For more information about Vanguard funds or ETFs, visit www.oldyorkcellars.com to obtain a prospectus or, if available, a summary prospectus. Investment objectives, risks, charges, expenses, and other important information about a fund are contained in the prospectus; read and consider it carefully before investing.

*For market orders on the Standard & Poor’s Index sizes – for the month period ended December 31,  

**Options are a leveraged investment and aren't suitable for every investor. Options involve risk, including the possibility that you could lose more money than you invest. Before buying or selling options, you must receive a copy of Characteristics and Risks of Standardized Options issued by OCC. A copy of this booklet is available at www.oldyorkcellars.com It may also be obtained from your broker, why bitcoin is not gold exchange on which options are traded, or by contacting OCC at S, how to invest in the stock market on my own. Franklin Street, SuiteChicago, IL ( or OPTIONS). The booklet contains information on options issued by OCC. It's intended for educational purposes. No statement in the booklet should be construed as a recommendation to buy or sell a security or to provide investment advice. Call The Options Industry Council (OIC) helpline at OPTIONS or visit www.oldyorkcellars.com for more information. The OIC can provide you with balanced options education and tools to assist you with your options questions and trading.

All investing is subject to risk, including the possible loss of the money you invest. Diversification does not ensure a profit or protect against a loss.

Vanguard Personal Advisor Services and Vanguard Digital Advisor's services are provided by Vanguard Advisers, Inc. ("VAI"), a federally registered investment advisor. VAI is a subsidiary of The Vanguard Group, Inc. (“VGI”), and an affiliate of Vanguard Marketing Corporation. Neither VAI, VGI, nor VMC guarantees profits or protection from losses.

You must buy and sell Vanguard ETF Shares through Vanguard Brokerage Services (we offer them commission-free) or through another broker (which may charge commissions). See the Vanguard Brokerage Services commission and fee schedules for full details. Vanguard ETF Shares are not redeemable directly with the issuing fund other than in very large aggregations worth millions of dollars. ETFs are subject to market volatility. When buying or selling an ETF, you will pay or receive the current market price, which may be more or less than net asset value.

• You can start investing in stocks through a brokerage account or by using a robo-advisor.
• But you should establish goals, review your financial situation, and determine your risk tolerance first.
• Rebalancing your portfolio periodically will help you keep your investments in good shape.
• Visit Insider's Investing Reference library for more stories.

Looking to maximize your money and who is behind bitcoin core the cost of inflation? You want to invest how to invest in bitcoin canada the stock market to get higher returns than your average savings account. But learning how to invest in stocks can be daunting for someone just getting started. 

When you invest in stocks, you're purchasing a share of a company. They're basically a slice of ownership in a company that can yield returns if it's successful. There are various ways to invest and leverage your money. But there's a lot to know before you get started investing in stocks. 

Step 1: Figure out your goals 

It's important to know what your fundamental goals are and why you want to start investing in the first place. Knowing this will help you to set clear goals to work toward. This is a crucial first step to take when you're looking to create an investing strategy later on. 

If you're unsure of your goals, first review your financial situation, such as how much debt you have, your after-tax income, and expected retirement goal date. Knowing when you plan to retire can let you know your overall time horizon — or how much time you plan to hold onto your investments to reach your financial goal. 

Based on that information, you can start figuring out your investing goals. Do you want to invest for the short or long term? Are you saving for a down payment on a house? Or are you trying to build your nest egg for retirement? All of these situations will affect how much — and how aggressively — to invest.

Finally, investing, like life, is inherently risky And you can lose money as easily as you can earn it. For your financial and mental wellbeing, you want to consider your appetite for risk. This is typically referred to as "risk tolerance" or how much risk you can reasonably take on given your financial situation and feelings about risk. 

Quick Tip: You can take this investment risk tolerance quiz created by Rutgers to see where you stand and help inform your asset allocation.

Step 2: Determine your budget 

Once you've got some solid goals set, it's time to review your budget. Here are some things to consider:

• Your current after-tax income. Many people look at their pre-tax income, but you want to know how much money you're working with after taxes which can help you create a realistic budget. 
• Your expenses. How much are your monthly expenses? How much do you have leftover each month? Is it possible to reduce or cut some expenses? 
• Overall debt. How much debt do you currently have? List out your monthly payments and compare that against what you're making.
• Net worth. Your net worth is your total assets minus your liabilities. This number can give you an idea of where you're at financially and will allow you to get a "big-picture" snapshot of your financial health. 
• Financial goals. As we mentioned before, knowing your goals is important as it gives your money a purpose. 
• Risk tolerance. How much risk do you feel comfortable taking on? Calculating this will give you a clearer idea of what you can afford to lose.
• Time horizon. How much time do you have before you want to reach your investing goals? This is key to mapping out your finances to ensure you're keeping pace with when and how to invest without disrupting your budget or other goals not related to trading securities.

All of these are key ingredients that can help you determine your budget. 

One last thing to consider: when you expect to retire. For example, if you have 30 years to save for investing in johannesburg stock exchange, you can use a retirement calculator to assess how much you might need and how much you should save each month. When setting a budget, make sure you can afford it and that it is helping you reach your goals. 

Step 3: Get acquainted with various stocks and funds 

Now it's time to start doing research on what to invest in. There are different ways to invest in the stock market and there's a lot to know so doing your research is well worth your time.

Stocks are a good option to consider if you want to invest in specific companies. Just keep in mind that you should look into the company itself and how it's performing over time:

• Stocks — A stock is a security that gives stockholders the opportunity to buy a fractional share of ownership in a particular company. There are many different types of stocks to choose from, such as blue-chip stocks, growth stocks, and penny stocks, so make sure you understand your options, what they offer, and what matches with your budget and investing goals.

"If you're going to pick a stock, look at the [company's] financial statements and select the stock based on the "bucket" you're trying to fill in your portfolio. For example, are you looking for a dividend stock? Look at the dividend history. Are you looking for a growth stock? Look at the earnings per share: Is it showing consistent growth? [Consider] how these indicators measure against [its] peer group," says Amy Irvine, a certified financial planner at Rooted Planning Group. 

So you want to take steps to look at your income and expense balance sheets and make sure you're hitting the right bucket — which refers to the grouping of related assets or categories — for your investing needs. For example, investing in small-cap, mid-cap, or large-cap stocks, are a way to invest in different-sized companies with varying market capitalizations and degrees of risk. 

If you're looking to go the DIY route or want the option to have your securities professionally managed, you can consider ETFs, mutual funds, or index funds:

• Exchange-traded funds (ETFs) — ETFs are a type of exchange-traded investment product that must register with the SEC and allows investors to pool money and invest in stocks, bonds, or assets that are traded on the US stock exchange. There are two types of ETFs: Index-based ETFs and actively managed ETFs. Index-based ETFs track a particular securities index like the S&P and invest in those securities contained within that index. Actively managed ETFs aren't based on an index and instead how to invest in the stock market on my own to achieve an investment objective by investing in a portfolio of securities that will meet that goal and are managed by an advisor. 

• Mutual funds — this investment vehicle also allows investors to pool their money to invest in various assets, and are similar to some ETFs in that way. However, mutual funds are always actively managed by a fund manager. Most mutual funds fall into one of four main categories: bond funds, money market funds, stock funds, and target-date funds. 

• Index funds — this type of investment vehicle is a mutual fund that's designed to track a particular index such as the S&P Index funds invest in stocks or bonds of various companies that are listed on a particular index. 

Quick tip: Wondering just how much certain mutual funds will cost you? You can use FINRA's Fund Analyzer tool to help you examine and compare the costs of owning funds.

You want to get familiar with the various types of investing vehicles and understand the risks and rewards of each type of security. For example, stocks can be lucrative but also very risky. As we mentioned before, mutual funds are actively managed, whereas index-based ETFs and index funds are passively managed. 

This is important to keep in mind because your costs and responsibilities vary depending on an active versus passive approach. Mutual funds are professionally managed and may have higher fees, how to invest in the stock market on my own. With ETFs and index funds, you can purchase them yourself and may have lower fees. Having a diverse portfolio can help you prepare for the risk and not have all of your eggs in one basket. 

"You can choose to invest in individual stocks, a stock mutual fund, or an ETF. ETFs are somewhat similar to mutual funds in that they invest in many stocks, but trade more similarly to an individual stock," explains Kenny Senour, certified financial planner at Millennial Wealth Management. "For example, let's say you open a brokerage account with $1, You can use that money to purchase a certain number of shares in ABC Company, the underlying price of which fluctuates while the stock market is open. Or you could choose to invest it in a stock mutual fund, which invests in many different stocks and is priced at the close of each market at the end of the day." 

Quick tip: Building a diversified portfolio with individual stocks can be time-consuming, especially for people just starting out. That's why experts recommend beginner investors focus on mutual funds, index funds, or ETFs, which give you a large selection of stocks in one go.

Step 4: Define your investing strategy

The main things to consider when defining your investment strategy are your time horizon, how to invest in the stock market on my own financial goals, risk tolerance, tax bracket, and your time constraints. Based on this information, there are two main approaches to investing.

