Your Questions About Investing Tips

David asks…

I need some tips in investing in LOW cost stocks and funds?

I’ve been in a few mutual funds for several years now and made quite a bit of money with them. my financial advisor has advised me to sell them on the basis that he believes I have milked them for all I’m going to get, anyway what i’m looking for is either low cost (by low costi mean less than $1 per share) stocks or funds that i can research and possibly purchess?

John answers:

Before you go giving your money to advisors you met in a chat room, you need to look up the basics of stocks, and bonds.

Check out what fundamental statistics are for each.

Like the price to earning ratio for stocks (P/E) gives you an idea of what kind of return you could expect….for instance a P/E of 20 says you will pay $20 for every $1 you expect in dividends for that stock….so if the stock costs $100 you can expect about 5$ annually in dividents……This is not guaranteed!!!!

Bonds have a divident yield. Thats the interest rate they expect to pay at maturity.

You can buy into good stocks and bonds by using mutual funds. The entry is cheaper and you have more options.

Carol asks…

Investing tips for a starter.?

I have heard a few guys around the office talking about investing in the stock market using Scottrade and other investing agencies and making thousands of dollars in just a year. I have been getting increasingly interested in this and would like to do some investing of my own to make a few extra bucks. Does anyone have any tips for me for starting investing? Thanks in advance.
Happy Independence Day!

John answers:

Before you enter into any transaction, you should first know what you’re doing, why you are doing it and how to do it and the rules relating to what you are doing.

Before you invest in any security, the first investment you should make is in yourself, and the best investment you can make is by educating yourself.

Start your education by learning why you should invest and the importance of being able to make your own decisions or how the pro’s make theirs.

Here is some reading material that can get you started in the right direction,
What Works on Wall Street by James O’Shaunessey
Beating the Street by Peter Lynch
One Up on Wall Street by Peter Lynch
The Warren Buffett Way by Robert Hagstrom
How to Make Money in Stocks” by William O’Neil
24 Essential Lessons for Investment Success by William O’Neil
Your Money and Your Brain by Jason Zweig
The Interpretation of Financial Statements by Benjamin Graham
The Intelligent Investor, by Benjamin Graham
Common Stocks, Uncommon Profits, by Philip A. Fisher
Stocks for the Long Run, by Jeremy Siegel
Bulls Make Money, Bears Make Money, Pigs Get Slaughtered, by Gallea
Trading for a Living, by Alexander Elder
From Riches to Rags, by I.C. Freeley

Get into the habit of making daily visits to some websites like MSN Money and Yahoo Finance. (http://moneycentral.msn.com/home.asp , http://finance.yahoo.com/ . While at MSN following the strategy lab analysts to get a feel for what the pros are doing and why. This site has some basic information for beginners. If any site offers free information, take it.

Other website that can provide instructions and help with procedures and terminology are Investopedia – http://www.investopedia.com/ Stock Charts – http://stockcharts.com/
http://www.investorshub.com/ http://www.1source4stocks.com/,
http://www.tradingstocksguide.com/tradin…

Visit some of the more professional websites like Zacks – http://www.zacks.com/ Smart Money – http://www.smartmoney.com/ Schaeffer’s http://www.schaeffersresearch.com/ Some of these web sites will have advertisers who are worth looking into also. And remember, if they offer free information, get it.

Attend all the free seminars you can, just be careful and don’t get pressured into anything you really don’t want or need. Most schools offer courses in finance and economics, but very few will have courses on the mechanics of the investment markets, if they do try taking the course. You may want to consider on-line courses, the New York Institute of Finance use to have such courses. Try to get some fee information from the stocks exchanges they all have (had) free booklets, SIAC and some of the regulators (FINRA SEC MSRB CBOE) may provide some free literature.

You at least have made the right decision to start investing, this is the first big step and it won’t be your last. Keep taking those steps forward and along the way never take the advice from people that are not in the market or try to tell you not to invest.

Good luck on your journey

John asks…

What are some tips for first time investing in the stock market?

Is not a good or bad time for investing stock? how much expect do I need to invest, i wanted minimum.

John answers:

READ< READ, READ before you invest. Any time is a good time to invest if you are planning to keep the stock for a long time. You should invest only what you can afford and be able to lose. You can invest for as little as $25 a month if you want to join an investment club. This is the best thing for someone just getting into investing. You will learn a lot by investing with experienced investors.
You want to keep your costs as low as you can. Trading online will cost you roughly $10 a trade so the more that you can invest the lower the cost is per share. I would recommend investing maybe $300 each time. At this your expenses are 3.3% of the trade. Try to get it down to 2%. You can save up your money for months and then buy.
Don't forget to diversify. Don't buy just one stock in one industry. Buy in different industries.
The two websites below have some good resources. Sign up for some of their daily or weekly newsletters. Investopedia has one that is a different term of the day.
EDIT – Why get a financial advisor when you can do it yourself. All it takes is common sence. All of the information you need to know is online and in books.
Only get a financial planner if you are not good with your finances. They can help you get on track.

Helen asks…

Justin Dargin : What are you tips while investing in Oil?

I know about investing in oil,but I still want to know your points which could be really beneficial for me,

John answers:

I will try to elaborate on grow nows answer.

First point, unless investing indirectly by buying shares of oil producing companies, or companies related to the oil industry, what you are actually doing is trading.

Trading is a professional activity and to undertake it successfully you must maintain a professional attitude. You will have to learn fundamental and technical analysis of oil.

Fundamental is learning about what affects supply and demand of oil, technical analysis is looking at charts and indicators to guess where the market may go.

Most traders generally tend to make money when both fundamentals and technicals look to either be bullish or bearish.

You could be told a quick tip to make a quick buck, but you know what they say, give a man a fish, feed him for a day, teach a man to fish, feed him for life.

Your first tip is free, follow the news and charts until you develop a basic understanding of what drives oil prices which way and why. Now you go look for yourself, its the best way to learn.

Its a lot of hard work, but it can be learnt, good luck, and stay professional.

Joseph asks…

can anyone give me some good tips about investing?i need to start a small restaurant but i have no capital.?

John answers:

In the US, the failure rate of new restaurants is 50% or higher.

It follows that the owners usually finance it themselves as no one else will put up anything without collateral.

Yes, the furniture, etc. Can probably be financed — but the sellers who do this aren’t dummies and they’ll want to see your financial statements and how much you have in the project — if that’s nothing, they’ll finance nothing.

Startup capital usually comes from the savings of people who work in the industry, their family, and their very best friends [who also probably work in the industry].

GL

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