Guide to Investing in Stocks

1. Decide how you want to invest

First, you must decide HOW you want to invest in the stock markets. There are many different approaches that investors can choose to take. You can choose to invest in individual stocks, index funds or Robo-advisors. Each investment strategy has different advantages and disadvantages depending on what type of investor you are. Let’s take a look at all three:

Individual stocks: If you are more of an active investor then investing in individuals stocks is best for you. These stocks can increase and decrease significantly during the course of a day. Therefore, you must be prepared to evaluate your stocks on an ongoing basis. Analytics love this!


Index funds: Index funds, such as S&P 500 index funds and Nasdaq-100 index are a more passive approach to investing in stocks. The indexes do the work of tracking the performance of all of the stocks. They manage the funds so you can essentially sit back and relax. These funds usually have lower costs and are great long-term investments. But not great for short-term gains.


Robo-advisors: And last but not least, Robo-advisors is a brokerage that invests your money for you. They study the progress and performance of the stock daily and are essentially what people consider ”professional investors”. They will help you decide what stocks are best for you according to investing goals, risk etc. It’s great for investors who are not too familiar with the stock market. A helping hand can go a long way!

2. Choose an investing account

Choosing a reputable investing account is absolutely essential. You need to be sure your investments are safe and secure. You should do thorough research into the best investing accounts for you. First, you should research and write a list of the best investing accounts to invest in stocks. Reading real customer reviews is a great start to finding a reputable investing account! Look at the costs, incentives, services offered, a reasonable investment minimum, high-quality trading tools and great customer service.


Here are some of the best Online Brokers for Stock Trading in 2021:

⦁ E*TRADE
⦁ TD Ameritrade
⦁ Interactive Brokers IBKR Lite
⦁ Webull
⦁ Robinhood
⦁ TradeStation
⦁ Zacks Trade

3. Understand What You’re Investing in

The biggest mistake many investors (mainly first-time investors) make is not fully understanding what they are investing in. Sounds crazy, huh? but actually many investors do not fully understand the difference between stocks and funds before investing in them. Make sure you research and fully understand these differences. Needless to say, it’s crucial to your financial gains and success as an investor.

  • Stocks = an investment in an individual company
  • Funds = an investment into lots of different stocks. You will be buying a share of many different companies simultaneously. There are many different funds such as mutual funds, EFTs, Nasdaq-100 index funds, S&P 500 index funds and many more!

4. Budget

It’s so important to set a budget for your stock investment. Much like gambling, investing in stocks can become very addictive. Many investors go into it expecting financial gains and risking a large sum of money that they can’t really afford to lose. In any form of investment, there is ALWAYS a chance that you could lose everything. Don’t invest any money that you need for other things. It’s a very slippery slope to go down! If you make a budget, you will have more control over your money. It creates a spending plan for your money and will keep you from ever going into debt. You’re here to make financial gains, not losses!

5. Focus on long-term investing

Let’s face it, we all dream to wake up with one million dollars in our bank accounts! But short-term financial gains through stocks usually involve a lot of risks and have much more potential to end badly. Long-term investments are much more stable. Historically, long-term investments have always proved more profitable. The stock market is constantly changing and usually, stocks will increase in value. Therefore, over time it’s very likely that you can make significant gains over time.

6. Manage your stock portfolio

Managing your stock portfolio in an efficient way will unquestionably increase your financial gains. Reading lots of guides on the internet for stock portfolio management is great to give yourself the best start to investing. If you still don’t feel confident after reading these, here are some books that will help you:

⦁ Investing QuickStart Guide: The Simplified Beginner’s Guide to Successfully Navigating the Stock Market, Growing Your Wealth & Creating a Secure Financial Future by Ted D. Snow


⦁ The Lifestyle Investor: The 10 Commandments of Cash Flow Investing for Passive Income and Financial Freedom by Justin Donald


⦁ Financial Freedom with Real Estate Investing: The Blueprint To Quitting Your Job With Real Estate – Even Without Experience Or Cash by Michael Blank


⦁ The Book on Managing Rental Properties: A Proven System for Finding, Screening, and Managing Tenants with Fewer Headaches and Maximum Profits by Brandon Turner


⦁ Mastering the Trade, Third Edition: Proven Techniques for Profiting From Intraday and Swing Trading Setups by John Carter

You will gain many insightful investing principles in these books and can create a portfolio plan that works for you!

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