• Passive investing — an investing strategy that takes a buy-and-hold approach, passive investing is a way to DIY your investments for maximum efficiency over time. In other words, you can do it yourself instead of working with a professional. A buy-and-hold strategy focuses on buying investments and holding on to them as long as possible. Instead of trying to "time" the market, you focus on "time in the market."
• Active investing — an active approach to investing that requires buying and selling, based on market conditions. You can do this yourself or have a professional manager managing your investments. Active investing takes the opposite approach, hoping to maximize gains by buying and selling more frequently and at specific times.

Quick Tip: Be aware of any fees or related costs when investing. Fees can take a bite out of your investments, so compare costs and fees.

Step 5: Choose your investing account 

After choosing your investment strategy, you want to choose an investing account that can help you get started. Decide if you want to do it yourself or get a professional to help out. 

If you want to be a passive investor and DIY, you can look into:

If you want to get started with active investing, you can use:

When considering active versus passive investing and if you should DIY it or get a professional, you want to consider several factors. Look at total fees, the time commitment involved and any account minimums as well. 

The easiest way for many people to get started with investing is to utilize their employer-sponsored (k). Talk to your employer about getting started and see if they'll match part of your contributions. 

The key is to choose an investment account that fits with your budget and investment strategy, open an account, and then submit an initial deposit. Just know that when you submit money, it's in a cash settlement account and not yet actively invested (I made this mistake when I first started investing!) 

Step 6: Manage your portfolio 

Now it's time to start managing your portfolio. So that means buying stocks, ETFs, or index funds with their appropriate codes from your account. That is when your money is actually invested. 

But it doesn't stop there — you also want to continue to add to your portfolio so consider setting up auto-deposits each month. You can also re-invest any earnings or dividends to help build growth over time.  

Diversify your portfolio by investing in different types of investment vehicles and industries. A buy-and-hold approach is typically better for beginner investors. It can be tempting to try out day trading, but that can be very risky. 

Quick tip: To limit risk, avoid day trading, penny stocks, and industries you don't understand.

Lastly, you'll want to rebalance your portfolio at least once a year. As your portfolio grows and dips, your asset allocation — or how much you've invested in stocks, bonds, and cash — will have shifted. Rebalancing is basically resetting that to the proportion you want. 

"Rebalancing is the practice of periodically selling and buying investments in your underlying portfolio to make sure certain target weights are stable over time. For example, let's say you are an aggressive investor with 90% of your portfolio in stocks and 10% of your portfolio in bonds. Over time, as stocks and bonds perform differently, those weights will drift," explains Senour. 

"Without periodic rebalancing, your portfolio could become 95% stocks and 5% bonds which may not be in line with your intended financial goals for the account. There's no "perfect" time frame for rebalancing as some financial professionals suggest doing so how to invest in the stock market on my own quarter, but conventional wisdom says at a minimum rebalancing at least once per year can make sense."

Continuing to invest money and rebalance your portfolio periodically will help you keep your investments in good shape. 

Helpful resources

Need help with learning how to invest in stocks? Here are some top investing books to help you get started.

• "The Intelligent Investor" by Benjamin Graham: This comprehensive book will help you get started with investing and has been considered a "stock-market bible." 
• "Broke Millennial Takes On Investing" by Erin Lowry: This how-to guide will walk you through how to invest in stocks and break down the terms in a straightforward, digestible way. 
• "A Random Walk Down Wall Street" by Burton G. Malkiel: This best-seller has been hailed as a go-to for investors and covers the range of investment opportunities and helps you get started on your investment journey. 
• "How to Buy Stocks" by Louis Engel and Henry R. Hecht: Considered a "classic" guide on how to buy stocks and what you should know about regulations.

The financial takeaway

Learning how to invest in stocks can be overwhelming, especially if you're just getting started. Figuring out your goals and determining a budget are the first steps to take.

After that, get acquainted with various investment vehicles and choose the right ones for your financial goals and risk tolerance.

The key is to get started and be consistent. The best investment strategy is the one you'll stick with. Just be aware all investing comes with risk and do your research on any related fees. 

When you buy through our links, how to invest in the stock market on my own, Insider may earn an affiliate commission.

When you buy shares in one of these companies — even a very small number of shares — you then own a small part of that business.

You need to use a third party, called a ‘broker’, to conduct the actual transaction of buying or selling shares.

How can I make money from shares?

People aim to make money from investing in shares through one, or both, of the following ways:

An increase in share price. Usually known as ‘capital growth’ or ‘capital gain’, all this means is that you make money by buying your shares for one price and selling them for a higher price. Conversely, it’s important to remember that if the share price falls below the amount you paid and you sell your shares at this lower price, you would lose money.

A share in the company’s profits. Usually known as ‘dividends’, these payments are a portion of company profits paid out to shareholders, usually twice a year. Companies don’t have to pay dividends, but many see it as a way of returning earnings to their shareholders.

Isn’t my money safer in a savings account?

It’s true that savings accounts and term deposits are a less risky type of investment, and it is generally recommended you keep some of your money in these assets.

But investing in shares can give your money the chance to earn better returns than it would if you left it in a bank account.  

Taking the first steps

Thinking about why you want to invest can help you work out your strategy and avoid making irrational decisions down the track. Ask yourself a few key questions:

• How long do you want to put money into the stock market for?
• How much are you going to invest?
• Are you going to make regular contributions?

How do you learn to invest?

The sooner you start to get the knowledge you need, the quicker you can get to a point where you can feel confident.

It’s important to educate yourself about the economy, interest rates, exchange rates and government policy, and understand how these factors may affect a company’s performance, says the Australian Government’s MoneySmart website.

The ASX also has a share investing education section on its website.

CommSec Pocket lets you invest anytime, anywhere, with as little as $ Choose from seven themed investment options to easily invest in something that appeals to you – like tech, sustainability leaders, or the biggest companies on the Australian market. Gain experience by using the app and CommSec will help you along the way with bite-sized tips, videos, and articles to teach you all about the share market.

How much do you need?

Most brokers would require the first trade to be at least $ which would be referred to as the 'minimum marketable parcel of shares'. The size of increments or additional purchases thereafter would be at the individual broker's discretion.

The ASX suggests you should “start your share investing with at least $2,” as a general guide. Understanding the costs involved should help you decide how much you want to invest.

Starting small

When you buy or sell shares, each individual transaction incurs a brokerage fee in addition to the price of the shares themselves. This means the less you invest, the more the fees will be as a percentage of your total investment.

For example:

• If brokerage costs you $ and you buy $ worth of shares, brokerage will represent just over % of your investment.
• If brokerage costs you $ and you buy $5, worth of shares, brokerage will represent % of your investment.

The point is, if you start with a small amount of money, the company you invest in may have to perform far above the average rate of return for you to make enough money to even cover your costs, let alone turn a profit, when you eventually sell your shares.

On the other hand, it is important to understand shares are considered the riskiest type of investment and the more money you invest, the more of your savings you are effectively opening up to that risk. You need to be comfortable with the possibility of losing the money you put into the share market.

How do you choose which shares to buy?

Researching and choosing companies to invest in can be enjoyable and there are lots of tips and recommendations to guide you through the process.

MoneySmart suggests starting with companies in an industry selling photos online to make money you know something about, as this may make it easier for you to understand how a business is doing.

What to look for?

While past financial performance and achievements can be important indicators of the stability of a business, what really drives share prices is a company’s future outlook.

MoneySmart recommends asking questions like:

• Will the goods and services this company provides be in demand in the future?
• Are there opportunities for the company to grow?
• Who are the company’s competitors and are they in a strong position?

Sources such as a company’s annual report, as well as its yearly and half-yearly financial results statements, can be good places to find relevant information. These can be found by searching for the company name on the ASX website.

Cheap but uncheerful

Cheap shares don’t always represent good value for money.

While ‘penny stocks’, for example, might look cheap at 10 to 20 cents per share, a small company with a shaky track record has the potential to wipe out your money fast.

Just because you can buy 5, shares at $ each with your $1, doesn’t mean this is better value than purchasing 15 to 20 shares valued at around $60 per share. What matters when it comes to making money is not how many shares you own, but how much each share increases in value.

Be wary, too, of buying shares just because prices are falling. A company may have announced a profit downgrade or a change in its situation that materially damages its future chances of making money, which is causing its share price to fall.

Look at companies’ share price charts for a historical view of share value. If a share price has been falling over the long term, that company would probably be considered a high risk investment.

Not rising too quickly?

On the other hand, rapid and significant share price growth can also be cause for concern.

As mentioned above, share prices generally rise when a company makes a positive announcement about its future – for example, a contract for new business, a profit forecast or a sales outlook.

But if the share value grows too quickly and the company doesn't deliver on its forecast, the prices might fall again as the shares become less desirable.

Basically, price is definitely important when choosing shares, but it should always be considered as part of a range of factors.

How much are you willing to lose?

Selling decisions are as critical as buying decisions to your results in the share market, MoneySmart notes.

Consider setting yourself a ‘percentage stop’ of around 15% for each company you buy shares in. This means deciding how much of your originally invested money you are willing to lose. Once a company’s share price falls below this amount, you commit to selling those shares. Otherwise, losses in private individuals who invest their own money in potentially hot new companies company may wipe out gains in the rest of your portfolio.

News shows, Hollywood films, and TV all assume that you know what the stock market is and how it works. Everyone knows that you can make a lot of money in the stock market if you know what you&#x;re doing, but beginners don&#x;t often understand how the market works and exactly why stocks go up and down.

