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Personal Finance Tips - How to Start Investing in the Stock Market

If you are looking for a way to add to your financial security for the future, there are a lot of things that you can do. One of those things would be investing in the stock market. If you have never done this before you will need to learn how to start your own investment portfolio. Just remember that whenever you deal with the stock market you are taking a risk with your money, so it's a good idea for you to learn as much as you can before taking such a big step.

The first and foremost important thing is to educate yourself. You should read about the stocks as well as the market. You should consider taking several seminars or even take a class that teaches investing. You can also go online to a variety of different online financial websites that can provide you with a wealth of information.

You will also need to create for yourself some financial goals and an investment and stock picking strategy. You will need to take time to research different stocks by reading their annual reports, their quarterly reports and any other information there might be on file with the Securities and Exchange Commission. You can also look these up at various websites (Tip: Google freedgar)

Make sure that when you invest that you only invest in the stocks that you have studied and feel that you know. You might want to start by looking into the stocks of companies in your area, companies that you are somewhat familiar with and ones that you might have a little bit of confidence in.

Another thing you need to do is to make sure to check the holdings of some very successful mutual fund companies and if they appear to be doing well with certain stocks then it might be that you could do well with those same stocks.

Make sure that you try to be diversified. You want to try to stay away from investing your money in just a couple of stocks. It's better if you have a handful that you have investments in. When you do start buying your stocks you need to try and find a discount broker to buy the stocks for you, however, if you feel confident in yourself then you might want to just do the investing yourself and you will save yourself from having to pay out any commissions.

Make sure that the stocks you buy you are going to feel comfortable holding onto for 3 to 5 years, you need to try and resist dumping your stocks the minute you see them dipping in price a few points. You need to give the stocks a chance to do something.

Another way you can invest and it's a lot easier for you in the long run is if your company offers any 401(k) plans, retirement plans or Keogh plans consider investing in those. Here you don't have to worry about picking the stocks yourself and there are different tax breaks that come with these types of investments.

Note: Avoid thinking that when you invest your money today that you are going to become an instant millionaire. You need to be thinking of the long term picture not the immediate picture. Besides very few people become millionaires off the stock market, if that were the case everyone would do it. You can however, if you are patient and invest wisely, make a good nest egg for later in life.

Trinidad Partin commented on 22-Feb-2016 09:43 PM
superb. Thanks

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