Stock Market Education For a Beginner - This Document Will Self-Destruct
I have been asked many times where to get started on a stock market education for a beginner.
It's not that all of my efforts in the stock market have been successes, but my experiences are varied enough that I have a good sense of many aspects of the market.
I have used a broker, spent time at a day trading firm, used online brokerages, etc.
And although I'm not an expert, I did stay at a Holiday Inn Express last night.
As I see it, there are two ways to be successful in the stock market.
1.
You can spend years educating yourself about the stock market in all of its complexities.
Learn what P/E is, debt/equity ratio, market capitalization, etc.
It probably wouldn't hurt to familiarize yourself with technical chart analysis.
Study up on Chinese Candlesticks, Fibonacci Numbers, breakout gaps and head and shoulder patterns.
Then you'll want to put all of this knowledge into action.
Of course, there are thousands of stocks to choose from.
You'll probably want to use some sort of filter available through online brokerages or other websites to narrow the list down some.
Then you can start studying the fundamentals of the stocks you've chosen, take a look at the charts, pick one that looks promising, decide on an entry point and make the buy.
Now you're the proud owner of a small piece of a company.
If you did your homework, the magic should start to happen.
Unless, of course, it doesn't, because often as not, that's what happens.
For reasons that are completely impossible to figure out, the price goes down, despite all evidence that suggests it should be doing exactly the opposite.
Maybe a fund manager needed to free up some cash and decided to sell 250,000 shares of your stock.
Eventually, with years of education and experience, you will probably gain the ability to choose good stocks - maybe.
That is the standard way to embark on a stock market education for a beginner.
Or.
.
.
2.
You can use a tried and proven method that will choose the stock for you.
While this method lacks the same sense of adventure that choosing your own stock offers, it does have the advantage of making you lots of money.
It's not that all of my efforts in the stock market have been successes, but my experiences are varied enough that I have a good sense of many aspects of the market.
I have used a broker, spent time at a day trading firm, used online brokerages, etc.
And although I'm not an expert, I did stay at a Holiday Inn Express last night.
As I see it, there are two ways to be successful in the stock market.
1.
You can spend years educating yourself about the stock market in all of its complexities.
Learn what P/E is, debt/equity ratio, market capitalization, etc.
It probably wouldn't hurt to familiarize yourself with technical chart analysis.
Study up on Chinese Candlesticks, Fibonacci Numbers, breakout gaps and head and shoulder patterns.
Then you'll want to put all of this knowledge into action.
Of course, there are thousands of stocks to choose from.
You'll probably want to use some sort of filter available through online brokerages or other websites to narrow the list down some.
Then you can start studying the fundamentals of the stocks you've chosen, take a look at the charts, pick one that looks promising, decide on an entry point and make the buy.
Now you're the proud owner of a small piece of a company.
If you did your homework, the magic should start to happen.
Unless, of course, it doesn't, because often as not, that's what happens.
For reasons that are completely impossible to figure out, the price goes down, despite all evidence that suggests it should be doing exactly the opposite.
Maybe a fund manager needed to free up some cash and decided to sell 250,000 shares of your stock.
Eventually, with years of education and experience, you will probably gain the ability to choose good stocks - maybe.
That is the standard way to embark on a stock market education for a beginner.
Or.
.
.
2.
You can use a tried and proven method that will choose the stock for you.
While this method lacks the same sense of adventure that choosing your own stock offers, it does have the advantage of making you lots of money.