Here&#x;s what you need to know about the stock market before you start investing.

What is the stock market?

Stocks, which are also called equities, are securities that give shareholders an ownership interest in a public company. It&#x;s a real stake in the business, and if you own all the shares of the business, you control how the business operates. The stock market refers to the collection of stocks that can be bought and sold by the general public on a euromoney investor relations of different exchanges.

Where does stock come from? Public companies issue stock so that they can fund their businesses. Investors who think the business will prosper in the future buy those stock issues. The shareholders get any dividends plus any appreciation in the price of the shares. They can also watch their investment shrink or disappear entirely if the mayweather money earned for fight runs out of money.

The stock market is really a kind of aftermarket, where people who own shares in the company can sell them to investors who want to buy them. This trading takes place on a stock exchange, such as the New York Stock Exchange or the Nasdaq. In years past, traders used to go to a physical location &#x; the exchange&#x;s floor &#x; to trade, but now virtually all trading takes place electronically.

When news people say, the market was up today, typically they are referring to the performance of the Standard & Poor&#x;s or the Dow Jones Industrial Average. The S&P is made up of around large publicly traded companies in the U.S, while the Dow includes 30 large companies. These track the performance of the collections of stock and show how they fared on that day of trading and over time.

However, even though people are referring to the Dow and the S&P as the market, those are really indexes of stocks. These indexes represent some of the largest companies in the U.S., but they are not the total market, which includes thousands of publicly traded companies.

Of course, how to invest in the stock market on my own, you&#x;ll need a brokerage account before you start investing in stocks. As you&#x;re getting started, here are eight more guidelines for investing in the stock market.

How to invest in the stock market: 8 tips for beginners

1. Buy the right investment
2. Avoid individual stocks if you&#x;re a beginner
3. Create a diversified portfolio
4. Be prepared for a downturn
5. Try a simulator before investing real money
6. Stay committed to easy business ideas to make money long-term portfolio
7. Start now
8. Avoid short-term trading

1. Buy the right investment

Buying the right stock is so much easier said than done. Anyone can see a stock that&#x;s performed well in the past, but anticipating the performance of a stock in the future is much more difficult. If you want to succeed by investing in individual stocks, you have to be prepared to do a lot of work to analyze a company and manage the investment.

When you start looking at statistics you&#x;ve got to remember that the professionals are looking at each and every one of those companies with much more rigor than you can probably do as an individual, so it&#x;s a very difficult game for the individual to how to invest in the stock market on my own over time, says Dan Keady, CFP, chief financial planning strategist at TIAA.

If you&#x;re analyzing a company, you&#x;ll want to look at a company&#x;s fundamentals &#x; earnings per share (EPS) or a price-earnings ratio (P/E ratio), for example. But you&#x;ll have to do so much more: analyze the company&#x;s management team, evaluate its competitive advantages, study its financials, including its balance sheet and income statement. Even these items are just the start.

Keady says going out and buying stock in your favorite product or company isn&#x;t the right way to go about investing. Also, don&#x;t put too much faith in past performance because it&#x;s no guarantee of the future.

You&#x;ll have to study the company and anticipate what&#x;s coming next, a tough job in good times.

2. Avoid individual stocks if you&#x;re a beginner

Everyone has heard someone talk about a big stock win or a great stock pick.

What they forget about is that often they&#x;re not talking about those particular investments that they also own that did very, very poorly over time, Keady says. So sometimes people have an unrealistic expectation about the kind of returns that they can make in the stock market. And sometimes they confuse luck with skill. You can get lucky sometimes picking an individual stock. It&#x;s hard to be lucky over time and avoid those big downturns also.

Remember, to make money consistently in individual stocks, you need to know something that the forward-looking market isn&#x;t already pricing into the stock price. Keep in mind that for every seller in the market, there&#x;s a buyer for those same shares who&#x;s equally sure they will profit.

There are tons of smart people doing this for a living, and if you&#x;re a novice, how to invest in the stock market on my own, the likelihood of you outperforming that is not very good, says How to invest in the stock market on my own Madsen, CFP, founder of NewLeaf Financial Guidance in Redwood Falls, how to invest in the stock market on my own, Minnesota.

An alternative to individual stocks is an index fund, which can be either a mutual fund or an exchange traded fund (ETF). These funds hold dozens or even hundreds of stocks. And each share you purchase of a fund owns all the companies included in the index.

Unlike stock, mutual funds and ETFs may have annual fees, though some funds are free.

3. Create a diversified portfolio

One of the key advantages of an index fund is that you immediately have a range of stocks in the fund. For example, if you own a broadly diversified fund based on the S&Pyou&#x;ll own stocks in hundreds of companies across many different industries. But you could also buy a narrowly diversified fund focused on one or two industries.

Diversification is important because it reduces the risk of any one stock in the portfolio hurting the overall performance very much, and that actually improves your overall returns. In contrast, if you&#x;re buying only one individual stock, you really do have all your eggs in one basket.

The easiest way to create a broad portfolio is by buying an ETF or a mutual fund. The products have diversification built into them, and you don&#x;t have to do any analysis of the companies held in the index fund.

It may not be the most exciting, but it&#x;s a great way to start, Keady says. And again, it gets you out of thinking that you&#x;re gonna be so smart, that you&#x;re going to be able to pick the stocks that are going to go up, won&#x;t go down and know when to get in and out of them.

When it comes to diversification, that doesn&#x;t just mean many different stocks. It also means investments that are spread among different asset classes &#x; since stock in similar sectors may move in a similar direction for the same reason.

4, how to invest in the stock market on my own. Be prepared for a downturn

The hardest issue for most investors is stomaching a loss in their investments. And because the stock market can fluctuate, you will have losses occur from time to time. You&#x;ll have to steel yourself to handle these losses, or you&#x;ll be apt to buy high and sell low during a panic.

As long as you diversify your portfolio, any single stock that you own shouldn&#x;t have too much of an impact on your overall return. If it does, buying individual stocks might not be the right choice for you. Even index funds will fluctuate, so you can&#x;t get rid of all of your risk, try how you might.

Anytime the market changes we have this propensity to try to pull back or to second guess our willingness to be in, says NewLeaf&#x;s Madsen.

That&#x;s why it&#x;s important to prepare yourself for downturns that could come out of nowhere, as one did in You need to ride out short-term volatility to get attractive long-term returns.

In investing, you need to know that it&#x;s possible to lose money, since stocks don&#x;t how to invest in the stock market on my own principal guarantees. If you&#x;re looking for a guaranteed return, perhaps a high-yield CD might be better.

The concept of market volatility can be difficult for new and even experienced investors to understand, cautions Keady.

One of the interesting things is people will see the market&#x;s volatile because the market&#x;s going down, Keady says. Of course, when it&#x;s going up it&#x;s also volatile &#x; at least from a statistical standpoint &#x; it&#x;s moving all over the place. So it&#x;s important for people to say that the volatility that they&#x;re seeing on the upside, they&#x;ll also see on the downside.

5. Try a stock market simulator before investing real money

One way to enter the world of investing without taking risk is to use a stock simulator. Using an online trading account with virtual dollars won&#x;t put your real money at risk. You&#x;ll also be able to determine how you would react if this really were your money that you gained or lost.

That can be really helpful because it can help people overcome the belief that they&#x;re smarter than the market, Keady says. That they can always pick the best stocks, always buy and sell in the market at the right time.

Asking yourself why you&#x;re investing can help determine if investing in stocks is for you.

If their thought is that they&#x;re going to somehow outperform the market, pick all the best stocks, maybe it&#x;s a good idea to try some type of simulator or watch some stocks and see if you could actually do it, Keady says. Then if you&#x;re more serious about investing over time, then I think you&#x;re much better off &#x; almost all of us, including myself &#x; to have a diversified portfolio such as provided by mutual funds or exchange traded funds.

(Bankrate reviewed some of the best investing apps, including a few fun stock how to invest in the stock market on my own. Stay committed to your long-term portfolio

Keady says investing should be a long-term activity. He also says you should divorce yourself from the daily news cycle.

By skipping the daily financial news, you&#x;ll be able to develop patience, which you&#x;ll need if you want to stay in the investing game for the long term, how to invest in the stock market on my own. It&#x;s also useful to look at your portfolio infrequently, so that you don&#x;t become too unnerved or too elated. These are great tips for beginners who have yet to manage their emotions when investing.

Some of the news cycle, at times it becomes percent negative and it can become overwhelming for people, Keady says.

One strategy for beginners is to set up a calendar and predetermine when you&#x;ll be evaluating your portfolio. Sticking to this guideline will prevent you from selling out of a stock during some volatility &#x; or not getting the full benefit of a well-performing investment, Keady says.

7. Start now

Choosing the perfect opportunity to jump in and invest in the stock market typically doesn&#x;t work well. Nobody knows with percent certainty the best time to get in. And investing is meant to be a long-term activity. There is no perfect time to start.

One of the core points with investing is not just to think about it, but to get started, Keady says. And start now. Because if you invest now, and often over time, that compounding is the thing that can really drive your results. If you want to invest, it&#x;s very important to actually get started and have &#x; an ongoing savings program, so that we can reach our goals over time.

