Total New to Stock Market, Please help!!

CaucasianAsian29 · #1 01-22-2006, 10:26 PM

Hello, I'm 22 yrs old and getting my BA this year. I've been reading a little on the Stock market, but really just starting out. Right now I could put alittle over $2000 into stocks, maybe Bonds. I feel that it is important to start at an early age, and I am ready to put the time into research. Any help would be greatly appriciated!

1. Is $2000 enough to get started? Should I save more before I begin?

2. What are some good reads in this subject?

3. I'm trying weigh the pros and cons of each online site, such as www.etrade.com, and others, Which is good for begginers?

4. Any other advice?

Thank you so much!

littlebu · #2 01-22-2006, 11:33 PM

Well I can't tell you about the sites because I just started out and haven't deposited any $$ yet. I have been going through the old posts and I ordered these books which were recommended to beginners. "The Neatest Little guide to stock market investing" by Jason Kelly, "Intellegent Investor" by Ben Graham, "How to make money in stocks" by William O'neil, "Technical Analysis of Stock Trends" by Edwards and MaGee, "The Millionaire Nextdoor" and "Rich Dad Poor Dad". The last two don't pertain to stocks though I don't think. I printed a huge list of others I still need to look at but these seemed like the general consensus on were to start

gmandan · #3 01-23-2006, 01:58 AM

1. I would say maybe wait a little bit more? Maybe other posters would disagree, but even with Scottrade's commissions, you're paying quite a bit for each buy-sell transaction relative to the amount that you might plan on investing in a particular stock. You might be better off researching and placing your money in some solid managed funds for now, particular look over this thread.

2. Most of the books mentioned already are pretty good and have been highly recommended by other posters.

3. Scottrade, cheap and gets most of the job done. Only drawback is the lack of ACH transfers for the moment and no one's really sure when that will come back. However, if you live near a local branch, you can just drop off checks and they're just as quick as ACH transfers.

CaucasianAsian29 · #4 01-23-2006, 02:35 AM

Thank you so much for your replys!!! Very good, I'm going to check out those site, and I probably will wait a while learn more, and save a bit more. Thanks

Rhett · #5 01-23-2006, 03:15 AM

My advice: put $2k in ING direct. Cash is king right now.

Evan · #6 01-23-2006, 03:43 AM

[ QUOTE ]
Cash is king right now.

[/ QUOTE ]
Why do you say that?

Dazarath · #7 01-23-2006, 08:17 AM

It's true that with 2k, commissions will eat your bankroll alive, but as the OP said, he's brand new, and probably shouldn't be investing in stocks. Why not put the money into an index fund or mutual fund? That way he can get started investing while he's reading books to learn. Just make sure you put it into mutual funds that have no fees and no load. ING Direct isn't a bad idea either. I'm not sure if the "cash is king" statement is correct, but it's better than letting it sit in Neteller.

littlebu · #8 01-23-2006, 10:18 AM

Lately I have been visiting a couple of stock trading forums looking for input and these two "Virtual Stock Markets" were recommended as a good way to learn a few things. Supposedly they are both free but I haven't signed up yet. You might want to check them out http://game.marketwatch.com/Home/default.asp

and

http://www.youngmoney.com/

CaucasianAsian29 · #9 01-23-2006, 06:14 PM

[ QUOTE ]
It's true that with 2k, commissions will eat your bankroll alive, but as the OP said, he's brand new, and probably shouldn't be investing in stocks. Why not put the money into an index fund or mutual fund? That way he can get started investing while he's reading books to learn. Just make sure you put it into mutual funds that have no fees and no load. ING Direct isn't a bad idea either. I'm not sure if the "cash is king" statement is correct, but it's better than letting it sit in Neteller.

[/ QUOTE ]

Your prob right, I shoulden't jump into anything. My plan is to wait, research and for now, instead of keeping the money in Neteller, I'm thinking bonds or mutual funds. I need to look into bonds and mutual funds first, but this seems to be best for me now. I wanted to get into stocks now, because I've heard many people say that if they had started younger, they would be rich by now.

Dazarath · #10 01-23-2006, 06:46 PM

[ QUOTE ]
...they would be broke by now.

[/ QUOTE ]
FYP

Ok, obviously, that's not always the case, but it may very well be if one thinks that just starting earlier will make him richer. It still takes knowledge of the market to earn money picking stocks. I don't mean to be offensive, but right now, your post sounds like the kid who wants to hop onto Party because "his friend earned $x playing poker online".

The thing with picking stocks, is that it's very -EV if you don't know what you're doing. You'd probably be better off playing slots; you'd lose less that way. With mutual funds, if you pick ones that have experienced managers, it should usually be +EV, even if it trails the market. Plus, there's the added advantage of lower volatility (as compared to an index fund) for those who are risk adverse. If you just want to match the market, an index fund is the way to go.