Your Questions About Money Making Stocks To Buy

Mark asks…

i am looking to buy stocks. i just want to make little money from stocks.what should i do?

i was looking in buyng stocks. i want to make about $500-$700. i want to invest small time what shoulds i do. i dont want to spent a lot of money and want to make little money just enough to pay for one of my bills.

John answers:

If I understand you correctly, you want to invest in stocks for a short period of time and be guaranteed to make money to pay an upcoming bill.

Ain’t gonna happen. The stock market doesn’t work like that. Are you OK if your stocks lose money instead of make money? If not, then you should not look at stocks.

Instead you should look at a high interest online savings account like Emigrant Direct. They’re currently paying 5.15% APY guaranteed! If you have a time horizon of more than a few months, but less than a year, then maybe a CD would be better.

If you want to RISK your money in the stock market, but do not know anything about individual stocks, then you should buy an exchange traded fund like (stock symbol) SPY, which essentially is buying part of the S&P 500 index. It’s a good way to buy into the overall market without betting on individual stocks.

Susan asks…

How do i buy stocks? From which website and how do i sell them to make money?

Please give me some info, i need websites where i can buy stocks and follow them and be able to sell them to make money, please give me a website and explain the process, thank u so much!!!

John answers:

Try You transfer money to the money market account or have the money to buy the stocks come right from your checking account. When you sell, you transfer the money back to your checking account or keep it in the money market account.

Charles asks…

I have $100 to buy stocks from my parents. What should I buy?

I am hoping to make some money by buying stocks that are maybe the next big thing. I am really interested in Amazon’s other companies like ChaCha search but I don’t think it is publicly traded. I am just looking for some good suggestions.
Hmm Okay I think I need to be a little more specifice on this, due to the answers I have gotten so far. I am not inexperienced when it comes to stocks. I currently have shares of Disney and Coke. (So I have already taken the steps of buying something familiar) I am not worried about transaction fees because my parents will cover those it is more just I want to invest in something new and upcoming. I also already have money in mutual funds.

John answers:

Depends on your age.

If you are a minor, put it into a Coverdell ESA account at Scottrade and pick a NO-LOAD, NO TRANSACTION FEE mutual fund such as:

EUROX Eastern European Investments has a $100 minimum. Most others require more.

If you bought stocks, you have a $7 transaction fee just to buy, so you would lose 7% right off the bat, then another 7% when you sell it.

Ruth asks…

How do you make money in stocks???

I understand the whole gaining money from capital and buying stocks when they’re low and selling when they’re high priced. But lets say you buy a stock for 98 dollars and the stock price for the company grows to 105 dollars. What would be your profit if you sold your share at this price???Also, how do you know if the company gives quarterly dividends?

John answers:

Purchase price-sale price. There is also a thing called bid ask spread which will cut into your profits, also you will pay a fee for purchasing and then for selling the stock (fees will vary depending on where you buy). In order to figure out if the company issues quarterly dividends you would need to look at their income statement, it is clearly reported their, and every company issues quarterly earnings statements (found in the 10Q). Look at ford’s, they issued in first quarter 2006 not 2007.

Sandra asks…

How to make money on stocks?

I’m new to stocks and I started using a simulator recently. How exactly do you make money buying and selling stocks. For Example: If I were to buy 500 shares of a company at $1.00 and it then rose to $2.00 and then I sold the shares at $2.00. Will I have made $500 [($2.00-$1.00)500=$500] minus the commission of the broker. Is my reasoning correct or am I wrong?
How much are taxes on trading stocks or does that depend on the state your in?

John answers:

You are completely correct in your assertion.

However, for a stock to double in price (quickly) is rare.

Before making any stock purchases, you should have the following knowledge:

a) Why is this stock a good stock?
B) How much loss will happen before I must sell it?
C) How much gain is acceptable before I sell it and lock in my gains.

Here are some guidelines for the questions:
A) If a company projects a good growth for the next quarter and over the next year (along with projected earnings), then that may be a good start for a potential purchase. There are other factors you may also look into but Earnings and Growth are the basic.

B) If a stock drops 10% will you sell it? 20%? 30% How much will you lose before you sell and consider it acceptable risk?

C) Since most stocks will not rise and double their price quickly, where do you set the gain to consider it a winning trade and sell it so you can find more winners? 10%? 20%? 50%? The higher the minimum gain, the more difficult it will be to reach.

You should also consider diversifying across multiple companies so that if one or two stocks fall, you may still win by having 5 – 8 gainers at the same time that offset the losses.

(Diversifying over 25+ stocks is a bit too many and you should invest in mutual funds instead of watering down your portfolio with so many positions.)

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