What resources do you use to learn more about trading and investing?
I first wrote this post on April 12, 2017, more than a year and a half ago. I had just discovered Robinhood, had about $50 of disposable income, and was itching to get started!
I share this post again now to show my first misconceptions and early questions about stocks, trading, and investing. And, hopefully, to track my learning curve in the days to come.
In a follow up post, I hope to adequately answer my own questions.
What do you already know about trading and investing?
Service has always been a part of my family.
It wasn’t something we talked about. It wasn’t tokenized. It wasn’t manufactured. It wasn’t even referred to as service. (Saying it now makes me feel paternalistic). As a result, I’ve never cared much about money.
I’ve been distrustful of those with greater access to critical resources. I’ve been resentful of nepotism that’s led to unequal distributions of wealth, capital, and power. I’ve harbored resentment for institutions and organizations that have denied their privilege vis-à-vis wealth.
But at the heart of it, I’ve never actually cared about money.
Back in April 2017, I started listing all my questions about investing:
- Can anyone invest? Do you have to be a certain age? Can you invest in someone else’s name, like a child or a spouse? (Not that I want to, just asking).
- How much money do you need in order to invest? Can I invest with $25? $50? $100 if that’s all I can spare now?
- If I don’t have very much money, is there a smarter or better money management approach than buying stock? If so, what?
- How or where do I invest? Do I need to call someone and create an account? If so, how do I find someone reputable that I can trust?
- Can I do it online without a broker? If so, what are the caveats?
- What are the “I wish I had known ______ before I started investing” Cliff’s notes?
- Before I start investing, what should I absolutely and completely understand?
- When is a bond better than stocks? What are the benefits of having bonds?
- How do I know what stock is a good one? What resources will help me make smarter decisions?
- If I lose more than I have available in my investment account thingy, do they take it out of my checking account? Or do I just owe more in taxes?
- Is there a certain percentage of any earnings I might make that I should set aside for taxes? How/where do I document any earnings, for tax purposes?
- How often do the best traders buy and sell stocks to turn a profit? Every hour? Every day? Every fifteen minutes?
- Is there a worst time to invest? Is there a best time? How do you know?
Yesterday I learned that there’s an app called Robinhood that you can use to buy and trade stocks.
The benefits most users cite are that you don’t have to pay commissions (fees) on the stocks that you buy and sell.
You can start investing with just $50 (I think less, too). You’re able to buy and sell stocks (but not all of them are available), and you can add stocks to your Watchlist. These are stocks you’re doing more research on, or ones that you can’t afford to buy now, but might be able to afford soon.
One investor recommended setting the amount you plan to use for investing, let’s say $100 to start, but only actually spending two-thirds of that. The other one-third you’d keep in your investment account thingy in case there are fluctuations in the market (i.e. you lose your money!).
Typically stock is more expensive if the company is more reputable or has a longer track record of success. An example would be Google or Amazon. You can do a simple search for stock prices, and this will allow you to see their growth and loss over fixed periods of time.
For example, Amazon stock currently costs $896.23 per share (April 2017).
Today its stock went down 0.68%. When you search for stock prices in Google, you can click on the 5 day, 1 month, 3 month, etc. tabs in order to see the growth/decline of your desired company over time. The charts show that despite its losses today, stock prices over the past year have steadily increased.
A stock that is less expensive might be cheaper because the company is lesser known, or is perhaps from an international source that hasn’t gained traction in the states, or because the leadership and business plan of the company are failing.
GoPro stock, for example, currently costs $8.69 per share (yeah! I can afford that! But maybe I shouldn’t…).
Additionally, a friend recommended that I seek out a more experienced, competent friend or mentor since I have reservations about getting started.
He also said I should commit to X amount of hours per week to spend on research or best practices, and treat it like a part-time job.
Join me! Help me! More to come.