Hey guys, so my boyfriend and I have recently started becoming interested in the stock market. I've heard stories of people making decent amounts of money (as hard as it is, lol) and I have started thinking about investing some money in the market.

I have recently joined this website in order to get more information,

stocksindemand.com

and I found it to be really informative and I actually invested some money in one of the companies that they discussed on there (BDCO) and made a couple of hundred that day! I was wondering if anyone has any techniques, information, tips, or stories to share?

Thanks.

Check to see if your employers have some kind of stock options in your benefit packages. This is a great way to get your feet wet in the stock market. You have a vested interest in the stock of your employer and they can deduct the cost from your paycheck or sometimes even give you stock in lieu of cash for bonuses, etc. It's a good first step.

kk~

My employer actually doesn't offer any stock plan, so I'm trying to do it on my own. It's a little hard because I only know so much, but I'm trying to learn and the adminstrator to that website has actually been in contact with me and gives me some advice. For example, one strategy he explained is analyzing the charts and how to determine an entry point based on the high point and the low point, aka resistence and support.

I had to figure out what the terms meant lol but it sounds right. What do you guys think? Or does anyone have any other strategies?

If you are in the USA, investigate IRA's for long term investments. Depending upon which sort you have you either get a tax deferment and you pay with before tax dollars (Traditional IRAs)..You pay taxes when you withdraw, but you don't pay taxes on year by year increases which helps compounding or a ROTH plan in which you with after tax dollars, but do not owe taxes when you withdraw.

My wife and I have made very substantial gains doing this as a long term strategy. Because there were no IRA's (Individual Retirement Accounts) when we started working...we were well into our 40's when they came around, we are substantial "multi-thousandaires". Had we been able to make this type of contribution when we were in our 20's rather than mid 40's we would have easily been multi millionaires by now.

Until you are really savvy on how to play the market, mutual funds may be a way to start. It is also important to balance the sort of sector you invest in depending upon your immediate need and your goals. A younger person with income can take larger risks.

Do not invest any more than you can afford to lose. I have ridden our investments through ups and downs and even in the current market, we did not lose money (because half of it had been moved to fixed income investments.)

Until you are experienced, "playing" the market on a day by day basis is really for experts. Be prepared to ride through ups and downs. I did manage to make some substatial gains by buying at the depth of the last recession, now that it has recovered a bit.

Educate yourself on all sorts of investments. Any bookstore will have books on money management and some geared to 20-somethings. Make sure you understand the whole gamut of personal finance. I've used books by Suze Ormann for some decent explanations on how all of this works.

Jon

The website administrator is referring to technical analysis, which is basically the study of near-term supply and demand to predict peaks and troughs in security price movement. This is often done with the assistance of charts and indicators (algorithms which factor in trading volume and price movement). Momentum and the slow stochastic oscillator are two such popular indicators.

Fundamental analysis attempts to find a valuation based upon the company's cashflow, assets, and competitive advantages. Fundamental analysis sees a stock as less of an abstract commodity, and more as a share of an underlying business, and complements technical analysis. It is essential for large volumes of stock. (i.e. while you can easily trade $2000 of stock, trading $2M requires forethought - will there be $2M of liquidity at the price I want to buy/sell at?). Understanding financial statements and accounting practices is necessary to understand if a prospective company is profitable and making good use of shareholders' capital.

Additionally, market psychology and economic outlook are also factors to take into account when planning an investment. Collectively, these forms of analysis form a subset of finance (the science of funds management and valuation). Much of this is covered by MBA or CFA coursework, plus a whole lot more. Need I mention that I love finance?

If you want get a more complete grasp of what you don't know and what is proven good investment technique, I'd advocate reading a few good biographies of Philip Fischer, John Templeton, Warren Buffet, George Soros, and the like. Forums are great for social interaction, but less great for weeding out good investment role models.

I'd recommend against paying a fund manager to manage your money for you long term unless you're happy with roughly the return you'd get from an index fund. Also, a decade is about the length of time it takes to confirm a good investor - every punter looks like a genius during a six-month bull market.