8. Avoid short-term trading

Understanding whether you&#x;re investing for the long-term future or the short term can also help determine your strategy &#x; and whether you should be investing at all. Sometimes short-term investors can have unrealistic expectations about growing their money. And research shows that most short-term investors, such as day traders, lose money. You&#x;re competing against high-powered investors and well-programmed computers that may better understand the market.

To buy stocks, you’ll typically need the assistance of a stockbroker, since you cannot simply call up a stock exchange and ask to buy stocks directly. When invest in gold or stock market use a stockbroker, whether a human being or an online platform, you can choose the investment that you wish to buy or sell and how the trade should be handled.

In this vein, there are two broad categories of brokers to choose from: a full-service broker or an online/discount broker. Below, we discuss how you can use these options to trade stocks on your own. We’ll also talk about a third option: the direct stock purchase plan (DSPP), whereby investors can obtain shares directly from certain public companies.

Where to Buy Stocks

Most of the time, stocks are listed and traded on exchanges, licensed venues where buyers and sellers meet, often with the assistance of a broker or other intermediary. These intermediaries will be members of the exchange and use their access to buy and sell shares on how to invest in the stock market on my own behalf. Major exchanges in the United States include the New York Stock Exchange (NYSE) and the Nasdaq market.

Smaller companies with less liquid shares and minimal market caps (sometimes called penny stocks) may alternatively trade over-the-counter (OTC) on more loosely regulated platforms such as the OTC Pink Sheets. Shares of these companies are often more volatile and risky, so investors choosing to trade on the OTC market how to invest in the stock market on my own engage in extra due diligence and understand the risks involved.

Buying Stocks With a Full-Service Broker

Full-service brokers are what some people visualize when they think about investing—well-dressed businesspeople sitting in an office and chatting with clients. These are the traditional stockbrokers who will take the time to get to know you personally and financially.

They will look at factors such as marital status, lifestyle, personality, risk tolerance, age (time horizon), income, assets, debts, and more. By getting to know as much about you as they can, these full-service brokers can then help you develop a long-term financial plan.

These brokers can not only help you with your investment needs but also provide assistance with estate planning, tax advice, retirement planning, budgeting, and any other type of financial how to invest in the stock market on my own the term “full service.” They can help you manage all of your financial needs now and long into the future and are for investors who want everything in one package.

In terms of fees, full-service brokers are more expensive than discount brokers, but the value of having a professional human investment advisor by your side can be well worth the additional costs. Accounts today can be set up with as little as $1, Most people, especially beginners, would fall into this category in terms of the type of broker whom they require.

Buying Stocks Online

Online/discount brokers, on the other hand, do not provide any investment advice and are basically just order takers. They are much less expensive than full-service brokers, since there is typically no office to visit and no certified investment advisors to help you. Cost is usually based on a per-transaction basis, and you can typically open an account over the Internet with little or no money. Once you have an account with an online broker, you can usually just log on to its website and into your account and be able to buy and sell stocks instantly.

Remember that since these types of brokers provide absolutely no investment advice, stock tips, or investment help of any kind, how to invest in the stock market on my own, you’re on your own to manage your investments. The only assistance that you will usually receive is technical support. Online (discount) brokers do offer investment-related links, research, and resources that can be useful. If you feel that you are knowledgeable enough to take on the responsibilities of managing your own investments, how to invest in the stock market on my own, or if you don’t know anything about investing but want to teach yourself, then this is the way to go.

The bottom line is that your choice of broker should be based on your individual needs. Full-service brokers are great for those who are willing to pay a premium for someone else to look after their finances. Online/discount brokers, on the other hand, are great for people with little start-up money and who would like to take on the risks and rewards of investing upon themselves, without any professional assistance.

Buying Stocks Via a Direct Stock Purchase Plan

Sometimes, companies (often blue-chip firms) will sponsor a special type of program called a direct stock purchase plan (DSPP). DSPPs were originally conceived generations ago as a way for businesses to let smaller investors buy ownership directly from the company. Participating in a DSPP requires an investor to engage with a company directly instead of with a broker, but every company’s system for administering a DSPP is unique.

Participating companies will offer their DSPP through transfer agents or another third-party administrator. To learn more about how to participate in a company’s DSPP, an investor should contact the company’s investor relations department.

How to Trade Once You Have a Broker

Once you’ve chosen your brokerage platform, how to invest in the stock market on my own, you will need to establish and fund an account before you can begin trading. Today, it’s easier than ever to link a bank account online and transfer funds, or to electronically roll over an existing brokerage account to another firm. You can also choose to make recurring deposits into your brokerage account to increase your portfolio on a regular basis.

Once funded, you simply need to go online or call your broker to place a trade. Stocks are designated by a unique ticker symbol, a one- to four-letter mnemonic assigned to a particular company. MSFT, for instance, is the ticker for Microsoft Inc., and AAPL is the ticker for Apple Inc. If you don’t know the ticker of your stock, it is easy to look it up online or via your broker.

When you select the stock ticker that you would like to trade, you’ll be met with a price quote, a set of information about the stock’s price and activity. This will show you the last price at which the shares traded, as well as a bid and an offer. The bid is the highest price at which somebody in the market will buy a share (and thus is the best price at which you can sell to them). The offer, or ask, is the lowest price at which somebody in the market is willing to sell (and thus, it's the best price at which you can buy from them). The difference between the bid and offer prices is known as the spread, how to invest in the stock market on my own. A narrower spread typically indicates that the market for the stock is quite active and liquid. A wider spread indicates the opposite. After how to invest in the stock market on my own the price quote, you may place your order.

Market orders are the most basic type of order and will give you immediate execution at the prevailing market price. A limit order, on the other hand, allows you to set a specific price at which to buy or sell. If the price never reaches that limit level, then the trade will remain active until it is canceled. Many such trades are day orders that will remain good until the end of the trading day. If you want the order to be active only briefly, you can instead specify with your broker that it is immediate or cancel (IOC). Alternatively, if you want the order to remain in force for longer than a day, then you can designate it good ’til canceled (GTC). Other conditions can also be placed on an order, such as a stop-loss.

Once your trade is executed (in whole or in part), you will receive a fill—a summary of your order’s details.

The Bottom Line

You can buy or sell stock on your own by opening a brokerage account with one of the many brokerage firms. After opening your account, connect it with your bank checking account to make deposits, which are then available for you to invest in.

However, do not equate the ease of opening an account with the ease of making good investment decisions. It is generally recommended that beginners speak to a qualified financial advisor. New investors might benefit from reading the key book The Intelligent Investor, by Benjamin Graham. Smart investing can be highly satisfying, so take it slow, do your research, and seek out a broker that suits your interests and goals.

Correction—March 8, A previous version of this article incorrectly specified the definition of the market bid.

Investing is a way to set aside money while you are busy with life and have that money work for you so that you can fully reap the rewards of your labor in the future. Investing is a means to a happier ending. Legendary investor Warren Buffett defines investing as “the process of laying out money now in the expectation of receiving more money in the future.” The goal of investing is to put your money to work in one or more types of investment vehicles in the hopes of growing your money over time.

Let’s say that you have $1, set aside and are ready to enter the world of investing. Or maybe you only have an extra $10 a week and you’d like to get into investing. In this article, we’ll walk you through getting started as an investor and show you how to maximize your returns while minimizing your costs.

What Kind of Investor Are You?

Before you commit your money, you need to answer this question: What kind of investor am I? When opening a brokerage account, an online broker such as Charles Schwab or Fidelity will ask you about your investment goals and what level of risk you’re willing to take.

Some investors want to take an active hand in managing their money’s growth, while others prefer to “set it and forget it.” More traditional online brokers, like the two mentioned above, allow you to invest in stocks, bonds, exchange-traded funds (ETFs), index funds, and mutual funds. 

Online Brokers

Brokers are either full-service or discount. Full-service brokers, as the name implies, give the full range of traditional brokerage services, including financial advice for retirement, healthcare, and everything related to money. They usually only deal with higher-net-worth clients and can charge substantial fees, including a percentage of your transactions, a percentage of your assets that they manage, and sometimes, a yearly membership fee. It’s common to see minimum account sizes of $25, and up at full-service brokerages. Still, traditional brokers justify their high fees by giving advice detailed to your needs.

Discount brokers used to be the exception but are now the norm. Discount online brokers give you tools to select and place your own transactions, and many of them also offer a set-it-and-forget-it robo-advisory service, how to invest in the stock market on my own. As the space of financial services has progressed in the 21st century, online brokers have added more features, including educational materials on their sites and mobile apps.

In addition, although there are a number of discount brokers with no (or very low) minimum deposit restrictions, you may be faced with other restrictions, and certain fees are charged to accounts that don’t have a minimum deposit. This is something that an investor should take into account if they want to invest in stocks.

Robo-Advisors

After the financial crisis, a new breed of investment advisor was born: the roboadvisor. Jon Stein and Eli Broverman of Betterment are often credited as the first in the space. Their mission was to use technology to lower costs for investors and streamline investment advice.

Since Betterment launched, other robo-first companies have been founded, and even established online brokers like Charles Schwab have how to invest in the stock market on my own robo-like advisory services. According to a report by Charles Schwab, 58% of Americans say they will use some sort of robo advice by If you want an algorithm to make investment decisions for you, including tax-loss harvesting and rebalancing, then a roboadvisor may be for you. Also, as the success of index investing how to invest in the stock market on my own shown, you might do better with a roboadvisor if your goal is long-term wealth building.

