By reading this article, you must be interested in either investing in stocks, learning the pros and cons of investing or whether or not investing your disposable income in the stock market to get more cash or to build a nest egg for retirement is the right option for yourself.
What is a stock
A stock is a piece of a company; when investors, organizations, or other kinds of groups like equity funds invest money in a company, they are purchasing a portion of the company in the hopes of a return on their original investment, for example, the money you place into stock you will want an increase on your initial investment.
If the company fails or the stock price drops because stocks often fluctuate, see your portfolio cut in half due to the fall of a company’s stock price.
How to begin to understand investing
To understand investing, it is relevant to point out that placing your money in the stock market, index funds, the housing market, or other investment opportunities carries risks of losing your nest or your entire investment is highly recommended before embarking on an investment strategy.
By doing your research, and that you take into account there is no such thing as a get quick rich scheme or a guaranteed successful investment to develop your knowledge and build your library is recommended that you read these books;
- Investing for Dummies by Tony Levene
- The Little Book of Common-Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns written by John C. Bogle
- Day Trading for Dummies, 4th Edition by Ann C. Logue MBA
- Unshakeable by Tony Robinson
- Money Master the Game by Tony Robinson
The list of resources is there to help introduce yourself to the world of investing and see by doing a deep dive whether or not this kind of investment strategy is genuinely beneficial for your portfolio and plans.
Alternatively, if you are in a higher income bracket, I strongly recommend hiring an investment strategist, stockbroker, or other professional that can help you make the decisions for yourself. There are three kinds of investment brokers.
The first kind of brokerage is the stockbroker, who performs executions. These are people who will only buy and sell your stocks from what you have decided when to buy or sell your stocks or other investments.
The second kind of brokerage is a mixture between the execution stockbroker and the stockbroker that works with no oversight. With this broker, the broker will tell you where they will invest your money and why they should invest your money in stocks such as Apple.
This kind they will let you know when the investment will happen and why they recommend investing your money in specific companies or other assets but will only place the order once you have made the final decision.
The final broker you are likely to come across is one where you give them your money, and they will make all the investment decisions on your behalf. I will be making these decisions weekly, monthly, and yearly.
You have the right to go to a different broker or stop investing, but this kind of broker does not involve the index.