Tuesday, November 22, 2011

Advice for a college student interested in investing?

I am a college student interested in investing a little bit of my money through online stock trading. I have never really invested money before, so I am really just looking for advice on how to get started. I am not looking to do any serious trading, just a few options to let my investment grow. Any help is greatly appreciated, thanks!Advice for a college student interested in investing?
There are a number of good dividend paying stocks that allow you to buy directly from the company, then the reinvest dividends into whole or fractional shares of the stock. They are called DRIPs or Dividend reinvestment plans. Most of them are at very low prices right now. There is plenty of info out there on the subject. Check them for their record of paying dividends and their record for increasing dividends. Good luck to you.Advice for a college student interested in investing?
For investing, think diversification, balance and long term.





If you don't want to do those 3, then it's speculation, which is much more like gambling. Or you should just save your money in a CD, savings account or money market.





As for how to invest, I recommend using Index mutual funds or ETFs. Personally, I like Vanguard mutual funds as they are simple and they don't fee you to death.





Pick your percentage and invest 50 percent in their Total Stock Market Fund, and 30 percent in their Total Bond Market Fund, and maybe another 25 percent in their foreign stock fund (I forget the exact name). You can play with the percentages.
Most stock investors lose money. (Let that sink in for a minute.)





You need to ask yourself what it is that you are trying to accomplish. If you are looking for a safe place to put some money, look for a bank with a good rate (ING is a good one) or get a CD.





If you are looking to learn, find a broker that has ';paper trading'; where you can invest with play money.





The vast majority of investors have poor results because they buy impulsively and have no plan for exiting their trades. (You bought XYZ stock and it went to $100. Now what? Sell it? Buy more?)





I cannot teach you an investing strategy in a few paragraphs. There are entire libraries written on the subject. I can recommend a good place to start.





I would suggest that you get Investors Business Daily and read it cover to cover everyday, for at least a week. It sounds harder than it is - IBD is thin and written at 6th grade level. They provide an outline of a sound investing strategy. If you subscribe, you can sometimes find a deal where they will provide a decent book by William O'Neil on how to invest. (Personally, I don't recommend investing in their CANSLIM training program that they offer. It's a sink hole for more money. There are better training programs.) Your school library might have IDB for free.





Personally, I like the idea of combining stock with options. You have the ability to protect your profits while improving your profit potential. That's how the ';big guys'; invest - Hedge Funds. However, that strategy takes a lot more time to learn and manage. It's not appropriate for a college student unless you are an MBA.


Good luck!
Don't put all your money in stocks and stock funds like everyone will tell you to do. Diversify with bond funds, high yield bond funds, and CD's. Learn from what happened last year.
Well check the economy is the first thing it might be hard to with the economy like this

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