Investing Through Your Employer

If you’re on a tight budget, try to invest just 1% of your salary into the retirement plan available to you at work. The truth is you probably won’t even miss a contribution that small.

Work-based retirement plans deduct your contributions from your paycheck before taxes are calculated, which will make the contribution even less painful. When you’re comfortable with a 1% contribution, maybe you can increase it as you get annual raises. You’re unlikely to miss the additional contributions. If you have a (k) retirement account at work, then you may be investing in your future already with allocations to mutual funds and even your own company’s stock.

Minimums to Open an Account

Many financial institutions have minimum deposit requirements. In other words, they won’t accept your account application unless you deposit a certain amount of money. Some firms won’t even allow you to open an account with a sum as small as $1,

It pays to shop around some and check out our broker reviews before deciding where you want to open an account. We list minimum deposits at the top of each review. Some firms do not require minimum deposits. Others may often best mutual funds to invest 2022 usa costs, such as trading fees and account management fees if you have a balance above a certain threshold. Still others may offer a certain number of commission-free trades for opening an account.

Commissions and Fees

As economists like to say, there ain’t no such thing as a free lunch. Though many brokers have been racing recently to lower or eliminate commissions on trades, and ETFs offer index investing to everyone who can trade with a bare-bones brokerage account, all brokers have to make money from their customers one way or another.

In most cases, your broker will charge a commission every time you trade stock, either through buying or selling. Trading fees range from the low end of $2 per trade but can be as high as $10 for some discount brokers. Some brokers charge no trade commissions at all, but they make up for it in other ways. There are no charitable organizations running brokerage services.

Depending on how often you trade, these fees can add up and affect your profitability. Investing in stocks can be very costly if you hop into and out of positions frequently, especially with a small amount of money available to invest.

Remember, a trade is an order to purchase or sell shares in one company. If you want to purchase five different stocks at the same time, this is seen as five separate trades, and you will be charged for each one.

Now, imagine that you decide to buy the stocks of those five companies with your $1, To do this, you will incur $50 in trading costs—assuming the fee is $10—which is equivalent to 5% of your $1, If you were to fully invest the $1, how to invest in the stock market on my own, your account would be reduced to $ after trading costs. This represents a 5% loss before your investments even have a chance to earn.

Should you sell these five stocks, you would once again incur the costs of the trades, which would be another $ To make the round trip (buying and selling) on these five stocks would cost you $, or 10% of your initial deposit amount of $1, If your investments do not earn enough to cover this, you have lost money just by entering and exiting positions.

Mutual Fund Loads

Besides the trading fee to purchase a mutual fund, there are other costs associated with this type of investment. Mutual funds are professionally managed pools of investor funds that invest in a focused manner, such as large-cap U.S. stocks.

An investor will incur many fees when investing in mutual funds. One of the most important fees to consider is the management expense ratio (MER), which is charged by the management team each year based on the number of assets in the fund. The MER ranges from % to % annually and varies depending on the type of fund. But the higher the MER, the more it affects the fund’s overall returns.

You may see a number of sales charges called loads when you buy mutual funds. Some are front-end loads, but you will also see no-load and back-end load funds. Be sure that you understand whether a fund that you are considering carries a sales load prior to buying it. Check out your broker’s list of no-load funds and no-transaction-fee funds if you want to avoid these extra charges.

For the beginning investor, mutual fund fees are actually an advantage compared to commissions on stocks. This is because the fees are the same regardless of the amount that you invest. Therefore, as long as you meet the minimum requirement to open an account, you can invest as little as $50 or $ per month in a mutual fund. The term for this is called dollar-cost averaging (DCA), how to invest in the stock market on my own, and it can be a great way to start investing.

Diversify and Reduce Risks

Diversification is considered to be the only free lunch in investing. In a nutshell, by investing in a range of assets, you reduce the risk of one investment’s performance severely hurting the return of your overall investment. You could think of it as financial jargon for “Don’t put all of your eggs in one basket.”

In terms of diversification, the greatest difficulty in doing this will come how to invest in the stock market on my own investments in stocks. As mentioned earlier, the costs of investing in a large number of stocks could be detrimental to the portfolio, how to invest in the stock market on my own. With a $1, deposit, it is nearly impossible to have a well-diversified portfolio, so be aware that you may how to invest in the stock market on my own to invest in one or two companies (at the most) in the first place. This will increase your risk.

This is where the major benefit of mutual funds or ETFs comes into focus. Both types of securities tend to have a large number of stocks and other investments within their funds, which makes them more diversified than a single stock.

Stock Market Simulators

People new to investing who wish to gain experience trading without risking their money in the process may find that a stock market simulator is a valuable tool. There are a wide variety of trading simulators available, including those with and without fees. Investopedia's simulator is entirely free to use.

Stock market simulators offer users imaginary, virtual money to "invest" in a portfolio of stocks, options, ETFs, or other securities. These simulators typically track price movements of investments and, depending on the simulator, other notable considerations such as trading fees or dividend payouts. Investors make virtual "trades" as if they were investing real money. Through this process, simulator users have the opportunity to learn about the ins and outs of investing—and to experience the consequences of their virtual investment decisions—without running the risk of putting their own money on the line. Some simulators even allow users to compete against other participants, providing an additional incentive to invest thoughtfully.

The Bottom Line

It is possible to invest if you are just starting out with a small amount of money. It’s more complicated than just selecting the right investment (a feat that is difficult enough in itself), and you have to be aware of the restrictions that you face as a new investor.

You’ll have to do your homework to find the minimum deposit requirements and then compare the commissions to those of other brokers. Chances are that you won’t be able to cost-effectively buy individual stocks and still diversify with a small amount of money. You will also need to choose the broker with which you would like to open how to invest in the stock market on my own account.

Matthew Frankel, CFP

Updated: March 21,p.m.

The steps to investing might be better described as a journey. One core element of this journey is to continually invest money in the market.

When you buy shares in one of these companies — even a very small number of shares — you then own a small part of that business.

You need to use a third party, called a ‘broker’, to conduct the actual transaction of buying or selling shares.

How can I make money from shares?

People aim to make money from investing in shares through one, or both, of the following ways:

An increase in share price. Usually known as ‘capital growth’ or ‘capital gain’, all this means is that you make money by buying your shares for one price and selling them for a higher price. Conversely, it’s important to remember that if the share price falls below the amount you paid and you sell your shares at this lower price, you would lose money.

A share in the company’s profits. Usually known as ‘dividends’, these payments are a portion of company profits paid out to shareholders, usually twice a year. Companies don’t have to pay dividends, but many see it as a way of returning earnings to their shareholders.

Isn’t my money safer in a savings account?

It’s true that savings accounts and term deposits are a less risky type of investment, and it is generally recommended you keep some of your money in these assets.

But investing in shares can give your money the chance to earn better returns than it would if you left it in a bank account.  

Taking the first steps

Thinking about why you want to invest can help you work out your strategy and avoid making irrational decisions down the track. Ask yourself a few key questions:

• How long do you want to put money into the stock market for?
• How much are you going to invest?
• Are you going to make regular contributions?

How do you learn to invest?

The sooner you start to get the knowledge you need, the quicker you can get to a point where you can feel confident.

It’s important to educate yourself about the economy, interest rates, exchange rates and government policy, and understand how these factors may affect a company’s performance, says the Australian Government’s MoneySmart website.

The ASX also has a share investing education section on its website.

CommSec Pocket lets you invest anytime, anywhere, with as little as $ Choose from seven themed investment options to easily invest in something that appeals to you – like tech, sustainability leaders, or the biggest companies on the Australian market. Gain experience by using the app and CommSec will help you along the way with bite-sized tips, videos, and articles to teach you all about the share market.

How much do you need?

Most brokers would require the first trade to be at least $ which would be referred to as the 'minimum marketable parcel of shares'. The size of increments or additional purchases thereafter would be at the individual broker's discretion.

The ASX suggests you should “start your share investing with at least $2,” as a general guide. Understanding the costs involved should help you decide how much you want to invest.

Starting small

When you buy or sell shares, each individual transaction incurs a brokerage fee in addition to the price of the shares themselves. This means the less you invest, the more the fees will be as a percentage of your total investment.

For example:

• If brokerage costs you $ and you buy $ worth of shares, brokerage will represent just over % of your investment.
• If brokerage costs you $ and you buy $5, worth of shares, brokerage will represent % of your investment.

The point is, if you start with a small amount of money, the company you invest in may have to perform far above the average rate of return for you to make enough money to even cover your costs, let alone turn a profit, when you eventually sell your shares.

On the other hand, it is important to understand shares are considered the riskiest type of investment and the more money you invest, the more of your savings you are effectively opening up to that risk. You need to be comfortable with the possibility of losing the money you put into the share market.

How do you choose which shares to buy?

Researching and choosing companies to invest in can be enjoyable and there are lots of tips and recommendations to guide you through the process.

MoneySmart suggests starting with companies in an industry that you know something about, as this may make it easier for you to understand how a business is doing.

What to look for?

