entering the stock market world

I'm interested in getting my feet wet in the stock market world (at least later on) Before that, I need to know how things work. What books do you guys suggest for a beginner wanting to learn the basics?

 

First things first: Take a course/do an independent study on statistics & probability. From there you should start actively observing any kind of markets you hope to eventually make a profit in. It may be tempting to act right away and get your feet wet, but spending time to observe, analyze, and accurately predict emerging trends is crucial to any sort of financial success.

 

All of the basic information that you need to learn about investing is available for free and online. Often times online exchanges will have extensive documentation about basic and advanced investing. Since I'm assuming you're young what I'd do it put 50% into shares, and 50% into a mutual fund of some sort. Add x$ into the mutual fund every month as a way to save/invest and buy more shares when you have a bit of money to invest. Good luck, I started when I was 15 with $300 or so and I've turned it into a few grand.

 

Feel free to pm me or hmu on skype if you want to talk about anything related to this.

 

I'm going to do some basic learning on the internet and come back for guidance. I don't know when I'll be able to do so but hopefully once this storm of exams/assignments passes.

 

I'd suggest an economics degree at a top university.

 

Blue chip stocks really won't turn you a big profit however a new emerging market in the world is crypto. Today Bitcoin saw a %15 raise in price which I predicted (and made a lot of people a lot of money). However I would advise doing your own research before you invest in anything read up on it make sure you know it's history. Doing your research and knowing what your getting into is paramount in succeeding in this field.

 

this is where normal people loose all their money.

 

i'd suggest investing in funds, but obviously plenty of research is needed before hand.
Good things about funds is : There is a fund manager they invest money into a variety of shares, you just sit back and relax ( providing you have analysed the fund beforehand and you will know your money is in good hands.
- You can get a payout through dividends every so many months/per year

Bad thing about funds
- your money is in someone elses hands,
- your not guaranteed to make a profit

 

Bull fucking shit. This is not better than this in the long run, and blue chips make an awful lot of sense for someone getting started.

Yeah, it definitely helps, especially for understanding high-level market forces. The best advice is just to read a lot about things that interest you. You could try SA (http://seekingalpha.com/), but don't take anything there as truth. People have differing opinions, and you should evaluate for yourself which you ascribe to. I still stick to my "play around with free mock trading software" advice given earlier. The advice about mutual funds is reasonable, but if you're actually trying to learn about things for yourself, reading is the way to go and SA isn't a bad place to start.

 

I'd want to remind you that any future possibilities of a company doing something extraordinary (and failures as well) are already directly incorporated in the share price. Thinking for a certain reason that a particular company is going to do this and that and that therefore their share price is undervalued will not bring any substantial profit. The probabilities of all the possible outcomes of their strategy and the subsequential payoffs are already included in the share price. If it goes up because it did something you (and a lot of others) expected, it does so because before there was also a chance it wouldn't.

 

What super said is correct, however MOST people want the fast method of money - patiency is the best tho

 

That's one school of thought. See http://en.wikipedia.org/wiki/Efficient-market_hypothesis for more reading. Fwiw I support a stronger semi-strong view by which I mean that all information excepting certain private information is already priced into share values.

 

That is true for as long as it is kept private.
I highly doubt he'd get access to information like that though, plus it would be insider trading in most cases

 

Mutual funds are collections of stocks... However it's not really feasible for us to give investment advice without knowing the amount of capital/risk tolerance/time horizon. Also OP I recommend "A Random Walk Down Wall Street" by Burton Malkiel. It's a good book for beginners regarding the markets in general. Try to watch CNBC as well when you can. You won't necessarily learn a lot, but you'll learn the language.

 

Idk what kind of advice you're looking for, but here's three things I find really important:

1) Decide whether or not you want slow and steady gains or heavy risk/high gains. Personally, I believe that you should go the latter route unless if you have large sums of money. Either way, look at your investments as a sunk cost. There's really dozens of ways to look what type of trading you want to do, but these are the two most broad types in my eyes.

2) Honestly, you will need at least $5,000 roughly if you want to see any kind of movement. You don't need this much if you're looking to go long and only rebalance your portfolio annually, but I do OTC and the trade fees are killing me. What people neglect to remember, is that the trading fees are fairly heavy to both enter AND exit a position, so it really adds up.

For example (very simple, using OTC stock):
Stock A is $1/share. You invest $100 for 100 shares. Trading fee is $10, so in actuality, you paid $110 to just ENTER the market, and then another $10 to EXIT your position. In total, you paid $120, meaning you would need your shares to go up at LEAST 20% to break even.

3) Find a company that you believe in. Ask yourself, "will this company still exist ten years from now"?

Of course, this is an an incredibly simplistic example, but it should give you a general idea. Also, no matter how much you decide to invest, look at it as a sunk cost.

 

You don't say... smh

I was advising putting part into single stocks that have the potential to be more rewarding but a bit more risky. And the other part into a mutual fund of some kind on a monthly basis, as its a good way to easily invest without much thought. I do automatic transfers from my bank account.

 

Read the intelligent investor.

 

Invest your money into a buisness of your own IMO. Something you love. Whatever it may be

 

To get into the stock market you need big money no 100 bucks.