Your Questions About How To Invest In Stocks

Laura asks…

How do you start smart investing in stocks?

I was told to do stock options over investing in stocks? Yet,I find the risk factor is too high in options. So I rather invest more in stocks and see what type of outcome manifests itself. What would be the first step? Besides going on these sights like Etrade etc. Is wall street still open for the little guy? Please help!!!

John answers:

The first step is to educate yourself. There are many books on investing (Investing for Dummies?), and many, many online sites that can help. Every major investment company has a web site with educational info (Schwb, Vanguard, Fidelity, T Rowe Price). Also every mutual fund company. Most novice investors start with money markets and mutual funds. See for info and fund evaluations.

You need to understand a) the risk of whatever you invest in. There are different kinds of risk, and EVERY investment has SOME kind of risk, even Treasuries.
B) how the investment works: will it produce interest income, dividend income, capital gains, tax writeoffs? How valuable each of these is to you depends in part on your tax bracket and what your goals are (how far along in life you are–are you investing shortterm and need money in x years or months, or are you investing for your children’s education or for your own retirement?) Don’t invest in anything you don’t understand!
C) if someone is selling this product to you, what is their commission? Some products cost 7% upfront. This reduces the amount that is actually invested. If you are buying online, what is the per-trade commission? Are cheap commissions important to you, or is it more important to have a person you can talk to and ask questions of? This will determine WHO you invest with.

Here’s a web site with lots of info:

And here’s a picture of the “investment risk pyramid”, showing least risky investments, going up to the most risky investments.

Good luck to you!

Lisa asks…

How can i start investing in stocks?

How can i invest in stocks, either through someone, or by myself? where can i go, what do i do, and how much money should i have? Is there a website that i can go to? How long shuld i leave my money in there, years, months? the list of questions goes on!

John answers:

This is a question which is complicated to answer…:-)

The first thing you need to do is open an account where you can buy stocks. You can go thru a site like, or, or, they are all great, big names and will handle clients from everywhere (don’t know where you are based). You can also check with your local bank if they will “attach” a stock buying account to your checking or savings account, they are called brokerage accounts-this might help to.

Watch out for commissions in buying and selling stocks. That’s why internet brokers like are great, they are cheap to trade.

Then comes to hard and fun part. How to make money.

The bad news-statistics are against you. Most people lose money in the stock market.

The good news-the ones who do make money-get to keep it all.

There’s lots of investing strategies, etc. One really good “stock” is the symbol SPY-in one shot you buy 500 big companies listed on the New YorK Stock Exchange.

Go to sites like,, they have lots of information on trading stocks.

You can also take some classes for trading stocks.

A good overall site is . Lists some must visit sites for a trader.

You should probably have a minimum of $2000 (US) to make it worthwhile to play the market. Otherwise, commission costs will be too big a percentage and you will lose all to your broker (normal commissions are $10-$20 for a buy or sell order).

You can leave your money for seconds, minutes, days, years…..This is what trading is.

Good luck,

Mandy asks…

How is it possible to get rich investing in stocks for 5 or more years?

Can you invest in stocks for 10 or 20 years and make great profits? If I invested $1000 in MSFT and forgot about it, than 20 years later looked at it and it’s worth $1,000,000, is that possible? What is your opinion on small-cap stocks? Solar Energy stocks? Etc stocks?

John answers:

First off, Solar Energy stocks are having a hard time in my opinion due to the not so great global economy. It is a risky stock to invest in.

It is possible to make money in Microsoft stock if the market conditions are favorable to the company. Be sure to do lots of research regarding the company before you commit to the investment.

Small Cap stocks can be good and bad. Sometimes the small cap stocks don’t get anywhere. Sometimes they are companies on the verge of success. Do lots of RESEARCH on the company and the industry it is in. Lots of companies come and go that promise great returns and success to their investors. Be sure to read up on the industry and see how the smaller companies fair in the overall industry.

If you invest for the long term then take at least time once a quarter or semi-annually to evaluate your stock portfolio to make sure that your stocks are in good shape. Don’t just forget about it for 10-20 years. That may prove to be unwise if you are depending on this to be a future safety financial cushion for retirement.

Best of Luck to you!!!!!

Joseph asks…

Can a non US citizen invest stock in US?

I am an international student studying economics in UCLA.
I currently have an address and will acquire social security within a month with school employment.
I heard rumors that contrast such as

you have to be either a US citizen or a permanent resident in order to invest in stocks.
you can invest in stocks if you have a social security number.

I do not have a trustworthy source to find out the truth.
So, in sum, what’s the requirement for stock trading procedure in United States?

John answers:

YES a non US Citizen can invest in stock in the United States

YES a non US citizen can open a brokerage account with a broker/dealer in the United States

You will have a US identification number, either a Soc.Sec, or a work id, both are acceptable by the US securities industry

Call the broker/dealer that you are considering using for your transactions, and they will verify the above. I had many non US citizens as clients in my firm and never had any regulatory or tax problems

Good luck, invest/trade well & welcome to the US

George asks…

How to invest in shares in a different country?

I want to invest in NCSoft, the creator of the game called Guild Wars and the upcoming Guild Wars 2. They have a korean stock, how would I go about investing stocks in different countries such as the UK and others like Korea?

John answers:

Hi there. If you want to invest in shares, in a different country, you will have to find a broker from that country and buy the stocks through them. This website is very helpful for buying shares in different countries. Http://

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