While past financial performance and achievements can be important indicators of the stability of a business, what really drives share prices is a company’s future outlook.

MoneySmart recommends asking questions like:

• Will the goods and services this company provides be in demand in the future?
• Are there opportunities for the company to grow?
• Who are the company’s competitors and are they in a strong position?

Sources such as a company’s annual report, as well as its yearly and half-yearly financial results statements, can be good places to find relevant information. These can be found by searching for the company name on the ASX website.

Cheap but uncheerful

Cheap shares don’t always represent good value for money.

While ‘penny stocks’, for example, might look cheap at 10 to 20 cents per share, a small company with a shaky track record has the potential to wipe out your money fast.

Just because you can buy 5, shares at $ each with your $1,, doesn’t mean this is better value than purchasing 15 to 20 shares valued at around $60 per share. What matters when it comes to making money is not how many shares you own, but how much each share increases in value.

Be wary, too, of buying shares just because prices are falling. A company may have announced a profit downgrade or a change in its situation that materially damages its future chances of making money, which is causing its share price to fall.

Look at companies’ share price charts for a historical view of share value. If a share price has been falling over the long term, that company would probably be considered a high risk investment.

Not rising too quickly?

On the other hand, rapid and significant share price growth can also be cause for concern.

As mentioned above, share prices generally rise when a company makes a positive announcement about its future – for example, a contract for new business, a profit forecast or a sales outlook.

But if the share value grows too quickly and the company doesn't deliver on its forecast, the prices might fall again as the shares become less desirable.

Basically, price is definitely important when choosing shares, but it should always be considered as part of a range of factors.

How much are you willing to lose?

Selling decisions are as critical as buying decisions to your results in the share market, MoneySmart notes.

Consider setting yourself a ‘percentage stop’ of around 15% for each company you buy shares in. This means deciding how much of your originally invested money you are willing to lose. Once a company’s share price falls below this amount, you commit to selling those shares. Otherwise, losses in one company may wipe out gains in the rest of your portfolio.

Welcome Students!

What would you do if you were given $,? Would you spend it all at once? Would you think about putting some of it in the bank? We’d like to teach you how to invest it, so you might grow it. Through The Stock Market Game (SMG), you will gain a fundamental understanding of investing and how you might get your money to work for you.

The Stock Market Game will also help you do better in school. When you participate in The Stock Market Game, you are in a real-world situation where you practice the content and skills you’re taught in math, English Language Arts, economics, social studies, and other school subjects. Most importantly, The Stock Market Game will help you develop positive money habits and prepare you for your future

FAQ

Can I use The Stock Market Game on my own?

Yes, just because your school is not teaching you about investing for your future, doesn’t mean you can’t learn it on your own or with a group of your friends. However, in order to register, you have to be 18 years or older. If you are under 18, ask your teacher, an adult family member, or another trustworthy adult to complete the SMG online registration form. They will receive an ID and password that they can share with you. Contact your local Stock Market Game coordinator if you have any questions about this. You can find your local Stock Market Game coordinator by Clicking Here, selecting “View Programs in My Area,” and entering your zip code. If you are not 18 years or older, ask an adult to contact your local Stock Market Game coordinator.

How do I get started?

If you are 18 years old or older, Click Register to get started.

If you are younger than 18 years old, ask your teacher, an adult family member, or another trustworthy adult to Click Register to access the online registration page. Register as a “Teacher With Classes.”

Your local SMG program’s registration page provides essential information on program requirements and important dates. SMG is a national program of the SIFMA Foundation and is coordinated locally by non-profit partners who are dedicated to youth financial literacy. If you need additional assistance, please contact your local SMG coordinator or the SIFMA Foundation office by email at smg@www.oldyorkcellars.com or phone:

Where do I begin after I’ve registered?

If you are 18 years old or older go to www.oldyorkcellars.com to login with the SMG username and password you received via email. Once you have been logged in you can familiarize yourself with the online SMG investment portfolio by clicking on the Help menu links available on each page of the portfolio. Click the Rules link to familiarize yourself with The Stock Market Game’s trading rules. If you need additional help, contact your local Stock Market Game coordinator.

If you are younger than 18 years old, ask the teacher, adult family member, or adult who registered to share with you the SMG team username and password they received via email. Use the SMG team username and password you have been given to login at www.oldyorkcellars.com Once you have been logged in you can familiarize yourself with the online SMG investment portfolio by clicking on the Help menu links available on each page of the portfolio. Click the Rules link to familiarize yourself with The Stock Market Game’s trading rules. If you need additional help, ask an adult to contact your local Stock Market Game coordinator.

What is the Teacher Support Center?

The Teacher Support Center is a searchable library of lesson plans, learning activities, and assessments that help teachers introduce their students to fundamental saving and investing topics as well as provide real world practice in core academic subjects like math, English, and social studies (economics). The Teacher Support Center is only available to participants who registered as “Teachers with Classes.”

There are two types of usernames and passwords: (1) Advisor and (2) Team. The Advisor username and password gives you access to the Teacher Support Center. The Team username and password gives you access to the SMG trading portfolio. Go to www.oldyorkcellars.com to login to both the Teacher Support Center and team portfolio.

If you are 18 years old or older, you receive via email a message with your Advisor username and password as soon as you successfully register. Your team username and password will be sent shortly after in a separate email message.

If you are younger than 18 years old, the adult who registered you will immediately receive an email message with their Advisor username and password. Your team username and password will follow shortly via email to the adult who registered you.

Do you have materials for afterschool and homeschool use?

Yes, the Teacher Support Center has easy-to-follow instructional guides, suggested lessons, activities, and projects for afterschool and homeschool participants. Though afterschool and homeschool resources are designed specifically for their respective audiences, they may be used interchangeably with each other or with educational materials designed for classroom participants.

How do I get my teacher to use The Stock Market Game?

The best way to get your teacher excited about using The Stock Market Game in school is to show him or her your Stock Market Game portfolio. Walk them through some of the decisions you made as you managed your portfolio. Encourage your teacher to attend a local training workshop or webinar. Give them the contact information for your local Stock Market Game coordinator and be sure to share the SMG link: www.oldyorkcellars.com

• You can start investing in stocks through a brokerage account or by using a robo-advisor.
• But you should establish goals, review your financial situation, and determine your risk tolerance first.
• Rebalancing your portfolio periodically will help you keep your investments in good shape.
• Visit Insider's Investing Reference library for more stories.

Looking to maximize your money and beat the cost of inflation? You want to invest in the stock market to get higher returns than your average savings account. But learning how to invest in stocks can be daunting for someone just getting started. 

When you invest in stocks, you're purchasing a share of a company. They're basically a slice of ownership in a company that can yield returns if it's successful. There are various ways to invest and leverage your money. But there's a lot to know before you get started investing in stocks. 

Step 1: Figure out your goals 

It's important to know what your fundamental goals are and why you want to start investing in the first place. Knowing this will help you to set clear goals to work toward. This is a crucial first step to take when you're looking to create an investing strategy later on. 

If you're unsure of your goals, first review your financial situation, such as how much debt you have, your after-tax income, and expected retirement goal date. Knowing when you plan to retire can let you know your overall time horizon — or how much time you plan to hold onto your investments to reach your financial goal. 

Based on that information, you can start figuring out your investing goals. Do you want to invest for the short or long term? Are you saving for a down payment on a house? Or are you trying to build your nest egg for retirement? All of these situations will affect how much — and how aggressively — to invest.

Finally, investing, like life, is inherently risky And you can lose money as easily as you can earn it. For your financial and mental wellbeing, you want to consider your appetite for risk. This is typically referred to as "risk tolerance" or how much risk you can reasonably take on given your financial situation and feelings about risk. 

Quick Tip: You can take this investment risk tolerance quiz created by Rutgers to see where you stand and help inform your asset allocation.

Step 2: Determine your budget 

Once you've got some solid goals set, it's time to review your budget. Here are some things to consider:

• Your current after-tax income. Many people look at their pre-tax income, but you want to know how much money you're working with after taxes which can help you create a realistic budget. 
• Your expenses. How much are your monthly expenses? How much do you have leftover each month? Is it possible to reduce or cut some expenses? 
• Overall debt. How much debt do you currently have? List out your monthly payments and compare that against what you're making.
• Net worth. Your net worth is your total assets minus your liabilities. This number can give you an idea of where you're at financially and will allow you to get a "big-picture" snapshot of your financial health. 
• Financial goals. As we mentioned before, knowing your goals is important as it gives your money a purpose. 
• Risk tolerance. How much risk do you feel comfortable taking on? Calculating this will give you a clearer idea of what you can afford to lose.
• Time horizon. How much time do you have before you want to reach your investing goals? This is key to mapping out your finances to ensure you're keeping pace with when and how to invest without disrupting your budget or other goals not related to trading securities.

All of these are key ingredients that can help you determine your budget. 

One last thing to consider: when you expect to retire. For example, if you have 30 years to save for retirement, you can use a retirement calculator to assess how much you might need and how much you should save each month. When setting a budget, make sure you can afford it and that it is helping you reach your goals. 

Step 3: Get acquainted with various stocks and funds 

Now it's time to start doing research on what to invest in. There are different ways to invest in the stock market and there's a lot to know so doing your research is well worth your time.

