Your Questions About How To Pick Stocks To Buy

George asks…

How To Start Investing In Stocks Now?

Say I had done all my research and now I’m ready to start making my picks on stocks.
How do I get started now? Where do I go to start buying and selling stocks?
I’m not seeking financial advice, say I just want to get into the stock game now and start buying and selling on demand.

John answers:

Another way to start investing with a small amount of money is to sign up with something like [link url=http://www.sharebuilder.com/]ShareBuilder[/link] through ING Direct. For as little as $4 you can create an automatic investment plan that will help you start building your portfolio. Keep in mind that they may impose some account restrictions and fees, but generally speaking, it’s a great way to start investing today without much money.

Donald asks…

Is it possible to Invest in individual stocks for a traditional IRA account?

Up to this point I’ve invested in Vanguard index funds for my traditional IRA account, but this year I thought I might try picking out individual stocks to feed the traditional IRA account. Is this allowed? Also any advice about how I actually go about buying these individual stocks? Many thanks in advance for your help!!

John answers:

Yes, you can invest in stocks (or ETFs or many other securities) using an IRA (unlike a 401k where this is not allowed).

You’ll just have to set up a IRA brokerage account. I have accounts at both Sharebuilder (super low stock trades) and Schwab (not as cheap but great customer service), for example, and they work well. Just be sure to choose a brokerage firm that won’t charge you a fee for keeping your IRA with them. Few do charge such fees now a days.

You could use Vanguard for your brokerage account, but I don’t reccommend it. I love Vanguard and they are a great mutual fund company. But their brokerage fees (the amount you pay to buy a stock) are on the high side. The only exception to this would be if you had a lot of money with Vanguard and would then be eligible for lower fees. Here’s a link: https://personal.vanguard.com/us/accounttypes/brokerage/ATSIntegrityValueContent.jsp

Here’s the link for Schwab’s fees: http://www.schwab.com/public/schwab/home/fees_commissions?cmsid=P

and Sharebuilder’s: https://www.sharebuilder.com/sharebuilder/fees/default.aspx

Mary asks…

Should I Invest into Stocks? ?

Okay, so I’m currently 16 years old and I have a couple thousand dollars in the bank that I don’t really need. ( I own a internet business) Instead of having my money sitting in my account doing nothing, I wanted to know if it would be a good idea to buy 2-3 grand in stocks.

Right now stocks are very very cheap and being my age, I’m obviously in it for the “long run”

So, would you recommend I buy stocks? If I invested 3 grand into stocks (which my dad would probably pick for me because he knows his stuff and I’m pretty clueless about stocks) how much do you think that 3 grand would be worth down the road?

Or…

Is investing such a small amount of money just a waste of time?

John answers:

No investment is a waste of time. Choose wisely. You may have to get your parents to sign off as you are under 18. But I’d buy some stock for you at my firm, held in street name, no margin until you are 18.

Now, are you trading it? Buy and hold? Income? College? Why? Answer those make a plan and reach your goal.

Paul asks…

Any experts help on the stock market?

I am currently new to the stock market and have not really done anything with it before. I was wondering if anyone could give me some ideas to get me started in the stock market because I am aware that the market is obviously done right now, therefore I want to buy stocks at cheaper prices but I am not sure how it all works, which 1’s are a smart pick, and how much I should invest in each stock. Help!

John answers:

We are , or will be starting a rally very soon. To trade stocks you need a broker. You can sign up online with www.tdameritrade.com or www.scottrade.com. Before you buy a stock, you need a strategy. To get a strategy, you will need to read a book. I suggest Wallstreet Money Machine by Wade Cooke. (Cheap on www.amazon.com). His system works. Electronic trading is the same as a full service broker, but much cheaper. Make your own stock picks. Once you have a strategy, finding stocks that meet your strategy is where the work is. Two good sites to look at stocks in in your yahoo browser under finance. Another good site is www.bloomberg.com. Third site is www.clearstation.com. Warning!!! This market rally will be fast and furious. You can make a lot of money. BUT, all the spending the Obama is implementing, will hit us hard before the end of the year. I suggest getting all your money out by Sept. 15. The one rule in stock trading that never loses is: Buy low and sell high. Good luck. It costs about $10. To buy or sell a stock. The software is user friendly. You add the stock symbol eg: F for Ford. You will get the symbol from the sites above. Put in the quantity. Eg: 100 shares Price $2.00 and the type of bye. Market…that will execute at the next sale. Or Limit you name the price. If you choose market, you will not put in the price.

Jenny asks…

Could you please tell me how these stocks would do????? HSE ( Husky Energy), DVN(Devon), COP(ConocoPhillips)?

Hey guys!!! please tell me your honest opinion as to how these stocks would do? and if they are a good pick for this year by looking at the P/E ratio and dividends and volume etc????? This is my first time buying stocks and am eager to invest $1000 in something I can trust. I have never done stokcs before and could you also TELL ME HOW TO BUY THEM???? WHATS THE EASIEST AND FASTEST WAY TO BUY THEM?????? any website???? PLease honest opinions would be appreciated!!!!!!

John answers:

Those oil stocks are good long term investments in my opinion. If however you are going to invest only $1000 I do not recommend investing in those stocks. Too much risk. Instead I would invest in a decent mutual fund or index fund. Much less risk. You can buy the mutual fund directly from the mutual fund company if it is an open ended fund. A closed end fund or ETF index fund, you will need to purchase through a stock broker.

An ETF index fund that has done well is IWN.
Closed end funds that have done well and are not too risky are SWZ and GAM. More risky: TDF, and IIF and CHN.

My favorite mutual funds all have minimum purchase amount above $1000 but one family of funds to consider with low minimum purchase amount of $250 is American Funds.

You can open an on line brokerage account with Scottrade with a $500 deposit minimum or OptionsXpress with no minimum.

If you do not mind the possibility that you may loose 25% of your initial investment this year go with one of those oil companies. Over the long term 5+ years you should do ok. A somewhat safer investment in a particular stock would be BAC or JNJ or LOW. All trading at near record low prices and all considered investment grade.

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