michaeldrennie
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Why do you want to invest? Do you want to invest money towards your retirement or are you looking to make some money for earlier in life?
You obviously have no idea what you're doing so I'd just start by opening up a ROTH IRA. You can contribute about $4000-$5000 a year and it goes towards your retirement. Start out with some ETF's and safer stocks like GE. Over the next couple of years read more on investing and then you can find more rewarding stocks. For now though, play it safe until you know more. Right now is actually a good time to get into the market, but if you aren't careful you could lose a lot of money.
Investing in video game makers might not be a bad idea, but I would invest in a company that maybe owns a video game company. Finding a company that only makes video games is risky. You want a company that has lots of resources and market share.
You should go set-up an account at a discount broker that can offer some advice and guidance, try Charles Schwab or Edward Jones for now and in a few years you can handle you own investments online. |
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I like SuperCactus' companies above. Here is my standard advice:
Choose a stock of a solid company (in or outside the USA) that you believe has a future (or a mutual fund), and that has a 3-5 year record of consistent growth of its share/stock price. Look in on its price and news articles (like through Yahoo Finance) every few days or daily to make sure nothing tragic is occurring to your particular company or stock’s value. But HOLD it (except in the event of some major free-fall). Jumping in and out (selling the shares and buying them again within 3 business days) to avoid losses is only permitted by law if you are a ‘margin trader’. As you earn money you should also buy the stock of a company in a different industry, but using the same evaluation technique as above. Eventually you should hold at least one solid company's stock in several healthy industries.
This is a simple stock market plan that should serve you very well. You’ll need to contact a brokerage to start an account. I like Fidelity and Scottrade. Both have online trading. If you don’t have an IRA (Individual Retirement Account) I would start a Roth IRA as the account in which to keep your stock because all the earnings/gains are tax-free. A HUGE benefit. And max the allowed contributions whenever you can afford to. You can’t withdraw this money until age 59 ½ without a major penalty, but still the wise thing to start first. You can also start a second regular brokerage account at the same time and place whatever amount of stocks in it, if you feel more comfortable knowing you can sell off and withdraw the money anytime. But you’ll have to pay capital gains tax on those withdrawals.
Good luck.
Jesus is Lord. |
PRyder2000
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If you don't have a lot of money, then shares probably aren't the way. Yes, they can produce good results, but even the best of them tend to give investors a mild headache when the economy is, as you beautifully describe it, in the crapper.
Warren Buffet, Benjamin Graham and all the other top notch investors tend to recommend you buy safe, boring shares. I read recently that Warren Buffet is investing in furniture companies, whilst the world is reeling through the credit crisis. This is a sound investment. Slow, perhaps, maybe a bit boring, but you can't deny that money will be made. It's an old, established industry, that isn't ever likely to be tipped as a "hot stock," but while the hot stocks are going like hot cakes, and then dropped like hot potatoes, it's generally accepted that the slow-but-sure industries will slowly, but surely, outperform. Tobacco, amongst other "defensive" stocks also fall into this category.
I recommend you avoid shares if your budget isn't up to taking at least a 50% loss. Put your money in a savings account, and then when you feel you can afford to risk money, have a dabble with shares. It is recommended that you keep around 50% of your money in safe products like savings accounts, etc. That way if you do suffer a loss on the stock market, it's not the end of the world.
With that in mind, if you feel a savings account isn't producing a good enough return, I have been using Zopa.com. This is a lending and borrowing exchange where you lend money to individuals of good credit rating, cutting out the banks and letting you keep all the interest. Because you choose the rates you lend at, you can always make sure that you're getting more than you would in a savings account.
There's also a bonus - if you apply via the following link and lend out more than £500, Zopa will give you a complimentary £30! If you're in the US, the link should redirect you to the US site, and hopefully there'll be a similar offer.
www.zopa.com/member/The%20Hulk
So, if you lend out more than £500, you get £30, which is 6% of 500! 6% upfront, and then maybe 10% (based on my results in the UK) on top of that for the rest of the year is a very attractive offer (considering that in the UK a savings account will pay about 5%-6.5%.) Unfortunately it seems that if you lend out £1000, you still only get £30, which brings it down to 3%, but it's still an attractive offer! Hopefully it would be a similar sort of percentage in the US, if that is where you are based.
Hope this helps! |
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