Stocks are a good option to consider if you want to invest in specific companies. Just keep in mind that you should look into the company itself and how it's performing over time:

• Stocks — A stock is a security that gives stockholders the opportunity to buy a fractional share of ownership in a particular company. There are many different types of stocks to choose from, such as blue-chip stocks, growth stocks, and penny stocks, so make sure you understand your options, what they offer, and what matches with your budget and investing goals.

"If you're going to pick a stock, look at the [company's] financial statements and select the stock based on the "bucket" you're trying to fill in your portfolio. For example, are you looking for a dividend stock? Look at the dividend history. Are you looking for a growth stock? Look at the earnings per share: Is it showing consistent growth? [Consider] how these indicators measure against [its] peer group," says Amy Irvine, a certified financial planner at Rooted Planning Group. 

So you want to take steps to look at your income and expense balance sheets and make sure you're hitting the right bucket — which refers to the grouping of related assets or categories — for your investing needs. For example, investing in small-cap, mid-cap, or large-cap stocks, are a way to invest in different-sized companies with varying market capitalizations and degrees of risk. 

If you're looking to go the DIY route or want the option to have your securities professionally managed, you can consider ETFs, mutual funds, or index funds:

• Exchange-traded funds (ETFs) — ETFs are a type of exchange-traded investment product that must register with the SEC and allows investors to pool money and invest in stocks, bonds, or assets that are traded on the US stock exchange. There are two types of ETFs: Index-based ETFs and actively managed ETFs. Index-based ETFs track a particular securities index like the S&P and invest in those securities contained within that index. Actively managed ETFs aren't based on an index and instead aim to achieve an investment objective by investing in a portfolio of securities that will meet that goal and are managed by an advisor. 

• Mutual funds — this investment vehicle also allows investors to pool their money to invest in various assets, and are similar to some ETFs in that way. However, mutual funds are always actively managed by a fund manager. Most mutual funds fall into one of four main categories: bond funds, money market funds, stock funds, and target-date funds. 

• Index funds — this type of investment vehicle is a mutual fund that's designed to track a particular index such as the S&P Index funds invest in stocks or bonds of various companies that are listed on a particular index. 

Quick tip: Wondering just how much certain mutual funds will cost you? You can use FINRA's Fund Analyzer tool to help you examine and compare the costs of owning funds.

You want to get familiar with the various types of investing vehicles and understand the risks and rewards of each type of security. For example, stocks can be lucrative but also very risky. As we mentioned before, mutual funds are actively managed, whereas index-based ETFs and index funds are passively managed. 

This is important to keep in mind because your costs and responsibilities vary depending on an active versus passive approach. Mutual funds are professionally managed and may have higher fees. With ETFs and index funds, you can purchase them yourself and may have lower fees. Having a diverse portfolio can help you prepare for the risk and not have all of your eggs in one basket. 

"You can choose to invest in individual stocks, a stock mutual fund, or an ETF. ETFs are somewhat similar to mutual funds in that they invest in many stocks, but trade more similarly to an individual stock," explains Kenny Senour, certified financial planner at Millennial Wealth Management. "For example, let's say you open a brokerage account with $1, You can use that money to purchase a certain number of shares in ABC Company, the underlying price of which fluctuates while the stock market is open. Or you could choose to invest it in a stock mutual fund, which invests in many different stocks and is priced at the close of each market at the end of the day." 

Quick tip: Building a diversified portfolio with individual stocks can be time-consuming, especially for people just starting out. That's why experts recommend beginner investors focus on mutual funds, index funds, or ETFs, which give you a large selection of stocks in one go.

Step 4: Define your investing strategy

The main things to consider when defining your investment strategy are your time horizon, your financial goals, risk tolerance, tax bracket, and your time constraints. Based on this information, there are two main approaches to investing.

• Passive investing — an investing strategy that takes a buy-and-hold approach, passive investing is a way to DIY your investments for maximum efficiency over time. In other words, you can do it yourself instead of working with a professional. A buy-and-hold strategy focuses on buying investments and holding on to them as long as possible. Instead of trying to "time" the market, you focus on "time in the market."
• Active investing — an active approach to investing that requires buying and selling, based on market conditions. You can do this yourself or have a professional manager managing your investments. Active investing takes the opposite approach, hoping to maximize gains by buying and selling more frequently and at specific times.

Quick Tip: Be aware of any fees or related costs when investing. Fees can take a bite out of your investments, so compare costs and fees.

Step 5: Choose your investing account 

After choosing your investment strategy, you want to choose an investing account that can help you get started. Decide if you want to do it yourself or get a professional to help out. 

If you want to be a passive investor and DIY, you can look into:

If you want to get started with active investing, you can use:

When considering active versus passive investing and if you should DIY it or get a professional, you want to consider several factors. Look at total fees, the time commitment involved and any account minimums as well. 

The easiest way for many people to get started with investing is to utilize their employer-sponsored (k). Talk to your employer about getting started and see if they'll match part of your contributions. 

The key is to choose an investment account that fits with your budget and investment strategy, open an account, and then submit an initial deposit. Just know that when you submit money, it's in a cash settlement account and not yet actively invested (I made this mistake when I first started investing!) 

Step 6: Manage your portfolio 

Now it's time to start managing your portfolio. So that means buying stocks, ETFs, or index funds with their appropriate codes from your account. That is when your money is actually invested. 

But it doesn't stop there — you also want to continue to add to your portfolio so consider setting up auto-deposits each month. You can also re-invest any earnings or dividends to help build growth over time.  

Diversify your portfolio by investing in different types of investment vehicles and industries. A buy-and-hold approach is typically better for beginner investors. It can be tempting to try out day trading, but that can be very risky. 

Quick tip: To limit risk, avoid day trading, penny stocks, and industries you don't understand.

Lastly, you'll want to rebalance your portfolio at least once a year. As your portfolio grows and dips, your asset allocation — or how much you've invested in stocks, bonds, and cash — will have shifted. Rebalancing is basically resetting that to the proportion you want. 

"Rebalancing is the practice of periodically selling and buying investments in your underlying portfolio to make sure certain target weights are stable over time. For example, let's say you are an aggressive investor with 90% of your portfolio in stocks and 10% of your portfolio in bonds. Over time, as stocks and bonds perform differently, those weights will drift," explains Senour. 

"Without periodic rebalancing, your portfolio could become 95% stocks and 5% bonds which may not be in line with your intended financial goals for the account. There's no "perfect" time frame for rebalancing as some financial professionals suggest doing so every quarter, but conventional wisdom says at a minimum rebalancing at least once per year can make sense."

Continuing to invest money and rebalance your portfolio periodically will help you keep your investments in good shape. 

Helpful resources

Need help with learning how to invest in stocks? Here are some top investing books to help you get started.

• "The Intelligent Investor" by Benjamin Graham: This comprehensive book will help you get started with investing and has been considered a "stock-market bible." 
• "Broke Millennial Takes On Investing" by Erin Lowry: This how-to guide will walk you through how to invest in stocks and break down the terms in a straightforward, digestible way. 
• "A Random Walk Down Wall Street" by Burton G. Malkiel: This best-seller has been hailed as a go-to for investors and covers the range of investment opportunities and helps you get started on your investment journey. 
• "How to Buy Stocks" by Louis Engel and Henry R. Hecht: Considered a "classic" guide on how to buy stocks and what you should know about regulations.

The financial takeaway

Learning how to invest in stocks can be overwhelming, especially if you're just getting started. Figuring out your goals and determining a budget are the first steps to take.

After that, get acquainted with various investment vehicles and choose the right ones for your financial goals and risk tolerance.

The key is to get started and be consistent. The best investment strategy is the one you'll stick with. Just be aware all investing comes with risk and do your research on any related fees. 

When you buy through our links, Insider may earn an affiliate commission.

Matthew Frankel, CFP

Updated: March 21, , p.m.

The steps to investing might be better described as a journey. One core element of this journey is to continually invest money in the market.

News shows, Hollywood films, and TV all assume that you know what the stock market is and how it works. Everyone knows that you can make a lot of money in the stock market if you know what you&#x;re doing, but beginners don&#x;t often understand how the market works and exactly why stocks go up and down.

Here&#x;s what you need to know about the stock market before you start investing.

What is the stock market?

Stocks, which are also called equities, are securities that give shareholders an ownership interest in a public company. It&#x;s a real stake in the business, and if you own all the shares of the business, you control how the business operates. The stock market refers to the collection of stocks that can be bought and sold by the general public on a variety of different exchanges.

Where does stock come from? Public companies issue stock so that they can fund their businesses. Investors who think the business will prosper in the future buy those stock issues. The shareholders get any dividends plus any appreciation in the price of the shares. They can also watch their investment shrink or disappear entirely if the company runs out of money.

The stock market is really a kind of aftermarket, where people who own shares in the company can sell them to investors who want to buy them. This trading takes place on a stock exchange, such as the New York Stock Exchange or the Nasdaq. In years past, traders used to go to a physical location &#x; the exchange&#x;s floor &#x; to trade, but now virtually all trading takes place electronically.

When news people say, the market was up today, typically they are referring to the performance of the Standard & Poor&#x;s or the Dow Jones Industrial Average. The S&P is made up of around large publicly traded companies in the U.S, while the Dow includes 30 large companies. These track the performance of the collections of stock and show how they fared on that day of trading and over time.

