Your Questions About How To Pick Stocks

John asks…

Stock Market Game—-Good Stocks?

im in the stock market game at my school……I was wondering if anyone could tell me what stocks would be worth wile investing in…..i want to win…..websites would help to

John answers:

Here’s what I learned:
1] Follow the stocks in sectors and industries in those sectors, which are currently performing well. You can do this by gong to smartmoney.com

2] Trees don’t go to Heaven. Neither do stocks.

3] You not only have to pick stocks, you have to follow those stocks you pick.

4] You should do some preliminary investigating. Read about stocks at investopedia.com This is a free site.
Investopedia.com is also considered a
“knowledgeable contributor” to Y! A.

5] There are LOTS AND LOTS of articles and books you could read about investing in stocks. Another good site is yahoofinance.com

Thanks for asking your Q! I enjoyed taking the time to answer it!

VTY,
Ron Berue
Yes, that is my real last name!

Helen asks…

Stock MArket ??

I need to know how to invest in the stock market game, I do have some money but I don’t know how to start, and i need to know how do companies rates affect me,, and why there’s Nasdaq and other’s what do they mean ??
sorry I’m so dummy about this.. but there’s a first time for everything right ?

John answers:

I strongly recommend mutual funds to beginners like yourself.
Picking individual stocks it just too risky and requires serious analytical skills to do right.

Charles asks…

whats the best way to start getting into stocks?

i wanna start getting into stocks, but idk where to begin. im a college student and i dont have alot of money, but i heard when planned right u can make alot of money off stocks, over a course of a few months.
soooo where to begin?
any other tips or advice about stocks would be awesome thank you

John answers:

To Start Investing
It takes a long time to learn the stock market and it would help if you read some books and information online. Before you start investing in the market the first thing you need to decide is what risk level you want to take. CDs backed up by the government has about 3-4% annual return for the long term with a low risk. Bonds or Bonds Funds has about 5-7% annual return for the long term with a medium risk. Stocks or Stock Mutual Funds has about 8-10% annual return for the long term with a high risk and are more volatile than Bonds. Usually the more risk you take, the more return you will have, but not always. To see the Risk vs Return go to my photo at: http://i1223.photobucket.com/albums/dd520/jjmarcantell/RiskvsReturn.jpg If you can’t see the Return vs Risk table, let me know and I will send it another way. The stock market is basally made up of stocks and bonds. Investment managers pick a group of stocks to make a mutual fund or a group of bonds to make a bond fund. They even put a mixture of stocks and bonds together and call it Growth & Income Fund.

1- Mutual Funds: I like mutual funds because they have a group of stocks, could be around 100+, invested in different sectors, and manage by a professional. Managers have lots of schooling for investing in stocks, around 8 years. So I think managers can pick stocks better than me. There are lots of different kinds of mutual funds that does not charge any fees to buy it’s shares and they are called Noload Funds. There are also some funds called Load Funds that charge 5% of your investment. But what I don’t like is the fact that most funds has trading restriction and you may not be able to trade more than 4 times a year. That’s because it makes it hard for the fund to make a good return if there is to much trading in the fund, causing the fund manager to make more buys and sells. Mutual funds are meant for long term investors.
2- Stocks: Stocks is more volatile than funds unless you spread you money in about ten different sectors and know witch sector will do best. And stock trading restricting is only a few days and that’s something that I like. If you own stocks, you need to keep up with all the company’s business so you don’t get stuck with a bad stock.
3- ETFs (Exchange Traded Funds): ETFs are like a mutual fund but trades like a stock and that is my main reason why I like ETFs. There are some ETFs that represents Index’s. An Index is like S&P or DOW. Index’s operate just like a mutual fund with a group of stocks in deferent sectors, manage by professionals. You can’t buy Index’s because they are not for sell. A company owns them. But you can buy a mutual funds or an ETF that has the same stocks as the Index they represent. There are a lots of different kinds of ETFs for someone to choose from. Some have 1x leverage, some have 2x leverage, and some has 3x leverage. There are some that represent almost every kind of sector.

