to $200 a share and you sell it. If you had used your own money exclusively, your return would be 100% on your investment



Understand Your Risk Tolerance

Risk tolerance is a psychological trait that is genetically based, but positively influenced by education, income, and wealth (as these increase, risk tolerance appears to increase slightly) and negatively by age (as one gets older, risk tolerance decreases). Your risk tolerance is how you feel about risk and the degree of anxiety you feel when risk is present. In psychological terms, risk tolerance is defined as “the extent to which a person chooses to risk experiencing a less favorable outcome in the pursuit of a more favorable outcome.” In other words, would you risk $100 to win $1,000? Or $1,000 to win $1,000? All humans vary in their risk tolerance, and there is no “right” balance.



Control Your Emotions

The biggest obstacle to stock market profits is an inability to control one’s emotions and make logical decisions. In the short-term, the prices of companies reflect the combined emotions of the entire investment community. When a majority of investors are worried about a company, its stock price is likely to decline; when a majority feel positive about the company’s future, its stock price tends to rise.
A person who feels negative about the market is called a “bear,” while their positive counterpart is called a “bull.” During market hours, the constant battle between the bulls and the bears is reflected in the constantly changing price of securities.



Handle Basics First

Before making your first investment, take the time to learn the basics about the stock market and the individual securities composing the market. There is an old adage: It is not a stock market, but a market of stocks. Unless you are purchasing an exchange-traded fund (ETF), your focus will be upon individual securities, rather than the market as a whole.
few times when every stock moves in the same direction; even when the averages fall by 100 points or more, the securities of some companies will go higher in price.



Diversify Your Investments

Experienced investors such as Buffett eschew stock diversification in the confidence that they have performed all of the necessary research to identify and quantify their risk. They are also comfortable that they can identify any potential perils that will endanger their position, and will be able to liquidate their investments before taking a catastrophic loss. Andrew Carnegie is reputed to have said, “The safest investment strategy is to put all of your eggs in one basket and watch the basket.” That said, do not make the mistake of thinking you are either Buffett or Carnegie – especially in your first years of investing.