Your Questions About How To Invest In Stocks

Susan asks…

If a person has $1,000 to invest in stocks, what kind of broker would you reccomend? What company?

What approach should a person take? I know that you have to pay the broker a commission. A person has to pay a fee. So, how does a person make money off of an investment? I am not talking about mutual funds. I am interested in individual stocks. Thanks.

John answers:

Scottrade are pretty good. Http://www.scottrade.com . You can always transfer your shares to another broker if you find a better one. You need a minimum of $500 to open an account with Scottrade, so if you have $1000 that shouldn’t be a problem.

There’s only two ways to make money:
1. Buy low and sell high
2. Buy stocks that pay quarterly dividends and continue to hold to accumulate dividends.

Use charts and financial statements when selecting stock. The media and people in places like YA aren’t always honest.

Look for stocks listed in one of the following 3 indexes.
Dow Jones (30 Stocks): http://finance.yahoo.com/q/cp?s=%5EDJI
S&P 500: http://finance.yahoo.com/q/cp?s=%5EGSPC
NASDAQ 100: http://finance.yahoo.com/q/cp?s=%5ENDX

For research on a stock:
http//:www.yahoo.com/finance

I’d rather let you pick your first stock.

Mark asks…

How to invest in stocks for beginners?

I really know nothing about stocks. So can someone help me out?

John answers:

Just visit your local library and read a few stock trading books – have a look at this –
http://beginnersinvest.about.com/od/stocktrading/tp/guide-to-investing-in-stocks.htm

John asks…

Does anyone ‘invest’ in stocks anymore or is it all trading to make a quick buck?

Correct me if I am wrong, but a long time ago people used to invest in stocks and hold them for a long time. Nowadays people just buy and sell to try and make a quick buck and screw other people and the markets in general. This is just a perception I have and wanted to know if anyone had a different viewpoint or insight. Maybe an old timer who can tell me how it used to be. Maybe I am wrong and its always been the same.

John answers:

Investing has always been about making money….

From 1980 to 2000…the Dow Jones Industrial Average went up 1,200 % (yes that’s one thousand two hundred percent)

From the year 2000 to 2010 currently….The Dow is about -10%

You think those buy and hold investors in the 80’s would have done more buying and selling today?

Markets have always gone through cycles that seemed to endlessly repeat. Unfortunately, only Connor ‘The Highlander’ MacLeod has been around long enough to see them all.

Note …I profited from Buy and Hold Investing in the 90’s and I am profiting from Buy/Sell mentality of today’s markets. I don’t fight the market. I like being on winning teams. I suspect, that those who insist on staying with buy & hold will not have much capital left to enjoy the era (and that day will come) when buy & hold makes a comeback.

Signed…Connor MacLeod

Lisa asks…

Can you invest stock in the New Jersey Nets?

Can you invest stock in individual NBA teams?

John answers:

Privately you could approach bruce ratner sure. Its not a public company though

Green bay packers are the only pure play publicly traded sports franchise.

Indirectly, the NY Rangers and Knicks (Cablevision), Seattle Mariners (Nintendo), and the Toronto Blue Jays (Rogers Communications).

Donna asks…

Which countries have the most reliable legal principles when a US investor wants to invest in their stocks?

Meaning if you decide to invest some stock, which countries are fair, reliable, honest, etc with your investment, and which ones are too corrupt to invest stocks in?

John answers:

Whoa… Some other answerer chose China as a safe place, and I’ve got to disagree with that. China is ruled by laws, but property rights are a new concept there – particularly for foreigners – particularly those w/o billions of dollars and ties to the Chinese government. My advice: be careful in China. (good news is, as a foreigner, you can’t even buy on the Shanghai exchange)

My opinion: The US, UK, Canada are good. Then at a very slightly small step down: Australia, NZ, Western European countries… And Japan. Then: South Africa, Brazil (Argentina used to be here). Then: Peru, China, India. Then:Russia, middle eastern countries.

It’s important to know a little about geopolitics for stuff like this, because some places have a history of screwing investors (and their populations at the same time), and some, based on current policies, may not have a history, but have a risk.

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