You can find several good brokers that charge $8.00 and under, per stock trade and no fee on Noload Funds. Most broker websites have good research tools. Some popular broker websites are Fidelity, TD Ameritrade, E-trade, Scottrade and others. I think you need a min. Of $500 (some sites $2,500) to open a broker account.

If you want more info, click my picture and read About Me.

George asks…

How do you buy stock?

I’ve been reading the book, rich dad poor dad, and i got paid today.. i want to buy some stock. don’t have a clue? can someone please gieve me step by step info. please!!!

John answers:

I see you are interested in investing in the stock markets and you read the same book I read 8 years ago. Start trading stocks is as simple as opening a trading account with no minimum investment amount and then picking a stock for as low as $100 and then buy. You need to buy through a broker, there are no way around this. However, that simplicity is truly the wolf beneath the sheep’s skin.

There are quite a number of things you need to learn before you can even start thinking of the stock markets …

1. You need to understand how the stock market works and what it is exactly about.

2. You need to know what are the different styles of trading in stocks and shares.

3. You need to read about why so many people lose their shirts in the stock markets so that you can avoid their mistakes and also decide if this is a risk you want to take.

For all these issues and more, you can read about them from some of the articles that I wrote at http://www.mastersoequity.com/articles.htm

After you are adequately armed with the basic concepts and ideas, you need to know how to find profitable stocks to trade or invest in. You can do that the easy way by subscribing to stock pick services (example http://www.stockpickmaster.com ) or you can learn to use charting tools and softwares to find stocks with parameters that you can pre-define. (example http://worden.mastersoequity.com/)………

Remember, the slogan “Just Do It”, Just won’t do for the stock markets. If profiting in the stock markets is as simple as buying a single stock , then why are so many people still poor?

After you have all the above mentioned knowledge, you need to ask the following golden questions before you can decide whether a stock is worth buying or not :

1. Why are you of the opinion that this stock will rise?

2. Is your opinion valid in the first place?

3. When are you expecting it to rise? Can you hold on for that period of time or longer?

4. What is your expected entry price? After what price would your expected profit margin be too thin to enter upon?

5. Where is your expected stop loss point? What is your stop loss point based on? Where will you tell yourself that it is time to take a loss and get out?

6. Where is your expected profit taking point? What is your profit taking point based on?

7. Does the way you are buying the stock allow you to hold on until your expected profit taking point?

8. How much of your money should you dedicate to this one trade?

9. What is the level of primary, secondary and idiosyncratic risk you are undertaking when deciding how much of your fund to use?

10. What is your cashflow need? Does your cashflow needs allow you to hold the full lifetime of the stock?

After you are able to answer all these questions confidently, THEN you are ready to… PAPER TRADE your stock strategy. Yes, even at this point, you are NOT READY to trade for real. You should trade on PAPER for at least 6 months and become consistently successful BEFORE you take your stock strategy into real life.

Then.. You are ready to start… But there is still no guarantee of success as paper trading is very different from real trading. You will need another maybe 1 year or 2 trading very little money and be consistently successful BEFORE you are ready to increase your stakes.

So, as you can see, success in the stock markets is not easy at all the the less knowledge you have, the more risk you undertake. I lost hundreds of thousands in the stock markets before I become successful.

Take heed and good luck.

All in all, investment and trading is a lifelong education and non stop learning. No one is ever done learning and catching up with changes in the markets.

If you care to read about how I went from completely broke to retired millionaire trading stocks and options by 28 years old, you can go to http://www.mastersoequity.com/

In conclusion, what I am saying here is that trading stocks and investing for profit is a professional game that takes years and a lot of money to learn, so it is not something that someone in need of college fees should do … Now…. But you should certainly start to learn about it right now.

Hope these information helps.

Http://www.optiontradingpedia.com/

http://www.mastersoequity.com/

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Mandy asks…

is motley fool a good place for stock picks?

winning stock picks are,ticker-(nuan),(rsti),(praa)

John answers:

It’s the best place online for any kind of financial advice, not just Stock picks…. Another good place (for the UK market at least) is http://www.everyinvestor.co.uk

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