Think investing is a minefield? You’re not alone. If you’ve never invested before, it can be difficult to find your way – a bit like parenting. If you want to grow a healthy, full investment – you’re going to need some help. Get some advice on what to expect when investing to start you on an easy journey towards investment success.
When you’re new to investing, there will be a lot of words that are unfamiliar to you, but it’s important that you learn what they are to stop you making a costly mistake right at the very beginning. Some terms you might find useful to know before you get started include:
Stock is essentially the ownership of a business. There are two main types of stocks: common and preferred. Individuals can buy stock from a company, entitling the holder to a portion of the company’s profits.
A commodity is a product that can be sold and bought. It’s possible to invest in commodities like gold, oil and even agricultural commodities like coffee.
Mutual funds relate to a portfolio made up of multiple investors that is run by a portfolio manager. They are structured differently to individual investment accounts, and investors will receive a report each year outlining performance, etc.
A stockbroker is either an individual or a company who will trade stock on behalf of clients. It’s not necessary to work with a stockbroker to trade.
A brokerage account
A brokerage account is the account you will use in which to trade stock. You can read more about how to open a brokerage account here to help you get started with trading on the stock market.
Going solo or using a stockbroker?
These days it’s much easier to start trading by yourself. You can open an account easily online, deposit the funds and start trading. However, if the thought of being let loose on the stock market frightens you, you might want to consider leaving your investment in the hands of an experienced stockbroker. While this doesn’t make your investment any safer, it can help you out if you’d prefer not to get caught up in the details of trading. Take a look at the ways you can trade without using a broker to find out more about the options available to you.
Choosing the right trade for your needs
There are different types of trades available to you, and it’s not always a ‘one-size-fits-all’ approach to deciding the best investment type for you. While investing in stocks may seem like the easiest route because it’s the one you’re most familiar with, you might want to consider investing in something else instead. If the thought of investing in commodities has piqued your interest, this review by Lawrence Pines could help you learn more about the types of companies that are out there to help you invest. You might find that investing in stocks or commodities isn’t for you at all, and that property is a much more appealing option to help you grow your assets.
Gaining confidence in investing
Investing in stocks requires a certain degree of risk, and you’re going to need to develop confidence quickly to navigate this unfamiliar territory. Growing confidence in your trading takes practice, and not always trusting your gut. At times you’ll want to make a snap decision to sell because of a poor trading day, when it may not be the wisest move at that time. Making mistakes in trading is inevitable, but you’re going to need to learn to ride them out to become a better trader.
Start taking an interest
One of the ways investors find success is by keeping up to date with what’s happening in the news. Reading money news and the latest events happening in business is an easy way to help you make better decisions when it comes to buying and selling, and help you start to recognize current trends. Set up alerts on your phone or to your email to make sure you stay up to date with the news stories affecting the companies you’ve invested in.
The world of investing can be difficult to get to grips with, but you’re certainly not on your own. Take advantage of the many resources that are available online and speak to professionals about your options. The more questions you can ask, the better, to help you find your feet and become an expert trader in no time.