Stock Market Investing Basics
Learn the Nuts and Bolts of Investing First
Before you put a dime into the market, you should take all the time you need to learn stock market investing basics. You should understand how markets operate, what the different types of investments are, what different types of brokers offer, how to set up a brokerage account, how to place orders, etc. You should also decide how you will make trading decisions, which means learning about fundamental analysis and technical analysis, and deciding which approach (or both) you will use for your investment strategy.
You can learn about stock investing basics from many sources. Free courses available online are a good place to start, but be sure to sign up for a course that offers real substance rather than just being a big sales pitch for a broker or software dealer. You can also find basic investing information in your public library or at your local bookstore or online bookseller.
Some of the stock market investing basics you will want to master before you begin trading with real money include:
The nuts and bolt of the market -- how stocks are traded and factors that influence price movements, etc.
What is the difference between investing in stocks and other instruments like futures, bonds, foreign currencies, etc.
The differences between types of stocks -- what is a penny stock and what is a blue chip stock, etc.
What is fundamental analysis and how does it fit in a short term trading system or a long term investment plan
What is technical analysis and how can it be used in short term trading and long term investing, etc.
What tools are needed for stock investing -- charting software, historical data, current news, computer hardware, etc.
Taking the time to obtain a solid understanding of markets, trading and investing before you commit real money to your undertaking will pay large dividends in the future. Look before you leap!
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