However, even though people are referring to the Dow and the S&P as the market, those are really indexes of stocks. These indexes represent some of the largest companies in the U.S., but they are not the total market, which includes thousands of publicly traded companies.

Of course, you&#x;ll need a brokerage account before you start investing in stocks. As you&#x;re getting started, here are eight more guidelines for investing in the stock market.

How to invest in the stock market: 8 tips for beginners

1. Buy the right investment
2. Avoid individual stocks if you&#x;re a beginner
3. Create a diversified portfolio
4. Be prepared for a downturn
5. Try a simulator before investing real money
6. Stay committed to your long-term portfolio
7. Start now
8. Avoid short-term trading

1. Buy the right investment

Buying the right stock is so much easier said than done. Anyone can see a stock that&#x;s performed well in the past, but anticipating the performance of a stock in the future is much more difficult. If you want to succeed by investing in individual stocks, you have to be prepared to do a lot of work to analyze a company and manage the investment.

When you start looking at statistics you&#x;ve got to remember that the professionals are looking at each and every one of those companies with much more rigor than you can probably do as an individual, so it&#x;s a very difficult game for the individual to win over time, says Dan Keady, CFP, chief financial planning strategist at TIAA.

If you&#x;re analyzing a company, you&#x;ll want to look at a company&#x;s fundamentals &#x; earnings per share (EPS) or a price-earnings ratio (P/E ratio), for example. But you&#x;ll have to do so much more: analyze the company&#x;s management team, evaluate its competitive advantages, study its financials, including its balance sheet and income statement. Even these items are just the start.

Keady says going out and buying stock in your favorite product or company isn&#x;t the right way to go about investing. Also, don&#x;t put too much faith in past performance because it&#x;s no guarantee of the future.

You&#x;ll have to study the company and anticipate what&#x;s coming next, a tough job in good times.

2. Avoid individual stocks if you&#x;re a beginner

Everyone has heard someone talk about a big stock win or a great stock pick.

What they forget about is that often they&#x;re not talking about those particular investments that they also own that did very, very poorly over time, Keady says. So sometimes people have an unrealistic expectation about the kind of returns that they can make in the stock market. And sometimes they confuse luck with skill. You can get lucky sometimes picking an individual stock. It&#x;s hard to be lucky over time and avoid those big downturns also.

Remember, to make money consistently in individual stocks, you need to know something that the forward-looking market isn&#x;t already pricing into the stock price. Keep in mind that for every seller in the market, there&#x;s a buyer for those same shares who&#x;s equally sure they will profit.

There are tons of smart people doing this for a living, and if you&#x;re a novice, the likelihood of you outperforming that is not very good, says Tony Madsen, CFP, founder of NewLeaf Financial Guidance in Redwood Falls, Minnesota.

An alternative to individual stocks is an index fund, which can be either a mutual fund or an exchange traded fund (ETF). These funds hold dozens or even hundreds of stocks. And each share you purchase of a fund owns all the companies included in the index.

Unlike stock, mutual funds and ETFs may have annual fees, though some funds are free.

3. Create a diversified portfolio

One of the key advantages of an index fund is that you immediately have a range of stocks in the fund. For example, if you own a broadly diversified fund based on the S&P , you&#x;ll own stocks in hundreds of companies across many different industries. But you could also buy a narrowly diversified fund focused on one or two industries.

Diversification is important because it reduces the risk of any one stock in the portfolio hurting the overall performance very much, and that actually improves your overall returns. In contrast, if you&#x;re buying only one individual stock, you really do have all your eggs in one basket.

The easiest way to create a broad portfolio is by buying an ETF or a mutual fund. The products have diversification built into them, and you don&#x;t have to do any analysis of the companies held in the index fund.

It may not be the most exciting, but it&#x;s a great way to start, Keady says. And again, it gets you out of thinking that you&#x;re gonna be so smart, that you&#x;re going to be able to pick the stocks that are going to go up, won&#x;t go down and know when to get in and out of them.

When it comes to diversification, that doesn&#x;t just mean many different stocks. It also means investments that are spread among different asset classes &#x; since stock in similar sectors may move in a similar direction for the same reason.

4. Be prepared for a downturn

The hardest issue for most investors is stomaching a loss in their investments. And because the stock market can fluctuate, you will have losses occur from time to time. You&#x;ll have to steel yourself to handle these losses, or you&#x;ll be apt to buy high and sell low during a panic.

As long as you diversify your portfolio, any single stock that you own shouldn&#x;t have too much of an impact on your overall return. If it does, buying individual stocks might not be the right choice for you. Even index funds will fluctuate, so you can&#x;t get rid of all of your risk, try how you might.

Anytime the market changes we have this propensity to try to pull back or to second guess our willingness to be in, says NewLeaf&#x;s Madsen.

That&#x;s why it&#x;s important to prepare yourself for downturns that could come out of nowhere, as one did in You need to ride out short-term volatility to get attractive long-term returns.

In investing, you need to know that it&#x;s possible to lose money, since stocks don&#x;t have principal guarantees. If you&#x;re looking for a guaranteed return, perhaps a high-yield CD might be better.

The concept of market volatility can be difficult for new and even experienced investors to understand, cautions Keady.

One of the interesting things is people will see the market&#x;s volatile because the market&#x;s going down, Keady says. Of course, when it&#x;s going up it&#x;s also volatile &#x; at least from a statistical standpoint &#x; it&#x;s moving all over the place. So it&#x;s important for people to say that the volatility that they&#x;re seeing on the upside, they&#x;ll also see on the downside.

5. Try a stock market simulator before investing real money

One way to enter the world of investing without taking risk is to use a stock simulator. Using an online trading account with virtual dollars won&#x;t put your real money at risk. You&#x;ll also be able to determine how you would react if this really were your money that you gained or lost.

That can be really helpful because it can help people overcome the belief that they&#x;re smarter than the market, Keady says. That they can always pick the best stocks, always buy and sell in the market at the right time.

Asking yourself why you&#x;re investing can help determine if investing in stocks is for you.

If their thought is that they&#x;re going to somehow outperform the market, pick all the best stocks, maybe it&#x;s a good idea to try some type of simulator or watch some stocks and see if you could actually do it, Keady says. Then if you&#x;re more serious about investing over time, then I think you&#x;re much better off &#x; almost all of us, including myself &#x; to have a diversified portfolio such as provided by mutual funds or exchange traded funds.

(Bankrate reviewed some of the best investing apps, including a few fun stock simulators.)

6. Stay committed to your long-term portfolio

Keady says investing should be a long-term activity. He also says you should divorce yourself from the daily news cycle.

By skipping the daily financial news, you&#x;ll be able to develop patience, which you&#x;ll need if you want to stay in the investing game for the long term. It&#x;s also useful to look at your portfolio infrequently, so that you don&#x;t become too unnerved or too elated. These are great tips for beginners who have yet to manage their emotions when investing.

Some of the news cycle, at times it becomes percent negative and it can become overwhelming for people, Keady says.

One strategy for beginners is to set up a calendar and predetermine when you&#x;ll be evaluating your portfolio. Sticking to this guideline will prevent you from selling out of a stock during some volatility &#x; or not getting the full benefit of a well-performing investment, Keady says.

7. Start now

Choosing the perfect opportunity to jump in and invest in the stock market typically doesn&#x;t work well. Nobody knows with percent certainty the best time to get in. And investing is meant to be a long-term activity. There is no perfect time to start.

One of the core points with investing is not just to think about it, but to get started, Keady says. And start now. Because if you invest now, and often over time, that compounding is the thing that can really drive your results. If you want to invest, it&#x;s very important to actually get started and have &#x; an ongoing savings program, so that we can reach our goals over time.

8. Avoid short-term trading

Understanding whether you&#x;re investing for the long-term future or the short term can also help determine your strategy &#x; and whether you should be investing at all. Sometimes short-term investors can have unrealistic expectations about growing their money. And research shows that most short-term investors, such as day traders, lose money. You&#x;re competing against high-powered investors and well-programmed computers that may better understand the market.

For more information about Vanguard funds or ETFs, visit www.oldyorkcellars.com to obtain a prospectus or, if available, a summary prospectus. Investment objectives, risks, charges, expenses, and other important information about a fund are contained in the prospectus; read and consider it carefully before investing.

*For market orders on the Standard & Poor’s Index sizes – for the month period ended December 31,  

**Options are a leveraged investment and aren't suitable for every investor. Options involve risk, including the possibility that you could lose more money than you invest. Before buying or selling options, you must receive a copy of Characteristics and Risks of Standardized Options issued by OCC. A copy of this booklet is available at www.oldyorkcellars.com It may also be obtained from your broker, any exchange on which options are traded, or by contacting OCC at S. Franklin Street, Suite , Chicago, IL ( or OPTIONS). The booklet contains information on options issued by OCC. It's intended for educational purposes. No statement in the booklet should be construed as a recommendation to buy or sell a security or to provide investment advice. Call The Options Industry Council (OIC) helpline at OPTIONS or visit www.oldyorkcellars.com for more information. The OIC can provide you with balanced options education and tools to assist you with your options questions and trading.

All investing is subject to risk, including the possible loss of the money you invest. Diversification does not ensure a profit or protect against a loss.

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